Senior MPs condemn banks quango chair over dodging questions
Senior MPs have blasted the chair of the Financial Ombudsman Service (FOS), the banks quango which settles complaints made by consumers against banks, for obstructing scrutiny after Abby Thomas was dismissed as chief executive.
Zahida Manzoor, Baroness Manzoor, the Tory peer who leads governance of the public body settling complaints between consumers and banks, has been heavily criticised by MPs on the Treasury Committee for dodging questions on the departure of Thomas from FOS.
Manzoor told MPs she was not required to answer the committee’s questions due to her membership of the House of Lords.
A new report by the Treasury Select Committee has concluded that “fundamental disagreements” between Thomas and the board of directors overseeing the ombudsman led “confidence to collapse”, resulting in a change of leadership.
In an initial hearing in February, Manzoor said Thomas’ departure was a “mutual agreement”.
But in the following months, Manzoor refused to answer questions as she claimed she was not required to appear before the committee “as a member of the House of Lords” and concerns about protecting Thomas’ well-being.
MPs on the Treasury Committee said Manzoor should have answered questions and asked for confidentiality.
Banks quango under pressure
The debacle involving a key public body adds to concerns that quangos often escape scrutiny and are not held accountable.
At the end of last year, former minister Simon Hoare, who oversees the public administration committee, said arm’s-length bodies had become a “law unto themselves”.
The government has also faced criticism for failing to count the number of quangos that operate on taxpayer’s cash.
Moves to strip NHS agencies and strip red tape at City regulators have taken shape, making paperwork easier for investment firms and banks.
But the government has also created a number of new public bodies, including the Office for Investment, the National Infrastructure and Service Transformation Authority (NISTA) and the National Wealth Fund, whose creation has been criticised as “completely misleading”.
Meg Hillier, chair of the Treasury Select Committee, said the management of senior leadership at the banks quango had been “deeply disappointing”, adding she hoped the controversy sent a “clear message” to any organisation planning to avoid accountability.
“The attempt to frustrate a House of Commons Committee from scrutinising the actions of a publicly accountable organisation ultimately proved unsuccessful,” Hillier said.
Manzoor said: “I highly value the Treasury Select Committee and the important role it plays in holding the financial sector to account.
“I am committed to providing open and transparent evidence to the committee, but there are rare instances when that can be difficult – particularly when it relates to employment matters.
“I have always treated the committee with the utmost seriousness and respect, and I know the Financial Ombudsman Service will continue to work closely with them in the future.”