On the Future of Financial Supervision

Speech by Sharon Bowles MEP delivered to European Parliament on Wed 8th Oct 2008

this report is ambitious but also realistic. It analyses the causes of the financial turmoil and proposes future changes. Many of these changes, as others have said, would have been suggested without the present situation, because there was already a view that the Lamfalussy process had not progressed as far as it could or should have done.

So this is about the next generation of supervision, rather than a fix for the current crisis - though we think it will help prevent any similar occurrence, and now there should be more willingness at Member State level to have formal integrated decision-making structures.

But I reiterate that it is important for regulation to be smart. The solution to our current problems, and the calmer future when it arrives, will not take the form of regulatory spam with thousands of compliance tick boxes, which, as we now know, causes it to be pushed off to specialist departments to do the ticking, without proper 'hands-on' at board level.

We should have clear, simple rules. Some, yes, fuller in scope, but rules that do not swamp the big picture, so that those at the top are properly accountable and know what is going on.

Finally, as part of crisis resolution, we need improvements on winding up, but that is not just in crisis situations: we also need to look at cross-border winding up in normal times. Here again we may need to tread on territory that makes Member States uncomfortable, but it has to be faced.