Outcome 1: Consumers and market participants have confidence that financial services firms which fail to meet the Threshold conditions and/or should otherwise not be regulated, are identified and cancelled quickly
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Metric code |
Metric description |
Source |
Baseline Value |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
|
DPF1-M01 |
Maintain awareness of, and increase perceived effectiveness of, FCA enforcement action on Threshold conditions
As a relatively high proportion of firms are familiar with FCA threshold conditions we are looking to maintain awareness, rather than increase, and have adjusted the metric description of this metric to show this.
|
FCA and Practitioner Panel survey
|
Extent to which firms are familiar with FCA Threshold conditions: Very/fairly familiar 94% Not very/not at all familiar 5% Don’t know 1% (2022/23) |
N/A |
Extent to which firms are familiar with FCA Threshold conditions: Very/fairly familiar 94% Not very/not at all familiar 5% Don’t know 1% (2023/24) Difference between year 2 and baseline value is not statistically significant. |
Little or no change |
|
Extent to which firms agree that firms who fail to meet Threshold conditions are identified promptly and their status withdrawn where appropriate Agree or Strongly Agree 53% Neither agree nor disagree 24% Disagree or strongly disagree 4% Don’t know 19% (2022/23)
|
N/A |
Values for year 2 not available due to an error in data collection. Values will be available for year 3 |
Not assessed |
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|
DPF1-M02 |
Increase in number of cancellations and withdrawals of permissions over the next 3 years This is to reflect an increase in our effort to intervene when firms do not meet the Threshold conditions or should otherwise not be regulated |
FCA data |
373 cancellations and withdrawals of permissions (2018 and 2019 annual average) 480 cancellations and withdrawals of permissions (2021)
|
627 cancellations and withdrawals of permissions (2022)
|
1261 cancellations and withdrawals of permissions (2023)
|
Improved |
Outcome 2: Consumers and market participants trust that the FCA intervenes to stop harm to consumers and market integrity quickly
|
Metric code |
Metric description |
Source |
Baseline Value |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
|
DPF2-M01 |
Increase in awareness of, and perceived effectiveness of, FCA interventions |
FCA and Practitioner Panel survey
|
Extent to which firms agree that the FCA is quick to intervene to stop potential harm within the industry: Agree or Strongly Agree 50% Neither agree nor disagree 28% Disagree or strongly disagree 13% Don’t know 9% (2022/23)
|
N/A |
Values for year 2 not available due to an error in data collection. Values will be available for year 3 |
Not assessed |
|
Proportion of firms aware of the FCA withdrawing permissions from any firms or individuals 55% (2021) |
Proportion of firms aware of the FCA withdrawing permissions from any firms or individuals 71% (2022/23)
|
Proportion of firms aware of the FCA withdrawing permissions from any firms or individuals 78% (2023/24) Difference between year 2 and baseline value is statistically significant. |
Improved |
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|
DPF2-M02 |
Reduction in time between identification of firm causing serious harm and decision on use of intervention tool |
FCA data |
25% of interventions took less than 17 business days; 75% took less than 96 business days; with the average being 67 business days from identification of serious harm to taking action using the following tools: Own Initiative Requirements/ Own Initiative Variation of Permissions/ Voluntary Requirements/Voluntary Variation of Permissions/Own Initiative Variation of Approved Person (2023) |
|
This is a new Baseline Value metric established since July 2023 |
Not Assessed |
|
DPF2-M03 |
Increase in use of intervention tools following identification of firm causing serious harm. |
FCA data |
Own Initiative Requirements/ Own Initiative Variation of Permissions– 25 (2021) |
Own Initiative Requirements/ Own Initiative Variation of Permissions – 19 (2022) |
Own Initiative Requirements/ Own Initiative Variation of Permissions – 34 (2023) At least the following additional FCA Interventions tools (see below)
|
Improved |
What the latest metric values tell us
For metric DPF1-M02, the number of cancellations and withdrawals of permissions doubled in 2023. This shows the results of our efforts to quickly cancel firms, using our new cancellation powers where applicable.
We expect that intervening faster and more strongly when firms fail to meet Threshold conditions will result in a short-term increase in the number of cancellations and withdrawals of permissions. We then expect this to decline as relevant firms match their conduct to our expectations.
The FCA and Practitioner Panel 2023/24 survey (DPF2-M01) showed 78% of firms were aware of us withdrawing permissions, up from 71% in the 2022/23 survey, and 94% of firms continue to be familiar with our Threshold conditions.
For metric DPF2-M03, the number of own-initiative interventions increased in 2023, compared to 2021 and 2022. We have also included our use of 268 further intervention tools (between July 2023 and April 2024) not previously reported to better illustrate the range of interventions we have taken during 2023 and the wider use of our regulatory tools, acknowledging that the number of interventions taken will be greater still. This involves getting firms or individuals to take specific actions, stopping or restricting their activities, withdrawing permissions or putting conditions on their approval. This increase reflects our commitment to take the appropriate action against firms to stop serious harm.
In developing metric (DPF2-M02) we have established that the pace at which we are able to intervene against serious harm can vary greatly depending on the matter. 25% of cases referred to our Enforcement Interventions team took less than 17 business days to intervene, 75% took less than 96 business days, with the average being 67 business days. This demonstrates that we can act at pace and we will continue to challenge ourselves on ways to improve.
Our work with problem firms should help build consumer confidence. While consumer and firm sentiment may be influenced by the macro-economic environment and factors outside our control, our Financial Lives survey shows the percentage of consumers who have confidence in the UK financial services industry when surveyed in 2023 had increased, compared to the baseline in 2020. In 2020, 41% of consumers slightly or strongly agreed they have confidence in the UK financial services industry, rising to 43% in 2023.