Competition and Markets Authority chair quits over slow pace of reform

Andrew Tyrie, chairman of the Competition and Markets Authority (CMA), is to step down from the role in September, indicating some frustration with its limitations and the pace of reform

Tyrie, a former chair of the Treasury select committee, has headed up the CMA for the last two years.

Tyrie said: ‘On taking the role, I was asked by the government to map out a route to a new type of competition authority, one better equipped to understand and respond to what most concerns ordinary consumers: penalties for loyal customers, price discrimination against vulnerable consumers, the difficulties faced by millions in getting good deals online, among them.

‘I was also asked to suggest ways in which the CMA could become more agile, less legally encumbered, and also with closer international ties, reflecting both the increasingly global and often digital nature of consumer detriment, and the CMA’s enhanced post-Brexit role.’

During his time at the competition watchdog, the CMA has made a number of high profile interventions, including vetoing a merger of Asda and Sainsburys.

In April last year, the CMA published its final report on the UK audit market, which it said had identified ‘serious competition problems’.

At the time the CMA called for rapid legislation to address both the vulnerability of the industry to the loss of one of the Big Four firms, and the current inadequate choice and competition across the market, which is dominated by four players – PwC, Deloitte, EY and KPMG.

It made three recommendations to the government – splitting the Big Four firms on an operational basis, mandatory joint audit except in the case of the largest audits and greater oversight of audit committees.

Since then, progress on audit reform has slowed, with the legislation required to bring about changes delayed, partly as a result of the government’s focus on Brexit, the general election and now coronavirus.

The Kingman review of the audit market, which CMA considered as part of its inquiry, recommended the Financial Reporting Council be disbanded and replaced by a new sector regulator, the Auditing, Reporting and Governance Authority (ARGA). while this has taken place, ARGA’s powers are limited because of a lack of legislation.

Commenting on his plan for departure, Tyrie noted: ‘The CMA submitted proposals for wide-ranging legislative changes to the government last year.

‘It has taken forward important work to protect consumers, and it has imposed tougher penalties on those who break competition law.

‘And in our response to the coronavirus outbreak, we’ve reoriented the organisation to listen and act on consumer concerns more quickly and effectively. In responding, the CMA has shown a remarkable and unprecedented capacity to develop an emergency role.’

However, he went on to state: ‘The government asked me to take this work forward at great pace. I have done so.

‘I now want to make the case more forcefully for legislative and other reform – in Parliament and beyond – than is possible within the inherent limits of my position as CMA chairman.’

The Department for Business, Energy and Industrial Strategy has said it will now commence the process for recruiting a new chair of the CMA.

Average: 5 (2 votes)