Labour: We’ll ‘unashamedly champion’ financial services as party plots rulebook reform
Labour has unveiled sweeping plans to shake up financial regulation and boost the growth of the City today as shadow chancellor Rachel Reeves said when the “sector succeeds, we all succeed”.
In new proposals for the UK’s financial services sector published today, Labour said it would look to “modernise the regulatory burden” on UK financial firms and push City watchdogs to identify and cut “redundant” rules that have hampered the growth of the sector.
Among the plans would be a push to “tackle bureaucracy, overlap and inefficiencies” across the City’s main regulators, Labour said, including a drive to streamline the Financial Conduct Authority’s “10,000 page regulatory handbook”.
The plans mark Labour’s most direct intervention in the City to date and signal a major charm offensive to try and win round the sector ahead of an election.
Writing in Morning Wire today alongside the announcement, Shadow Chancellor Rachel Reeves and Mayor Sadiq Khan said in a joint article that the industry “generates billions of pounds of wealth for our nation” and “when the sector succeeds, we all succeed”.
“The UK is a world-leader in financial services – something we should be proud of and continue to champion,” Reeves and Khan wrote.
In a statement, Reeves added that Labour would “unashamedly champion” the City in government.
Labour has launched a charm offensive on business in recent months to try and rebuild ties after the leadership of Jeremy Corbyn.
The plans have been spearheaded by shadow City minister Tulip Siddiq alongside a team of City grandees, including Abrdn chair Sir Douglas Flint, former FCA chair Sir Charles Randell and L&G chair Sir John Kingman.
In a comment shared by the party, Randell said Labour has provided “its blueprint for the inclusive and sustainable growth of the financial sector”.
Among the other proposals laid out by the party, Labour said it would look to bolster the growth of regional financial centres outside of London and strengthen financial security for consumers, with measures including the expansion of longer-term fixed rate mortgages and regulation of the Buy Now Pay Later sector.
The City is set to become a contested battleground ahead of an election after a troubling 12 months in which new listings in London have dried up and firms have snubbed London in favour of New York.
Conservative ministers have similarly pushed ahead with regulatory reform efforts to try and revive the UK’s appeal as a financial centre.
City minister Bim Afolami told Morning Wire’s Bonds & Ballots series last week the government was looking to spur a “rebirth of British capital” and “capital markets renaissance” by reforming regulation.
Since 2020, the government has commissioned deep dives spanning areas including listings, investment research and London’s secondary markets.
One City figure welcomed the proposals.
Miles Celic, Chief Executive Officer, TheCityUK, said: “Labour has set out a forward-thinking plan for financial services with a clear focus on innovation, modernising the regulatory landscape, driving more investment, and unlocking growth in the wider economy.
“It builds on the reforms that have been underway since Brexit. As an industry that provides highly-skilled jobs, high productivity and enables growth in all parts of the country, financial services is a strategic national asset and key to the UK’s future economic success.”