Speaking at the Association of Professional Financial Advisers’ annual dinner on Wednesday, Tyrie warned the regulator needed to be under constant scrutiny to get “the balance right” between regulation that is too loose or too tight.
He said parliament would be observing regulatory developments but the industry needed to find a way to pass on information that the TSC could use as evidence, instead of “quietly whispering about shocking behaviour in the market in the regulatory sphere”.
Tyrie (pictured) told the audience: “We need regulation. An absence of regulation is not the free market, it’s the jungle, businesses will not thrive in a de-regulated market.
“But nor will they thrive in a market of excessive regulation. We would create stability for the customer, but it would be the stability of the graveyard. That’s why parliament must hold regulators to account to get that balance right.
“But it’s also up to you because you have to tell us what’s going on in the market. Find a way of getting that information to us because that’s what our job should and will be all about in the months and years ahead.”
Tyrie said the Financial Conduct Authority (FCA) needed to deliver a “higher quality level of regulation” than its predecessor, the Financial Services Authority (FSA), in order to “maximises economic activity legally conducted”.
He added there was now “possibly a considerable risk of consumer detriment” as a result of the Retail Distribution Review (RDR) and a fall in adviser numbers.
The TSC would hold the FCA to its obligation to issue “regular reports on the impact of the RDR on adviser levels and savings through independent financial advice”, he said.
However, he said it was too early to commission a full review of RDR as it would take “at least two years for the full impact to work through the profession” and the FCA’s own series of thematic reviews needed to be seen first.
