- Chancellor to announce reforms to drive growth and secure the
UK’s position as world leading financial services hub in
Edinburgh today.
- Ringfencing rules are set to be updated to release banks
without major investment activities from the regime, regulators
will be given a new remit to deliver growth and a widespread
review will repeal hundreds of pages of EU law.
- The Government will continue to deliver reforms across the
economy to drive economic growth during challenging times.
In Edinburgh today the Chancellor, , will announce a package of
over 30 regulatory reforms to secure the UK’s place as the
world’s foremost financial centre.
The “Edinburgh Reforms” will build on the unparalleled strength
of the UK’s financial services sector, taking advantage of the
opportunities provided by the UK’s exit from the European Union
to tailor regulations to suit the country’s needs.
Today the Treasury will publish its plan to rigorously review,
repeal and replace hundreds of pages of EU regulation ranging
from disclosure for financial products to prudential rules for
banks, creating a tailor-made UK regulatory framework based on
international best practice that balances burden on business with
protection for the consumer.
Rules that hold back growth will be reviewed, with overbearing EU
rules which put companies off listing in the UK being overhauled,
among dozens of regulations within scope of the Financial
Services and Markets Bill.
The Government will also announce changes to ringfencing rules
which currently require major banks to separate their retail and
investment arms, and retail banks have to comply even if they
don’t have an investment arm, a time consuming regulatory
exercise.
Reforms will cut red tape and boost banking competition in
response to the Skeoch review by freeing retail focused banks
from ringfencing rules while maintaining protections for
consumers. The UK’s world leading regulatory regime has evolved
over the past decade and will continue to protect consumers and
safeguard financial stability.
Chancellor of the Exchequer, said:
“This country’s financial services sector is the powerhouse of
the British economy, driving innovation, growth and prosperity
across the country.
“Leaving the EU gives us a golden opportunity to reshape our
regulatory regime and unleash the full potential of our
formidable financial services sector.
“Today we are delivering an agile, proportionate and home-grown
regulatory regime which will unlock investment across our economy
to deliver jobs and opportunity for the British people.”
This builds on the reforms to Solvency II announced in the Autumn
Statement which will unlock over £100 billion for productive
investment from UK insurers over the next decade, such as clean
energy infrastructure.
The Chancellor is also expected to issue new mandates to the
Financial Conduct Authority and the Prudential Regulation
Authority setting out how they will help deliver growth and
promote the international competitiveness of the UK.
The financial services sector is vital for Britain’s economic
strength, contributing £216 billion a year to the UK economy.
This includes £76 billion in tax, enough to fund the entire
police force and state school system, while employing over 2.3
million people - with 1.4 million outside London and 163,000
people in Scotland.
While in Edinburgh today, the Chancellor will meet with top
financial services CEOs to discuss these reforms and how the
sector can further drive investment and growth in the UK.
As confirmed in the Autumn Statement, the government will look to
announce changes to EU regulations in four other growth
industries by the end of next year, including digital technology,
life sciences, green industries and advanced manufacturing.
Notes to editors
Further information:
- Edinburgh has a long history as a financial services hub,
since the founding of the Bank of Scotland in 1695. Today it is
the second largest financial centre in the UK, employing 53,465
people.
- Financial services is the biggest sectoral contributor to
Scotland’s economy, contributing £13 billion.
- There are more than 2,000 financial services businesses in
Scotland, supported by 3,650 professional services firms.
- Financial services and related professional services in
Scotland employ over 163,000 people.
