The Framework, which was introduced in January 2022, provides a structure for its members (Financial Conduct Authority (FCA), the Financial Ombudsman Service (FOS), the Financial Services Compensation Scheme (FSCS) and the Money and Pensions Service (MaPS)) to collaborate on issues that could have wider implications across the financial services industry. On 10 June 2024 the Framework published its second annual report outlining several workstreams that have been progressed under the Framework, as well as adjustments to its focus areas. This is the second annual report of the Framework, covering the period from 1 January 2023 to 31 March 2024.

So what?

The report highlights the Framework's role in fostering effective cooperation on issues with broad impact across the financial services industry to deliver better outcomes for consumers, firms, and the sector when those issues arise. It provides transparency to regulated firms and consumers on what these widespread issues are, how the regulators are collaborating and sharing information on them and what are they doing to address these issues.

In this report the Framework provides an update on the following workstreams that it has progressed since the last report as well as the adjustments that it has made to its focus areas:

Progressed workstreams include:

• Motor Finance Commission: The FCA and FOS collaborated on sharing complaints data and information, leading to the FCA's intervention on discretionary commission arrangements in January 2024.
• Consumer Duty Implementation: The FCA and FOS worked together on aligning interpretations and applications of the Consumer Duty, hosting joint events to reassure stakeholders of their consistent approach.
• Cost-of-Living Crisis: The Framework facilitated sharing of data and insights on emerging trends and risks, informing strategic responses and joint regulatory communications on debt collection practices and customer treatment in financial difficulty.

Workstreams being removed include:

Mortgage Standard Variable Rates (SVR): The Framework had identified the increasing numbers of complaints to firms alleging that SVRs on residential mortgages had not been set fairly. Subsequently, the FCA and FOS worked together extensively on this issue. The report confirms that this workstream was removed in April 2024 as its objectives have been met. Most mortgage SVR complaints covered by the Framework have been resolved by the FOS, with appropriate redress being paid. It states however, that the Framework may revisit the issue if new problems emerge.

Next steps for workstreams include:

• A refocus on the Authorised Push Payment fraud and scams workstream to adapt to significant regulatory changes affecting the payments market.
• Continued focus on addressing the cost-of-living crisis, with ongoing sharing of data and insights among member organizations to identify and mitigate consumer harms.
• Continued collaboration on the Consumer Duty, especially as the closed book deadline for firms approaches on 31 July 2024, ensuring firms meet their obligations and consumers are protected.
• Adapt and respond to emerging issues within the financial services sector, leveraging the cooperation duty for the regulators introduced under section 415C of the Financial Services and Markets Act 2023 to ensure effective collaboration and consistent outcomes across markets.