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HM Treasury unveils action plan to cut the cost of regulation for businesses

Mar 21, 2025 | HM Treasury (HMT)

Link(s):Radical action plan to cut red tape and kickstart growth – GOV.UK
A new approach to ensure regulators and regulation support growth – GOV.UK
New approach to ensure regulators and regulation support growth (HTML) – GOV.UK

Context

The Chancellor of the Exchequer, Rachel Reeves, has met senior figures from a wide range of UK regulators to outline plans to cut the administrative cost of regulation on businesses by 25%. The FCA and the PRA were both represented at the meeting. The plans include the ‘streamlining’ of more regulators (so, much like the PSR, they will cease to exist), and cut across many business sectors (not just financial services). The financial services plans within the published announcement build on the Chancellor’s Mansion House speech last year and the ‘remit letters for growth’ sent to the FCA and the PRA, include the creation of a ‘concierge service’ to help overseas firms get to grips with UK regulations to make it easier for firms to navigate the UK regulatory landscape and create broader barriers to entry.

Key points to note and next actions

The plan contains a number of key pledges from regulators, those from the FCA and the PRA being:

FCA:

  • Provide a dedicated case officer to every firm within the FCA’s regulatory sandbox.
  • Provide 50% more dedicated supervisors to early and high growth firms, to help them navigate the regulatory system and support their growth.
  • Extend pre-application support to all wholesale payments, and crypto firms.
  • Indicate more often that the FCA is ‘minded to approve’ start-ups to help them secure funding.
  • Simplify its mortgage and advice rules to support greater home ownership.
  • Work to review the contactless payment limits, including removing the £100 limit on individual payments.
  • Accelerate a review of capital requirements for specialised trading firms.

FCA and PRA:

  • HMT will review the FCA’s and PRA to rationalise them and ensure a focus on their priorities.
  • Reduce regulatory reporting requirements for firms.

PRA:

  • The PRA will consult this April on a matching adjustment investment accelerator aimed at reducing the time between life insurers identifying a productive investment opportunity and making that investment.

One of the five pledges from the ICO is to develop new guidance on international data transfers to support frictionless trade across borders. The ICO will also update its transfer risk assessment tools to underpin the Data (Use and Access) Bill reforms to create a more proportionate and risk-based regime.