The UK’s financial regulators say working together has improved outcomes, particularly in relation to the British Steel Pension Scheme scandal, the introduction of Consumer Duty, and failings by SIPPs operators.

The Wider Implications Framework Annual Report 2023/24, published today, sets out how the FCA, the Ombudsman Service, FSCS, MaPS and the Pensions Regulator have worked together.

The report covers 1 January 2023 to 31 March 2024, during which section 415C of the Financial Services and Markets Act 2023 came into force. That introduced a new duty for three of the members – the FCA, the Ombudsman Service and the FSCS – to cooperate on issues that have significant implications for each other or the wider financial services market.

The report explained how co-operation has improved the regulators' work in several areas, including BSPS, Consumer Duty and SIPPs redress.

BSPS redress scheme

In February 2023, the FCA set up a consumer redress scheme for former members of the BSPS who received unsuitable pension transfer advice. The scheme aimed to put those who lost out because of unsuitable advice back in the position they would have been if they hadn’t transferred out of the BSPS.

The FCA hosted around 20 events in steelworker communities across England and Wales during the period which were attended by the Ombudsman Service, the FSCS and MaPS. More than 1,200 consumers signed up to attend the events.

The regulators said sharing insights on firms’ behaviour and consumers’ areas of concern early on allowed them to focus their efforts in a timely way. Sharing actuarial insights and expertise also helped to drive more cost-efficient use of resources, they added.

The Ombudsman Service and the FSCS agreed a new process to ensure that customers of firms unable to pay awards by the Ombudsman Service could be promptly transferred to the FSCS, saving time and resources. The FCA and the Ombudsman Service also set up a bespoke ‘facilitated referral’ process as part of the consumer redress scheme which referred cases to the Ombudsman Service where firms concluded the advice they provided was suitable but the consumer was not satisfied with the firm’s conclusion.

Consumer Duty

In the run up to implementation of the Consumer Duty on 31 July 2023 the report said that the FCA and the Ombudsman Service jointly attended industry and consumer events to give stakeholders reassurance that the two organisations were aligned on interpreting and applying the Consumer Duty.

They continue to work together as the closed book deadline for firms approaches on 31 July. For example, in September 2023, the FCA attended two post-implementation roundtables organised by the Ombudsman Service and UK Finance. These allowed the Ombudsman Service to set out its expectations to firms, while the FCA provided further clarity on its work.

In November 2023, the FCA and the Ombudsman Service attended the FCA Practitioner Panel and the Financial Services Consumer Panel together.

SIPPs

The report said the FCA, the Ombudsman Service and the FSCS have worked together to ensure consumers owed redress because of failings by SIPPs operators are going to the right place to get it and that it is paid promptly. It said working together has ensured all the members are sighted on the industry landscape, the complexity of these cases and how this might affect individual consumers.

Monthly data-sharing between members on outstanding complaints and claim volumes meant they were been able to prioritise casework to improve the chance of consumers receiving timely redress and enable relevant supervisory intervention.

The Wider Implications Framework Annual Report 2023/24 is available here.