FCA unveils plans to remove ‘unnecessary regulation’ in letter to prime minister

The FCA has detailed plans to remove “unnecessary regulation” and support growth in a letter to the government.

The letter, which was written by FCA chief executive Nikhil Rathi, said that the regulator wanted to work the government in a “fundamentally different way to support the growth mission”.

It came in response to a letter from chancellor Rachel Reeves in late 2024, with her stressing to the FCA that growth “is the defining mission” of the government and that there must be “proportionate, effective regulation”.

“[This must allow] firms of all sizes to compete, innovate and grow, create a stable, attractive environment that encourages business to establish and expand in the UK and adequately protects consumers,” the chancellor said.

In his letter addressed to the chancellor and prime minister Keir Starmer, Rathi said the FCA wanted to “remove unnecessary regulation and reduce how much data some firms must provide”.

This includes streamlining its handbook and improving accessibility and efficiency with a machine-readable version, working with the Bank of England/PRA to reduce reporting burdens for firms and making the senior managers and certification regime more flexible.

Rathi also detailed plans for Consumer Duty, a set of regulations that require firms to review their products and services against a new standard of fairness.

Reforms include removing the need for a Consumer Duty board champion, as well as ensuring future consultations on consumer protection ask if the Consumer Duty is sufficient rather than new rules.

Growth mission

This comes after Biba called for a more proportionate regulatory environment in its 2025 manifesto, which was launched last week (15 January 2025).

The trade body believes this will help brokers achieve the government’s secondary international competitiveness and growth objective.

Rathi stressed in his letter to the government that growth “will be a cornerstone of our strategy, through to 2030”.

“We want to collaborate with you in a fundamentally different way to support the growth mission,” he said.

“To achieve the deep reforms necessary, your acceptance that we will take greater risks and rigorously prioritise resources is crucial.”

He added that the FCA was “looking forward to working with the government and partners to rapidly progress” its work.