The House of Lords’ Financial Services Regulation Committee has sounded the alarm on “market uncertainty” around the UK financial watchdog’s upcoming motor finance redress scheme.

In a letter addressed to the Financial Conduct Authority’s chief executive Nikhil Rathi, the committee “considers it of importance” to receive further insight into the forthcoming scheme.

The City watchdog said in June any redress scheme would ensure the integrity of the motor finance market so it works well for future consumers.

But the letter, penned by committee chair Lord Forsyth of Drumlean, queried how the regulator can “substantiate its view”.

“The Committee expects the FCA to share the modelling it has undertaken, either publicly or privately, on the likely impact that redress at the estimated scale will have on the integrity of the motor finance market in the UK,” the letter read.

The FCA said it would consider cases dating back to 2007, a move which sparked fierce backlash with Stephen Haddrill, director general of the Finance & Leasing Association, branding the timeframe a “major concern” and “completely impractical”.

The committee said the limitation period for bringing a claim in the courts – which stands at 12 years – “may be more appropriate”. The letter questioned the “legal grounding” the regulator used to outline the timeframe.