Communications to firms - 30 September 2021
On 23 February 2021 we, the Bank of England (BoE) and the Financial Conduct Authority (FCA), published a letter committing to transform data collection from the UK financial sector (Transforming Data Collection). The letter set out a long term reform agenda to tackle the issues we and industry face with the cost, data quality and flexibility of the data collection process. As evidenced by a number of studies on data collection1, we think these issues are significant and require strategic investment to address.
At the beginning of July we launched a Joint Transformation Programme with industry to work together on the reform agenda. The Joint Transformation Programme is a space for industry and authorities to come together to design, test and evaluate solutions where collaboration is needed.
The Joint Transformation Programme will sit alongside other internal and external initiatives – all of which are needed to deliver the important work of Transforming Data Collection. For firms, these internal initiatives should include urgent work to fix issues identified in the recent PRA supervisory letter on regulatory reporting.
Expected future budget/resource requirements from industry
We currently have resource commitment from our Joint Transformation Programme participants for the ‘discovery and design’ stage of the first use cases – ending March 2022. We expect we will require industry resource to progress the work beyond March 2022. We expect resource will be required for a number of activities.
From July 2022 to July 2023, we expect to move to the ‘implementation’ stage of our phase one use cases. We expect to develop and publish detailed project plans for the implementation stage in Q2 2022. During the implementation stage we expect to develop and deliver some of the solutions we designed in the current ‘discovery and design’ stage. To help develop these detailed project plans, and to wrap-up the current 'discovery and design' stage, we hope some of the current participants in the programme will stay on from March 2022 to July 2022. In Q4 2021 and Q1 2022, we should have greater clarity on which solutions we might take forward for further investment and implementation.
Some solutions will be applicable to parts of the data collection process we manage. We expect to draw upon the designs and lessons learnt from the Joint Transformation Programme as we invest in our data collection solutions and platforms, and as we plan the future activities and roadmap for Transforming Data Collection. Some of those solutions and platforms have a strong external facing elements (such as the FCA/Bank RegData solution, and the reporting sections of the FCA/Bank’s public website). We expect to ask for help from firms in testing our external facing solutions and gathering their feedback as we develop them. We will be looking to form a group of industry users to do this. We expect that group will consist of individuals that actively use those platforms, and will need to contribute 2 days a month of their time for a 12 month period from July 2022 to July 2023.
Other solutions are likely to require the development and adoption of industry data standards. These standards will require tooling, training and people to manage and support those standards. We will need applications that show how standards can be used and add value to their users. We will be asking industry to contribute to developing new or existing standards and solutions based on those standards. We expect we will require a total of around £2,000,000 in voluntary contributions from industry for solution development.
From July 2022 to March 2023, we expect the joint transformation programme to carry out an ‘discovery and design’ stage for a new set of use cases. We expect these use cases to be more complex and higher value than the use cases in scope of the current phase. To enable us to continue with our ‘discovery and design’ work for new use cases, we will be asking firms to provide twice the levels and types of resource to the delivery teams as they do currently – around 20 FTE for the core delivery team. These FTE will focus on discovery and design/ prototyping activities, and will allow us to scale the approach and deliver more value faster.
In 2022, and during the course of the programme, firms and reporting solution providers may wish to consider what internal initiatives they want to run to maximise the benefits of the Joint Transformation Programme. For instance, these initiatives may relate to further developing and rolling out solutions designed by the programme; or may relate to planning and budgeting activities for future phases of the programme and wider work on Transforming Data Collection. We also know that some firms are now investing in significant initiatives to improve their Data Management.
Table of requirements/asks:
||Resource / budget requirement
|Testing BoE / FCA external facing solutions
||July 2022 – July 2023
||2 FTE per month
|Development of solutions
||In the region of £2,000,000
|Joint Transformation Programme innovation new use cases
||July 2022 - March 2023
||Approx 20 FTE.
|Consider internal initiatives to maximise benefits of the Joint Transformation Programme
We do not expect our work on Transforming Data Collection to trigger any mandatory change which will require firm implementation in 2022.
We recognise firms need to have greater clarity on the future phases and resource needs of the joint transformation programme and Transforming Data Collection work. The next steps for the BoE and FCA are to develop a roadmap for how we take the Transforming Data Collection initiative forward. We expect to have the first version of the roadmap defined and shared with industry by the middle of 2022.
Finally, for authorised deposit takers, we expect firms to resource urgent work to fix issues identified in the recent PRA supervisory letter on regulatory reporting.
Although the Joint Transformation Programme only launched in July, the programme team have already achieved a great deal. They have:
- Started to work effectively as a group despite working remotely and technology challenges. The Joint Transformation Programme brings together over 100 participants from more than 50 firms across two committees, a core delivery team, design advisory group and product owner group.
- Started the Discovery Phases for the DQ, CRE and RegData use cases. They have conducted DQ user interviews with 7 firms, the Bank of England and the ONS, as well as researching a wide range of initiatives related to these data collections.
- Started to identify a series of issues, and started to uncover possible approaches that may tackle those issues for the DQ use case.
Our wider work on Transforming Data Collection has also recently had a number of successes:
- The initial members of the Reporting and Data Standards transformation board have been agreed. The first meeting of the board is scheduled for 2 November 2021.
- The Bank of England has had a bid for £580,000 of HMT grant money accepted. That money will be used to help deliver a successful first stage of the joint transformation programme.
- The Bank of England recently asked statistical reporters to use the Legal Entity Identifier for statistical reporting. This is in line with the Bank of England’s commitment to promote the use of common data standards made in the Transformation Plan.
- The FCA completed the migration of 52,000 firms to RegData, which provides us with significantly advanced technology to shape the future of data collections.
Future joint work programme communications and updates
To ensure we continue to work with industry in an open, collaborative and transparent manner, we will be providing regular programme updates to not only share our outputs, but to provide opportunities to be involved with our work and to give feedback.
On Wednesday 13 October we will be running a Town Hall to discuss the Joint Transformation Programme and clarify any key messages industry have from this communication.
If you have any questions or points you would like to raise, you can email them to us by Thursday 7th October and we will endeavour to cover them on the day. Alternatively, there will be a short time set aside during the Town Hall for questions. The FCA will also soon provide some communications on how we are going to engage with FCA solo-regulated firms for this transformation journey.
1. See for instance, the Bank of England Data Collection Review, FCA / Bank of England work on Digital Regulatory Reporting, the independent review of the prudential supervision of The Co-operative Bank PLC.