FSA to survive despite previous coalition plans to scrap

| June 14, 2010 | 0 Comments

The BBC reported over the weekend that City Watchdog, the Financial Services Authority (FSA), will be retained - as a subsidiary of the Bank of England.

It was expected that the watchdog would be axed under initial proposals from the Conservative Party.

However, according to the BBC, Chancellor George Osborne will unveil plans later this week to keep part of the FSA, while also creating a new Financial Policy Committee, comprising of Bank executives with a direct responsibility for financial stability and senior representatives from the FSA.

The FSA was set up in 1997 by then Chancellor Gordon Brown and its objective was to regulate the financial services industry.

However, oversight of the financial system was shared between the FSA, the Bank of England and the Treasury - something which Mr Osborne has long been critical of, according to the BBC.

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