- The Industry and Regulatory Committee has conducted an “investigation” into top regulators
- The committee is demanding evidence ahead of the inquiry as the watchdog faces criticism
Labour’s Lord Clive Hollick will lead the inquiry into British regulators
A House of Lords inquiry is set to examine the relationship between the government and UK regulators amid concerns about independence and accountability.
The cross-party industry and regulation committee, chaired by former media mogul Lord Hollick, is demanding evidence ahead of an investigation into some of the country’s most powerful regulators, including the Financial Conduct Authority, Ofwat and Ofgem.
Other regulators under the committee’s focus include the Pensions Regulator, the Bank of England’s Prudential Regulation Authority and the Office for Students.
Lord Hollick said the committee had already conducted an “investigation” into specific regulators and planned to “shine a light on the UK regulatory ecosystem and its effectiveness”.
According to the Department for Business and Trade, there are 90 regulators across the UK, excluding local authorities.
UK regulators cover a wide range of sectors and activities and have a range of different powers and responsibilities.
For example, in some cases they have been given a specific task by Parliament and while many are funded by taxpayers, others are not.
The Industry and Regulatory Committee’s inquiry will focus on regulators, which are considered public bodies with a statutory role determined by Parliament.
A number of UK regulators have faced significant criticism in recent years, blaming themselves for the failures they have observed in the industry.
Hollick was the former CEO of United Business Media until April 2005 and later attempted to buy ITV while employed by private equity firm KKR
The FCA, for example, has been criticized by critics for perceived failures in consumer protection, particularly in light of high-profile cases such as the collapse of the Woodford Equity Income Fund in 2019 and high fraud rates.
Meanwhile, Ofwat has been criticized for allowing water companies to pollute beyond allowable levels while racking up huge piles of debt, and Ofgem has been pilloried over its oversight of the energy market after several companies died in the wake of rising prices had collapsed.
Areas on which the Industry and Regulators Committee is seeking evidence include the balance between the responsibilities of regulators and those of government, as well as the skills and expertise of regulators and comparisons with international equivalents.
Lord Hollick said: “A common area of concern across all of these inquiries is the relationship between the regulator and government and the level of independence and accountability of regulators.”
“Many regulators are public bodies funded by taxpayers and have significant powers. Therefore, it is important that they are checked and held accountable.
“This short, overarching investigation will shed light on the UK regulatory ecosystem and its effectiveness.”