New Chancellor hints at regulatory reform
The newly-appointed Chancellor of the Exchequer is keeping an open mind about regulatory reform in the UK, and has not ruled out government intervention on financial regulation issues if it is in the public interest.
In his maiden speech at Mansion House last night (19 July), Chancellor Nadhim Zahawi highlighted the impact of the “landmark” Financial Services and Markets Bill which is due to be introduced today.
The bill repeals repeal hundreds of pieces of retained EU law, and gives the Financial Conduct Authority (FCA) more responsibilities. These include a new secondary objective at both the FCA and the Prudential Regulation Authority (PRA) “to facilitate growth and competitiveness.”
“I know that some people will say that making this a secondary objective, doesn’t go far enough,” Zahawi said.
Read more: 197 firms lost FCA permissions last year
“Others will say that having it as an objective at all, goes too far.
“We are, I think, taking a balanced approach.
“By making growth and competitiveness a formal objective, we’re encouraging a greater focus on our medium to longer-term productivity.
“But, by making it secondary, we’re giving the regulators an unambiguous hierarchy of objectives…with financial stability and consumer protection, prioritised.”
Read more: TISA welcomes smart data inclusion in data protection bill
He added that the bill also includes new measures to increase the regulators’ accountability and relationships with the government and other stakeholders.
Zahawi acknowledged that there has been some speculation about the government taking further powers to intervene in financial regulation, if it is in the public interest.
“That is something we’re looking at and I’m keeping an open mind,” he said.
Read more: FCA chief paid £455k during year of staff pay disputes