The UK financial services industry faces a whole new crisis this year with the very real prospect of political gridlock at the upcoming General Election spawning legislative uncertainty at a time of significant reform in the sector.

Ironically in a week which saw Britain brought to a virtual standstill as blankets of snow and freezing arctic weather swept down from Northern Europe to somehow surprise the authorities, it looks like financial services could be facing a period of inertia and uncertainty.

The chances of a hung parliament – the first since 1973 – are stronger than they were in the final months of 2009.

The Opposition Conservative Party has lost the impetus so prevalent over the past 18 months, with consumers and voters having now adjusted to the realities of the financial crisis.

Mind you, there is the small matter of reigning in the biggest national debt in the country’s history.

Anyhow, political infighting within the Labour Government ranks last week – initially intriguing as two dagger-wielding peripheries of the party attempted to force a leadership run-off – was extinguished no sooner than it began with PM Gordon Brown cementing his position by behaving like nothing had happened.

So what does all this mean for financial services?

The industry is presently both preparing and bracing itself for the full impact of the Government’s Retail Distribution Review, with a range of scenarios being played out in boardrooms across the country.

A hung parliament is likely to create a loggerheads consensus – leaving institutions in a state of inaction and decision paralysis.

If there is anything that the past two years has taught us, it’s that uncertainty can be the enemy of financial services.

An election victory one way or the other may or may not lead to the industry being forced to swallow some bitter medicine. But at least then it can get on with moving forward rather than being frozen like in 1973, which many labelled the real British winter of discontent, as opposed to the officially credited year of 1979.