Coronavirus: Key Workers - Essential Financial Services provision
Yesterday, the Government published its Guidance for schools, colleges and local authorities on maintaining educational provision.
This included a list of Key Workers deemed to be providing essential public services at a time of unprecedented need, in order that the children of Key Workers can still attend childcare and school facilities, enabling Key Workers to continue working.
Staff included in the “essential financial services provision” category includes but is not limited to workers in banks, building societies and financial market infrastructure (FMI1) and payments providers.
The types of firms explicitly listed cover essential services with potentially critical impact if they were to cease - those without which the financial system could collapse, which would inevitably impact all other essential public services.
The purpose of the list is to ensure that schools and childcare providers only congregate those children who cannot go anywhere else – minimum numbers to avoid further spreading of COVID-19 and to ensure that depleted numbers of teaching staff can cope.
The list is non-exhaustive and leaves room for flexibility, perhaps to cover unforeseen developments. Therefore a judgement call is needed now, and on an on-going basis, to decide whether or not your business (or part of it) is providing essential financial services.
It could be argued that there is a second tier of essential services that would not necessarily have critical impact, but would still help to protect many consumers and businesses as the FCA expects2 , and which could have a positive knock- on effect on the national efforts to manage this rapidly changing situation.
There could be various financial services that form part of a supply chain involving other essential services, perhaps with insurance or financing issues (e.g. are your clients in the pharmaceuticals, food or utilities industries?). Lenders, insurers/insurance administrators and other firms being tasked with taking certain measures to alleviate financial pressures could all fall within this second tier. By now, firms will almost certainly have been considering their own business continuity plans (an essential element of being a regulated firm, as part of the appropriate resources threshold condition) and assessing which aspects of their own businesses are core services that need to be safeguarded and resourced as a priority for the benefit of their customers and the business.
1 - Those falling within FMI include recognised payment systems (e.g. Bacs and LINK), central securities depositories, and central counterparties (CCPs). Further information can be found on the Bank of England website https://www.bankofengland.co.uk/financial-stability/financial-mar- ket-infrastructure-supervision
2 - The FCA has explained that it is in “regular contact with firms to assess their current position, and expect firms to be taking reasonable steps to ensure they are prepared to meet the challenges coronavirus could pose to customers and staff, particularly through their business continuity plans.
"We expect firms to provide strong support and service to customers during this period. They should be clear and transparent and provide support as consumers and small businesses face challenges at this time. We also
expect firms to manage their financial resilience and actively manage their liquidity. Firms should report to us immediately if they believe they will be in difficulty.”
This note is for general information only and does not, and is not intended to, amount to legal advice and is not intended to be relied upon as such. If you have any questions relating to your particular circumstances, you should seek independent legal advice