Julian Knight: We're just crying out for a consumer champion
Sunday 06 February 2011
Martin who? You could be tempted to ask when the chief executive of the new CPMA – the replacement for the failed FSA – was announced the other day.
The Government has appointed, in Martin Wheatley, someone completely unfamiliar to British consumers. But Mr Wheatley has an excellent track record as former deputy chief executive of the London Stock Exchange and, most recently, six years as Hong Kong's financial watchdog. As anyone who has spent any time in Hong Kong knows, the former colony lives and breathes financial services, with product sophistication the match of the UK and consumer knowledge much better. By all accounts, his tenure was successful and he will be abundantly familiar with some of the severe capital issues facing the banking system.
However, there is a big "but" for me in Mr Wheatley's appointment. The Consumer Protection and Markets Authority isn't a direct match for the FSA – it's supposed to be a new body dedicated to protecting the consumer. The old FSA was completely dominated by people who had worked in financial services and, until very late in its life, consumers seemed an afterthought. It was a far-too-chummy operation, with regulation all about box-ticking exercises rather than spotting the varied and ever-changing consumer abuses of the financial-services industry.
The CPMA was supposed to be a clear break from that past. The Bank of England would look after the numbers while the new body would be focused solely on consumer protection. The unworkable dichotomy at the heart of the FSA – that it was supposed to protect the interests of consumers and the financial services industry – was to be avoided. But Mr Wheatley's appointment strikes me as very much "old FSA". This appointment was a great opportunity to set a marker down that we were in a different era in which being completely au fait with the City and the characters that populate it was less important than understanding that there is a moral dimension to the provision of financial services. And, that, in future, the industry and every product it offers would be judged from the simple premise of whether it adds to the consumer good, or not.
The old FSA had started to make the right steps in this direction, too late to save its reputation, of course. My fear is that under a Conservative-led government (which is hardly ideologically suited to a regulator that will have to tell powerful institutions at times to, frankly, get stuffed), and with a City-focused head, the CPMA won't fulfil the role we desperately need it to.
We could well be in danger of swapping a poorly focused and rather gutless body with one that is similar but with less power, a much smaller budget and a lower profile. It is too early to judge which way the CPMA will go, and Mr Wheatley is certainly a capable individual, but he needs to appoint well within the new organisation and value an understanding of the consumer over – but not to the complete exclusion of – an understanding of the City. A consumer champion is what we need.
Moral investment compass
Regular readers will know I am an unashamed fan of emerging markets. They have the growth, productivity, huge skill development potential and, crucially, demographics on their side. But for investors, the past couple of weeks in Egypt highlight the all too often ignored fly in the emerging-market ointment – political instability.
For the past couple of years, Egypt has been a slow burner of an investment story – not as stand-out as the Bric countries, or for that matter the other rising Islamic economic star, Turkey, but compared with the rest of the African continent, a potential investment winner. Five per cent economic growth a year is not too shabby any benchmark.
On my visit to Egypt last year, I saw how the infrastructure had been improved and – a sure sign of a burgeoning economy – the cars on the roads were expensive and new, and this is in an economy which doesn't rely one iota on consumer debt. Yet corruption and cronyism are everywhere, as are the secret police. And it's a country with such a specialism in torture that the Bush administration allegedly contracted out to it much of its dirty work.
But a major draw for foreign investors big and small was that it was said to be stable. Yet the very thing that made it so stable – Mubarak's oppressive regime – is what now makes it unstable. Now investors in Egypt face the fact that the banks are closed and, if they want to, it's not going to be easy to get their money out of the country. It goes to show that it's best not to be so blinded by the emerging-market story that you take your eye off your moral compass.
Lies, damned lies and the ONS
Officials at the Office for National Statistics have been rather spiky after suggestions in this newspaper that its horrendous fourth-quarter 2010 figures will almost certainly have to be revised up.
The ONS has form in this area, with its initial pronouncements – which are based on around half of returns and leave out some of the national economy's big hitters – having to be revised upwards, quite considerably, in the past. I don't quite understand why it is that the ONS can't wait to release its figures until it has the overwhelming majority of returns.
Who knows how many real business decisions were made in response to these flawed numbers? To paraphrase the famous wartime saying, careless forecasting costs jobs.
Financial advisers must change “old school” attitudes to reduce the investment gender divide
Scottish Power hit with sales ban by regulator
10 tips for taking out a personal loan
Which? calls for caps on high pension product fees
There are 'dark corners' of the investment and pensions industry, says Pension Minister
- 1 Autism 'caused by genetics', study suggests
- 2 What happens to your body when you give up sugar?
- 3 Why you should never make assumptions about people with autism
- 4 Tourist films plane's descent just metres above packed Caribbean beach
- 5 Have sex with your iPad thanks to the new sex toy no-one asked for
Durham Free School: 'Creationism taught at' free school facing closure
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
End of the licence fee: BBC to back radical overhaul of how it is funded
Ex-head of MI6: 'We shouldn't kid ourselves that Russia is on a path to democracy'
Most people think legal tax avoidance is just as wrong as illegal tax evasion, poll suggests
Nigel Farage promises Ukip will not 'stigmatise' would-be migrants – and says he wants 'everyone to speak the same language'
iJobs Money & Business
£13000 per annum: Recruitment Genius: This is an exciting opportunity to join ...
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
£8 per hour: Recruitment Genius: This Pension Specialist was established early...
£30 - 35k + Bonus & Benefits: Guru Careers: We are seeking an Executive Assist...
Day In a Page
This school conversion, near Stockwell Tube, oozes New York loft style. The one-bedroom flat features double height ceilings and exposed brick work
This six-bedroom Georgian home is on three floors with open fireplaces, a two-oven Aga, an annexe, and cottage gardens with outbuildings and a car barn
High Crest House covers an impressive 9384sq ft, with almost three acres of grounds including a tennis court and summer house enclosed by electric gates
A six-bedroom farmhouse with separate accommodation in converted stables. Situated in the village of Church Aston, within walking distance to the market town
A two-bedroom flat with under-heated walnut floors and bespoke built-in storage. The Tube and Clapham Common are a short stroll away
A refurbished seven-bedroom townhouse with staff quarters, cinema room, superb gym, steam room and plunge pool
A minimnalist four-bedroom home designed to the highest spec, featuring glass walls and a kitchen space lit by a glass roof
Hibernate during winter and make your living during the summer at this busy guesthouse with panoramic sea views, in the village of Lynton
A four-bedroom penthouse next to the Tate with direct views of St Paul's from two floors of luxurious living space
A four-bedroom detached home surrounded by spacious gardens and woodland, close to New Pudsey
An 18th-century, three-bedroom home near Langstone Harbour built from ships beams with vaulted ceilings and wood burning stoves
A five-bedroom semi-detached home with a mix of period and modern features in a popular and convenient location
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
A three-bedroom villa with self-contained flat, minutes from Lake Windermere
A deceptively spacious, beautifully presented Georgian home with 3000sq ft of living space and five reception rooms
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads