Ocorian warns new UK regulatory landscape will reshape financial services
- Reeves Mansion House address signals shift toward growth-driven regulation, says Ocorian’s Bovill Newgate, but will it be too light touch?
- Government intends to “reset” its relationship with the EU but will this secure a more stable investment climate for UK firms?
In her inaugural Mansion House speech as Chancellor of the Exchequer, Rachel Reeves unveiled the UK Government's plans to overhaul its regulatory approach, signalling a pivotal shift towards fostering economic growth, competitiveness, and investment, but, Bovill Newgate asks, will her new growth-orientated focus become too light touch?
In her address Rachel Reeves emphasised that “the UK has been regulating for risk, but not regulating for growth” intending to set the stage for a new era of growth-oriented financial oversight.
The speech outlined key initiatives aimed at reducing the regulatory burden on authorised firms while encouraging innovation and investment, including:
- Consultations on critical reforms: Joint efforts by the Treasury, FCA, and PRA to remove the Certification Regime and streamline pay deferral requirements.
- FCA Handbook overhaul: A comprehensive review to remove duplications and simplify compliance for firms
- Financial advice transformation: FCA-led consultation targeting improvements in financial advice and guidance.
To further align regulatory objectives with economic priorities, the Treasury has issued growth-focused directives to key bodies, including the FCA, PRA, and Payment Systems Regulator.
The Chancellor also unveiled ambitious initiatives designed to strengthen the UK’s position as a global financial hub, including:
- New stock market platform: PISCES, a stock market for scaling companies, to launch by May 2025.
- Blockchain innovation: The Digital Gilt Instrument (DIGIT) pilot will adopt distributed ledger technology.
- Support for mutuals and credit unions: Creation of an industry-led Mutuals Council and consultations on modernising the mutuals landscape.
- Fintech focus: A national payments vision to propel Open Banking and fintech advancements.
Reeves reinforced the Government’s intent to “reset” its relationship with the European Union without re-entering the single market, aiming to secure a stable investment climate for UK firms.
Robert Irvine, Senior Consultant, Bovill Newgate, commented: “This forward-looking approach aims to reduce regulatory costs and provide fresh opportunities for financial services providers, but whether it will prove too light touch is yet to be determined. While change is on the horizon, firms must navigate this evolving landscape strategically and with a risk based approach in mind.
“The removal of the Certification Regime is likely to be welcomed by firms, there will be interest in what will replace it and if it will actually reduce the current administrative burden.”
Portia Amato, US Practice Lead, Bovill Newgate added: “The stated intent from the Government to reset its relationship with the EU is wisely timed given the potential enhanced protectionism the global investment climate is likely to witness as the US President Elect makes his mark in 2025.”
Bovill Newgate specialises in guiding firms through complex regulatory environments. With its global expertise and tailored solutions, Bovill Newgate is ready to help clients adapt to these changes, seize growth opportunities, and maintain compliance with confidence.
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