From the BBC:
Chancellor Alistair Darling does not plan fundamental reform of the way UK financial institutions are regulated.
Mr Darling has said that the current regulatory system is not to blame for the credit crunch, blaming instead the bosses of financial institutions." 
I find that utterly pathetic. Setting up a regulatory regime to prevent a set of events and then claiming that the regulatory regime is not at fault when one of the most severe of those events occurs is responsibility dodging of the highest order.
Regulation creates deadweight losses and distortions. Regulation will tend to make people believe that an activity is less risky and therefore encourage participants to take more risks. If the regulation is ineffective at controlling risk, which seems to be the admission in this case, then it can end up being seriously counter-productive and in that case, if you aren't prepared to amend it, you should seriously consider getting rid of it.