By William Schomberg
LONDON (Reuters) – British finance minister Rachel Reeves said on Monday she was pleased with moves to boost economic growth taken by two of the country’s top financial regulatory bodies as the government moves to cut red tape, including by axing some watchdogs.
Reeves and Prime Minister Keir Starmer promised voters in last year’s election that they would speed up the economy, but growth has remained stubbornly slow since then, putting pressure on the government’s spending plans.
Reeves told Reuters the Financial Conduct Authority, which oversees the City of London financial hub, and the Prudential Regulation Authority, part of the Bank of England, were responding to her call on watchdogs to make it easier to do business.
“I’ve been pleased by some of the progress at both the FCA and the PRA in supporting growth,” Reeves said in an interview having earlier on Monday met with several top regulators to push for more changes to streamline the rules for businesses.
Britain’s government said last week it would abolish the Payment Systems Regulator, which oversees some financial services issues and was the subject of complaints from businesses who must also follow PRA and FCA rules.
Reeves praised the FCA for dropping proposals for so-called name-and-shame rules and the PRA for postponing the implementation of the global Basel III rules on banks by a further year.
On Monday, the Treasury backed recommendations from the FCA and the PRA on setting up a concierge service for investors coming to the UK, changes to the limits on contactless payments and making it easier for people to get a mortgage.
Reeves said the abolition of the PSR along with National Health England – a body overseeing the state-funded health system – showed “the seriousness of our intent.” She declined to say how many other regulatory bodies might be axed.
The chairman of Britain’s competition watchdog quit in January after Reeves decided she needed someone aligned with her “strategic direction”, a push that has been given new urgency by U.S. President Donald Trump’s purge of business rules.
Many UK employers have said the government’s growth goal has been threatened not only by a tax increase on them announced at Reeves’ first budget in October but also be plans to offer workers more rights.
The head of the Confederation of British Industry welcomed Monday’s regulatory announcements but said it was “critical that this approach is reflected across the board including finding a landing zone for the Employment Rights Bill.”
Reeves said the government was working with business to get the balance right on employment rights and probation periods for new workers represented an important reassurance for business.
(Writing by William Schomberg; Editing by Toby Chopra)
