The FSA should ensure it does not cause the UK financial services industry to stagnate as it tightens regulation, the Chancellor says.
Speaking at the Turner Review conference in London, Alistair Darling said regulation should not stifle innovation, but agreed the FSA needs to increase its role.
He also supported greater international cooperation to regulate finance companies, and more 'intrusive' regulation.
However, the Chancellor warned against going too far, saying: "We need to walk a fine line between sufficient regulation that needs to safeguard public interest but not so much that we stem the flow of credit and stifle the very innovation that can benefit us all."
He also outlined the need for competition in the UK market, to provide choice to consumers.
Nevertheless, Lord Adair Turner, chairman of the FSA, believes increased regulation could shave as much as 1% off the UK's GDP, and says he expects the industry to be smaller and for its staff to be less highly paid in the future.
Contact: John Bakie, Tel: 020 7484 9805, e-mail: [email protected]IFAonline
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