Treasury financial secretary Ruth Kelly

The Treasury has announced a review of its financial services strategy.

Ministers are to consider whether the government's three-year-old Financial Services and Markets Act is working in line with initial expectations.

The Treasury gave the Financial Services Authority (FSA) sweeping powers to tackle mis-management when it passed the Act in 2000.

The review will look at how well the legislation is working.

Following a string of pensions mis-selling scandals, the government will assess whether further reforms are necessary.

The Office of Fair Trading will carry out an assessment of the impact of the Act on competition in financial services.

The FSA itself will also examine ways to reduce the costs of compliance by making its rules and guidance more accessible.

And the FSA's relationship with the financial ombudsman will come under scrutiny.

The FSA and Financial Ombudsman Service will consult jointly on when regulatory action should replace decisions on individual cases by the ombudsman.

It is expected that the whole review will take around one year to complete.

Announcing the review in a written parliamentary statement, financial secretary Ruth Kelly said the government wanted to fine tune a successful policy.

"The UK was the first country with a large financial services industry to set up a single regulator for the whole industry," she said.

"The regulatory framework established has been a resounding success that has proved to be a model that other countries have followed.

"The review will consider particular components of the existing framework to see if any changes should be made.

"Whilst there is no intention to change the structure established by the Financial Services and Markets Act, the government will consult publicly on any proposals for legislative change."

Ahead of the review the FSA has announced an overhaul of its senior management structure in a bid to get tougher on offenders more quickly.

Last month the Commons Treasury select committee accused senior officials at the FSA of allowing Lloyds TSB to "get away lightly" after it mis-sold thousands of high-income "precipice" bonds to customers.