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If the FSA was a football stadium…

UEFA figures show that the Portuguese football authorities either built, rebuilt or refurbished the 10 Euro 2004 stadia for a cost of £275m. Compare that with the new Wembley stadium cost of more than £700m and either the Portuguese got a bargain or our rebuild is a tad on the pricey side.

So what have regulation and football stadia got in common? Answer: neither comes cheap. I haven&#39t seen a massive number of column inches on how much the final bill for regulation will be but someone will have to pay.

A 2002 costing suggested figures of £36m in one-off set-up costs, plus recurring costs of £32m. This means that at the end of 2010 the cost will be somewhere in the region of £200m. I stress that these are 2002 figures. Personally, I suspect that the estimates are the thin end of the wedge.

There is an alternative argument that says in a marketplace that lends well in excess of £200bn annually, the estimated cost is a tiny fraction of total lending but my experience of these things suggests that rarely do costs decrease over time.

Which brings us to the $64,000 question – who pays? (Perhaps that should be a $64m question – ed.) The question is rhetorical. We all know it is the mortgage customer who will end up paying. The real point is how much benefit the customers will receive. Will they receive benefits commensurate with the expected bill? Can all interested parties be sure that consumers will receive the transparency and subsequent understanding that regulation promises?

It would be naïve to think that all regulatory objectives will be immediately fulfilled. Some are achievable in the shorter and some the longer term. But we must not lose sight of the fact that regulation must deliver on its objectives.

With this in mind, all the authorities must conduct regular research into consumer understanding and attitudes. Armed with this information none of the parties – trade bodies, intermediary forums or lenders – should shy away from making their point and influencing the direction and changes to regulation.

I have always supported the principle of statutory regulation as long as the consumer derives the benefits.

So, the costs involved are pretty large by anyone&#39s standards so what will the final bill be? I don&#39t think anyone can answer that with any degree of accuracy at this moment. The only thing I&#39m absolutely sure of right now is that the Portuguese got a great deal on those 10 stadia.

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