Oversight Committee

Under the Financial Services and Markets Act 2000 (FSMA), the FCA must take ‘such steps as are necessary’ to ensure that the Financial Ombudsman Service (the Ombudsman) and the Financial Services Compensation Scheme (FSCS) can carry out their roles. For the FSCS, the FCA does this jointly with the Prudential Regulation Authority (PRA), which has its own governance processes. The Oversight Committee provides support and advice to the FCA Board on these matters.

Financial Ombudsman Service

The Ombudsman's role under FSMA is to ‘independently resolve certain disputes quickly and with minimum formality on the basis of what it believes is fair and reasonable in all the circumstances of the case’.

For the Ombudsman, the Oversight Committee:

  • reviews and challenges the Ombudsman’s annual budget, and recommends to the Board whether it should approve the annual budget
  • advises the Board on the Ombudsman’s qualification as an Alternative Dispute Resolution (ADR) Entity under the Alternative Dispute Resolution Regulations 2015 
  • advises the Board on appointing and removing the directors (including the chairman) of the Ombudsman (in the case of the chairman, this is done with the approval of the Treasury)
  • advises the Board on ensuring the directors are appointed on terms that secure their independence from the FCA in the operation of the Ombudsman Scheme
  • provides any other advice and support the Board requires to satisfy the FCA’s legal obligations, and exercise its powers, in relation to the Ombudsman

The Ombudsman is operationally independent of the FCA. The FCA cannot get involved in the decisions the Ombudsman makes on individual complaints.

Financial Services Compensation Scheme

The FSCS’s role under FSMA is to ‘protect eligible claimants that incur financial losses when firms authorised under FSMA are unable, or likely to be unable, to pay claims against them relating to certain regulated activities’.

For the FSCS, the Oversight Committee:

  • reviews and challenges the FSCS’s management expenses budget, and recommends to the Board the amount at which the management expenses levy limit of the FSCS should be fixed
  • advises the Board on appointing and removing the directors (including the chairman) of the FSCS (in the case of the chairman, this is done with the approval of the Treasury)
  • advises the Board on ensuring the directors are appointed on terms that secure their independence from the FCA in the operation of the FSCS
  • provides any other advice and support the Board requires to satisfy the FCA’s legal obligations, and exercise its powers, in relation to the FSCS

The FSCS is operationally independent of the FCA. The FCA cannot get involved in the decisions the FSCS makes on individual claims.

Meetings

The Oversight Committee meets at least 3 times a year with the executive and non-executive directors of the Ombudsman and the FSCS, including the chairs.

Membership

  • Charles Randell (Chair)
  • Baroness Sarah Hogg
  • Nick Stace
  • Richard Lloyd (OBE)
  • Christopher Woolard