(Bloomberg) — The UK government said it’s prepared to push through more reforms to make regulators prioritize finance industry growth, the latest salvo in an ongoing rift between ministers and the Financial Conduct Authority.
The FCA has faced criticism including from Chancellor of the Exchequer Jeremy Hunt in recent weeks, particularly over a plan to ‘name and shame’ firms under investigation at an early stage. The government has said that policy contradicts the FCA’s secondary objective — which the government legislated for last year — to work to make the City more competitive.
“We will go further if needed if things are not developing in the way that we would all like to see,” Treasury minister Bim Afolami said at an event in London on Wednesday. The regulators should adopt a “mindset” of growth, he said, adding that the industry doesn’t “feel that that shift has happened enough.”
The ruling Conservative Party and Britain’s financial regulators have been increasingly out of step since Brexit, with senior politicians frustrated at the perceived intransigence of the FCA as the government seeks upsides from leaving the European Union. Hunt’s criticism of the ‘name and shame’ policy came shortly after Business Secretary Kemi Badenoch had attacked plans to force financial firms to publish gender and ethnicity data.
On the regulator side, though, the political pressure has run counter to efforts to uphold high standards that are seen as one of the UK finance industry’s key attractions. Afolami said he’ll wait to see how the FCA and Prudential Regulation Authority report on the growth goal before taking any next steps.
“It’s important to give them time,” he said. “I want to monitor how the new system beds in.”
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