View from City Road: Sound, fury and not much else

After all the heat generated by the creation of the Personal Investment Authority, the parliamentary report on financial services regulation seems surprisingly modest in its demands. But the real surprise is that the Treasury select committee managed to agree long enough to produce any report at all.

As was abundantly clear at yesterday's launch, the committee was hopelessly split. The eight MPs present might have been talking about eight different reports. Brian Sedgemore, the Labour warhorse who refused to sign the report, railed that the committee's decision-making was disgraceful, sleazy and undemocratic.

Recriminations flew back and forth. Mr Sedgemore walked out, calling Quentin Davies, the Tory MP, a public school wimp. Mr Davies accused his opponent of displaying 'an unedifying mixture of frivolity, malice and self-advertisement'. Somewhere in the midst of all this was a much tougher set of reforms proposed by Barry Legg, a Conservative.

He wanted the PIA to become a designated agency directly reponsible to the Treasury, with a majority of its board given over to non-practitioners such as consumer and Government representatives.

These sensible suggestions - which would have gone a long way to meet the objections of the PIA's opponents - received the majority backing of the committee. And yet, for reasons too incomprehensible to relate, the final version of the report reverted to the more modest original. As a result the PIA and the Securities and Investments Board had little difficulty in welcoming the main thrust of the report - its endorsement of a single retail regulator. Rather a case of much sound and fury signifying nothing.