| Link(s): | Op-ed: An explicit competitiveness mandate for EIOPA would miss the point – European Insurance and Occupational Pensions Authority EIOPA Note on Competitiveness |
Context
EIOPA has published a Note on Competitiveness, and an ‘op-ed’ article alongside it. An ‘op-ed’ (short for ‘opposite the editorial’) is a written piece that expresses the author’s personal opinion on a specific topic, typically published opposite a newspaper’s editorial page to offer an independent perspective. The Op-Ed provides an insight into the usefulness (or otherwise) of the UK financial services regulators’ secondary growth and competitiveness objective.
Key points to note and next actions
The Note on Competitiveness comments on:
- Competitiveness and stability.
- The broader determinants of EU competitiveness.
- Looking ahead: burden reduction and simplification.
- An assessment of the Prudential Regulatory Authority’s (PRA’s) second report on competitiveness and growth.
The Op-Ed sets out the view that an explicit competitiveness mandate for EIOPA would ‘miss the point’, and that Europe’s competitiveness challenge ‘cannot be solved by tinkering with the mandate of its financial supervisors’. The opinions include:
- Recent shifts in the global economy have forced Europe to face up to an uncomfortable reality: its competitiveness is flagging. The causes are numerous, from high energy costs and market fragmentation to the lack of scale-up financing. Complex rules, including in financial services, have also been blamed for holding back European businesses.
- Europe’s renewed focus on competitiveness and regulatory streamlining has also prompted bolder calls for the bloc’s financial supervisors to be given an explicit competitiveness mandate (like the FCA and the PRA have been given by the UK Government).
- For financial supervisors in the EU, such a mandate would be largely symbolic, and it would do little to address the structural factors that determine Europe’s competitiveness. The author’s view is that it would likely leave supervisors with ‘few meaningful levers to influence economic outcomes’, and could create confusion about priorities, weaken supervisory credibility and ultimately risk undermining trust in the financial system.
The article concludes that Europe’s competitiveness challenge is real and demands forceful policy responses. Supervisors will contribute most effectively to the continent’s prosperity by doing what they were created to do: safeguarding a stable, trusted and resilient financial system for the benefit of consumers.