Wednesday

17th Apr 2024

Barnier to end domination of bank lobby in EU advisory groups

  • Bankers - who have become wildly unpopular since the financial crash - dominate the groups that advise on how banks should be regulated (Photo: suburbanslice)

EU internal market commissioner Michel Barnier has said he is to move against the domination of the financial sector in "expert groups" that advise the European Commission on financial regulation.

Mr Barnier, who is also responsible for reform of financial regulation across the bloc, on Monday (1 November) announced that he has asked the civil servants under him to perform a review of the expert-group system and revise it to provide for greater representation from consumer groups, trade unions, small businesses and NGOs.

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"I remain convinced that more needs to be done to enhance the active participation of civil society organisations in Internal Market policymaking in order to fully achieve a fair balance on non-industry stakeholders' representation in our consultation process," he wrote in a letter to lobby watchdog group Alter-EU.

The commission's expert groups, which advise the EU executive on controversial issues and are often the source of policy concepts, have been criticised by pro-transparency NGOs as undemocratic as despite the power they wield, they remain unelected and unbalanced due to the preponderance of industry representatives on them.

A total of 11 out of the 25 expert groups advising on financial regulation issues all have a majority of representatives from the banking lobby, allowing industry representatives direct access to officials - in some cases overwhelmingly so.

The Payment Systems Market Expert Group for example, maintains 43 representatives from business, and just two from government, one from academia and one trade unionist. In another expert group on the monitoring of codes of conduct in the clearing and settlement sector, the inbalance is so lopsided that it has 62 industry representatives to four from government.

The orders given to his services to reconsider how the expert group representatives are picked follows on from a commitment that the commissioner made in his confirmation hearing before the European Parliament in January, stressing the need for balanced representation in the groups.

Alter-EU for their part have cheered the commissioner's move, saying that such changes if successful can "mark a turning point towards a more sustainable financial sector that is beneficial for society at large."

However, in order to ensure that new financial regulation development reflects the demands of the EU Treaty that all citizens "shall receive equal treatment from [EU] institutions," the group said in a letter responding to the commissioner's move, it is not enough just to add a handful more representatives to the expert groups.

Instead, in order to avoid what the group calls "corporate capture" of decision-making, "it is essential that commercial interests - both financial services providers and business users of such services - do not have the majority in any expert group."

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