The UK financial regulator’s refusal to accept a one-year delay to its planned January 2013 start date for sweeping reforms of the financial advisory industry prompted a sharp criticism from a panel of lawmakers yesterday.

The Treasury Select Committee, which last week had called on the Financial Services Authority to postpone implementation of the Retail Distribution Review by a year, said it was “unacceptable” for the FSA to turn down the TSC’s report a few hours after it had been published.

Last week’s report by the TSC highlighted fears that competent independent financial advisors could be driven out of business by the RDR unless more efforts are made to prepare the industry for its impact. The RDR is designed to raise qualification levels for advisors and drive out use of trail commissions so as to make advice more independent. The proposed measures come in the wake of mis-selling scandals and concerns that the industry must raise standards as financial services become more complex.

In an open letter to Hector Sants, chief executive of the FSA, Andrew Tyrie, who is chairman of the committee, said: “You will be aware that last Thursday the FSA circulated an embargoed response to our RDR report, rejecting in a peremptory manner our recommendation of a one-year delay to the RDR’s introduction. This was issued within hours of the embargoed copies of our report being published.”

“The committee has discussed this. We deprecate the authority’s action. It was precipitate, giving the impression that no adequate consideration had been given to the arguments for the delay we recommend. This is unacceptable. I will be placing this letter in the public domain,” Tyrie’s letter said. A copy of the letter was emailed to this publication.

The FSA, however, rejected the charge it had responded in haste.

In a letter to the TSC, Sants said: “I can assure the committee that the FSA is considering carefully the recommendations in the report and will follow its usual practice of submitting a full response. This will take some weeks, but we would intend to submit it by the end of September.”

“It was certainly not the intention of the FSA’s brief statement of 14 July to be seen as a peremptory rejection of any element of the committee’s report. Rather, it was intended simply to ensure that the momentum behind the preparations for the RDR is not lost,” the letter said.