Osborne welcomes Sassoon report into tripartite financial regulation

George Osborne has welcomed the publication of Sir James Sassoon’s interim report on the tripartite structure of financial regulation.

The Shadow Chancellor ordered a review of the UK’s regulatory arrangements last autumn – and Sir James’ report concludes that the current tripartite structure has failed in a number of respects and needs a major overhaul.

Some of the key recommendations in the report are:

• New responsibilities and powers for the Bank of England so it can call time on debt
• Fundamental reform of the Financial Services Authority to minimise the risk of individual institutions being able to again endanger the stability of the financial system
• A full analysis of the separation of ‘utility’ and ‘investment’ banks
• Increased capabilities for safeguarding financial stability in all the authorities

George warned that the current regulatory arrangements in the UK are not sufficient, and stressed the need for change:

"The current tripartite structure failed to protect Britain's economy from over indebtedness, a banking crisis, and ultimately recession. The regime needs a radical overhaul, and this report sets out the options that we need to consider.”

He promised to “carefully consider” Sir James’ report, and said, "It is increasingly clear that it is the Conservatives who are doing the long-term thinking that will help get us out of recession, and prevent us getting into such a mess again.”

Read Sir James Sassoon's report into the tripartite system