The King’s Speech is a test of whether the UK is serious about growth
For the government to prove it means what it says about growth, it should include a Financial Services Bill in the King’s Speech, says Miles Celic
When the King’s Speech is delivered in the coming weeks, it will be read as a signal not just of legislative intent, but of economic credibility. For a government that has put growth at the centre of its mission, the question is simple: will the speech contain the tools needed to do the job?
One of those tools should be a Financial Services Bill. This offers the opportunity for a compelling statement about the important role financial and related professional services play in enabling growth across the country and the government’s commitment to act decisively to support it.
Financial and related professional services are not just a ‘City’ or ‘London issue’. They are a national success story. The industry generates more than one tenth of UK economic output, delivers Britain’s largest net export surplus, and employs almost 2.5m people in towns and cities across the country. And Britain is the world’s most successful net exporter of financial services, with half those exports coming from outside the M25. This activity and employment directly supports local economies and enables wider economic growth. When financial services thrive, investment flows more easily, businesses grow faster and households are better served.
Yet, the uncomfortable truth is that growth in the industry has stalled. Over the past decade, output has flatlined while other global financial centres have moved with greater pace and confidence. They are reforming and legislating to simplify regulatory frameworks, providing clarity in emerging areas, driving innovation and vying hard to attract internationally mobile capital and talent. The UK has made progress, but as we made clear in our recent ‘No time to lose’ report with PwC, not at the speed, scale or ambition needed to keep ahead.
Meaningful change
This is why the King’s Speech matters. Incremental reform alone will not address structural issues that have built up over years. In several key areas, meaningful change requires primary legislation.
One example is redress. The Financial Ombudsman Service plays a vital role in protecting consumers, but uncertainty around how rules are applied has created unpredictability that ultimately harms consumers and firms alike. Clearer statutory footing would help restore confidence while maintaining high standards of protection.
Another is accountability. The Senior Managers and Certification Regime (SM&CR) was designed to strengthen responsibility at the top of organisations, an objective the industry supports. But in practice, the regime has become complex, duplicative and a growing barrier to attracting and retaining senior talent. The government has rightly set an ambition to reduce the burden, but that ambition cannot be delivered fully without legislative change as made clear in the government’s recent SM&CR reform package. More broadly, legislative change must be matched by further progress on reducing the cost and complexity of the UK’s regulatory environment, including removing duplicative requirements, embedding greater proportionality, and streamlining supervisory data requests.
In a world where capital and jobs can move quickly, friction matters. Other financial centres are acting with urgency, recognising that competitiveness is not static but dynamically contested. They are providing clear legislative signals on innovation, data, digital finance, tax and risk-taking. The UK cannot assume that its historic strengths alone will secure its future position.
In our ‘No time to lose’ report, which was the largest listening exercise conducted by industry in recent times, we made clear the prize for reforming at speed and with greater decisiveness and ambition. That is an additional £53bn in additional annual economic output by 2035 – equivalent to adding a city almost the size of Edinburgh and Glasgow combined to the UK economy each year. This would also help to stimulate growth and support the financial resilience of individuals and households up and down the country.
A Financial Services Bill should not be about lowering standards or deregulation by stealth. The UK’s reputation for rigorous regulation, trusted institutions and the rule of law remains one of its greatest assets. But resilience and growth are not in conflict. A simpler system that reduces compliance burdens while maintaining robust risk management will make the UK a more attractive destination for investment and innovation.
Perhaps most importantly, legislation provides certainty. Businesses invest when they have confidence. A Bill announced in the King’s Speech would demonstrate that reforms are not tentative or temporary, but part of a coherent long-term strategy to keep the UK one of the world’s leading financial centres.
The King’s Speech will set the tone for the parliamentary session and for the UK’s economic ambition. Growth does not happen by default. It is the product of clear choices, timely action, and credible delivery. Including a targeted Financial Services Bill would show that the government shares industry’s ambitions about both the urgency of the challenge and the opportunity at hand.
Miles Celic OBE is chief executive officer at TheCityUK