The government’s plans to overhaul its regulatory approach will “reshape” financial services in the UK, Bovill Newgate has warned.

In her inaugural Mansion House speech, Chancellor, Rachel Reeves, unveiled the government’s plans for a new regulatory landscape that sought to shift towards fostering economic growth, competitiveness, and investment.

However, Bovill Newgate, an Ocorian company, questioned whether this new growth-orientated focused would become too ‘light touch’.

The Mansion House speech outlined several initiatives that aimed to reduce the regulatory burden on authorised firms while encouraging innovation and investment.

These included consultations on reforms such as the removal of the Certification Regime, an overhaul of the Financial Conduct Authority’s (FCA) Handbook, and a consultation on targeted improvements in financial advice and guidance.

The Treasury also issued growth-focused directives to the FCA, Prudential Regulation Authority, and Payment Systems Regulator.

Initiatives seeking to strengthen the UK’s position as a global financial hub were included, such as a new stock market platform PISCES, blockchain innovation, support for mutuals and credit unions, and a focus on fintech.

Furthermore, Reeves reiterated the government’s intent to ‘reset’ its relationship with the European Union (EU) without re-entering the single market.

“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,” commented Bovill Newgate senior consultant, Robert Irvine.

“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.”

Bovill Newgate US practice lead, Portia Amato, 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.”

---