Has the UK regulatory system failed?
As we see literally hundreds of billions of pounds of taxpayer's money poured into a new rescue package for the UK banking sector there are serious concerns that the UK regulatory system has failed. This is a system which was predominantly based upon "self-regulation" giving many companies in the sector carte blanche over their activities, expansion plans and business decisions. There was very little recourse to regulators and indeed the banking sector has over the last two years enjoyed a very close relationship with the UK government.
The Bank of England seems to have attracted more than its fair share of criticism with regards to the regulatory issue when in fact the FSA has been revamped and revamped again by the UK government over the last two years. System after system after system would appear to have failed both the UK financial sector and UK taxpayers who have been on the receiving end of substantial requests for extra finance.
While the government has pledged to tighten the regulatory framework within the UK this is very much a case of "closing the stable door after the horse has bolted". The Prime Minister has today joined in the chorus of criticism aimed at the UK banking sector but many believe that in due course this criticism will be pointed towards the current government.
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