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MoD must stop living beyond its means
National Audit Office has said The Ministry of Defence must stop "living beyond its means", so what of the FSA, the NAO and the CPMA when it arrives?
The BBC has reported that the NAO, the independent body that monitors government spending, said the MoD had a tendency to revise up each annual budget as the year progressed.
Richard Bacon, a Tory MP is quoted as saying "there are very difficult and painful choices ahead and the MoD's fancy financial footwork has long ceased to impress"
On Tuesday last, Dr Liam Fox, the defence minister, said Britain's shopping list for military equipment was "entirely unaffordable".
Given the level of cuts that are being forced upon the MOD, the Ministry that oversees the safety of the nation's defences, will the need to live within its means be forced upon the FSA and it's associated regulatory bodies? Or, is the FSA of more importance to the nation than the resourcing of its armed forces?
Money Marketing reported last year that The National Audit Office will audit the FSA from the 2010/11 financial year.
Speaking in the House of Commons last year, Treasury Exchequer Secretary Sarah McCarthy-Fry said: "The NAO has a valuable role to play in delivering transparency and accountability so I am pleased to announce that the FSA has decided to appoint the comptroller and auditor general as its financial auditor from the next financial year, 2010/11.
At the moment, the FSA uses a revolving credit facility to subsidise its overspends, in the past this has been provided by the very banks that it regulates, until such time as it can levy increased fees to cover its often perceived profligate programme of spending.
The Regulators' Compliance Code is a central part of the previous Government's better regulation agenda. Its aim is to embed a risk-based, proportionate and targeted approach to regulatory inspection and enforcement among the regulators it applies to.
Their expectation is that as regulators integrate the Code's standards into their regulatory culture and processes, they will become more efficient and effective in their work. They will be able to use their resources in a way that gets the most value out of the effort that they make, whilst delivering significant benefits to low risk and compliant businesses through better-focused inspection activity, increased use of advice for businesses, and lower compliance costs.
The Compliance Code has been issued with parliamentary approval, following a wide and lengthy consultation process, and comes into force on 6 April 2008 by virtue of the Legislative and Regulatory Reform Code of Practice (Appointed Day) Order 2007.
With a budget that is some half a billion pounds a year, it is absolutely vital that in these testing times for the nation's purse, the FSA and going forward the CPMA, adhere to a proportionate and targeted approach to regulatory inspection. They should consider the impact that regulatory interventions may have on economic progress, including the consideration of the costs, effectiveness and perceptions of fairness of regulation.
A statutory body such as the FSA, and any regulator following in its footsteps must be more transparent and clearly demonstrate an understanding of restraint and value for money.
And absolutely no more "Trouble in Shangrila"!!!
Article last updated: Jul 26, 2010
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