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Introduction: Reeves to meet regulators in drive to cut red tape
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The UK government has the regulators in its sights as it tries to squeeze more growth out of the economy.
Chancellor Rachel Reeves is to meet with representatives from financial, environmental and health regulators today, in a push to cut bureaucracy and lower the cost of regulation for business.
She’s expected to unveil an “action plan” to cut red tape by reducing the number of bodies which oversee sectors of the economy that are crucial to boosting growth.
Speaking ahead of the meeting, the chancellor says:
“Today we are taking further action to free businesses from the shackles of regulation.
“By cutting red tape and creating a more effective system, we will boost investment, create jobs and put more money into working people’s pockets.”
The meeting will be attended by the Financial Conduct Authority, Prudential Regulation Authority, the Environment Agency, Natural England, the medicines regulator and the Information Commissioners’ Office.
Between them, these regulators look to protect consumers, businesses, patients and the environment – but ministers seem determined to prevent them clogging up the economy.
The government’s message, as it surveys an economy that shrank slightly in January, is that “regulators must work for the people...not get in the way of progress”.
On the environmental side, the government hopes to stop infrastructure projects being delayed by protection demands – an issue highlighted recently by the £100m bat shelter built for the HS2 trainline.
The Treasury also plan to slim down the legal duties of regulators, such as those in financial services, energy watchdog Ofgem and water regulator Ofwat, “so that they do not waste time satisfying redundant duties”.
One body, The Payment Systems Regulator, has already felt Reeves’ axe – its abolition was announced last week.
Rain Newton-Smith, chief executive of the Confederation of British Industry, said the UK’s “Gordian knot of regulations” hindered investment with compliance costs that were too high “leaving us trailing the international competition”.
She said:
“Today’s announcement signals a shift towards a more proportionate, outcomes-based approach that should deliver more sustainable growth and investment.”
The agenda
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9am GMT: Italian inflation report for February
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10am GMT: OECD interim economic outlook
-
12.30pm GMT: US retail sales report for February
-
2pm GMT: US NAHB housing market index
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Trump: Both reciprocal and sectoral tariffs coming on 2 April
Hopes that US president Donald Trump might sway away from deepening his global trade war next month have taken a knock overnight.
Trump has insisted that reciprocal and sectoral tariffs will be imposed on US trading partners on 2 April, and also insisted that he has no intention of creating exemptions on steel and aluminum tariffs.
Speaking to reporters on Air Force One, Trump was asked if he would be imposing sectoral and reciprocal tariffs on 2 April, as has been previously suggested.
He replied “In certain cases, both,” adding:
“They charge us, and we charge them. Then, in addition to that, on autos, on steel, on aluminum, we’re going to have some additional.”
Reciprocal tariffs are taxes on imports to the US which are set at a similar rate to taxes other countries put on goods they import from the US, while sectoral tariffs would target a particular type of products – such as automobiles, steel, aluminum, microprocessors, and pharmaceuticals.
The comments are a sign that Trump is determined to press ahead with a more aggressive trade regime, despite having upset US allies – and spooked the financial markets – by announcing and imposing tariffs since returning to power.
Trump insists, though, that slapping tariffs on imports to the US makes sense:
“April 2 is a liberating day for our country.
We’re getting back some of the wealth that very, very foolish presidents gave away because they had no clue what they were doing.”
Starmer: I’ll cut regulation and unleash animal spirits
Sir Keir Starmer is promising to “bring back the animal spirits of the private sector” by cutting the burden of regulation.
Writing in City AM this morning, Starmer says “it is an outrage” that the government does not know how much it costs business to comply with regulations.
He is promising to lead the first government to baseline these costs, and cut them by 25% by the end of this parliament.
In a notably pro-business column, the PM says the government must “unleash the power of the private sector” if it is to deliver economic growth.
That, he says, means:
Entrepreneurs who work day and night to build a business from scratch. Family companies that have passed know-how across the generations. Iconic British companies employing thousands of people across all sectors. Investors who provide the capital and expertise that fuels growth and innovation.
Starmer adds that the government is “kicking off a short, sharp process” to identify regulators that can be cut or merged, as part of his drive to cut ‘quangos’, concluding:
Reshaping our state, our regulatory system, our economy, is not the work of weeks and months. It will take years of discipline, focus and a willingness to make tough choices.
But my government is taking on that challenge to bring back the animal spirits of the private sector, and to make Britain the best place in the world to start and build a business.
IoD welcomes 'rebalancing' of regulation
The Institute of Directors has welcomed the government’s plan to shake-up regulation, calling it “a welcome shift to a more growth friendly approach”.
Dr. Roger Barker, director of policy at the Institute of Directors, says:
“Compliance with burdensome regulation is frequently cited by IoD members as one of the top factors having a negative effect on their businesses. Although well-designed and proportionate regulation has a valuable role to play in a modern economy, the current UK framework does not sufficiently prioritise growth and innovation. It is hence appropriate for the government to rebalance its approach with a pro-business orientation at its core.
“In our Spending Review submission in February, the IoD called on the government to reinstate a Business Impact Target for new regulation over the life of the Parliament. We are therefore delighted that the government has listened to this recommendation and is now committed to reducing the administrative costs of regulation on business by 25% through this Plan. Meaningful progress against this target will be crucial for supporting businesses and growing the economy.
“In addition to the measures announced today, we would also like to see the government apply more rigorous and timely impact assessment procedures when considering new regulation. Non-regulatory solutions should always be considered, and the business case for new regulation should be subject to proper independent scrutiny by the Regulatory Policy Committee. There should also be a commitment to reviewing the ongoing effectiveness of existing regulation at regular intervals.”
Rachel Reeves is expected to use today’s meeting to unveil 60 measures that regulators have agreed to undertake to boost economic growth.
The BBC had a handy list of what’s expected:
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Fast-tracking new medicines through a pilot to provide parallel authorisations from healthcare regulators
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Reviewing the £100 cap on individual contactless payments
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Simplifying mortgage lending rules to make it easier to re-mortgage with a new lender and reduce mortgage terms
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Setting up a ‘concierge service’ to help international financial services firms navigate regulations
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Civil Aviation Authority permitting at least two more large drone-flying trials for deliveries in the coming months - which the government said has already cut travel times for blood samples between hospitals from 30 minutes down to two minutes
Introduction: Reeves to meet regulators in drive to cut red tape
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The UK government has the regulators in its sights as it tries to squeeze more growth out of the economy.
Chancellor Rachel Reeves is to meet with representatives from financial, environmental and health regulators today, in a push to cut bureaucracy and lower the cost of regulation for business.
She’s expected to unveil an “action plan” to cut red tape by reducing the number of bodies which oversee sectors of the economy that are crucial to boosting growth.
Speaking ahead of the meeting, the chancellor says:
“Today we are taking further action to free businesses from the shackles of regulation.
“By cutting red tape and creating a more effective system, we will boost investment, create jobs and put more money into working people’s pockets.”
The meeting will be attended by the Financial Conduct Authority, Prudential Regulation Authority, the Environment Agency, Natural England, the medicines regulator and the Information Commissioners’ Office.
Between them, these regulators look to protect consumers, businesses, patients and the environment – but ministers seem determined to prevent them clogging up the economy.
The government’s message, as it surveys an economy that shrank slightly in January, is that “regulators must work for the people...not get in the way of progress”.
On the environmental side, the government hopes to stop infrastructure projects being delayed by protection demands – an issue highlighted recently by the £100m bat shelter built for the HS2 trainline.
The Treasury also plan to slim down the legal duties of regulators, such as those in financial services, energy watchdog Ofgem and water regulator Ofwat, “so that they do not waste time satisfying redundant duties”.
One body, The Payment Systems Regulator, has already felt Reeves’ axe – its abolition was announced last week.
Rain Newton-Smith, chief executive of the Confederation of British Industry, said the UK’s “Gordian knot of regulations” hindered investment with compliance costs that were too high “leaving us trailing the international competition”.
She said:
“Today’s announcement signals a shift towards a more proportionate, outcomes-based approach that should deliver more sustainable growth and investment.”
The agenda
-
9am GMT: Italian inflation report for February
-
10am GMT: OECD interim economic outlook
-
12.30pm GMT: US retail sales report for February
-
2pm GMT: US NAHB housing market index
