Regulation is ‘a boot on the neck of businesses’, Rachel Reeves to warn at Mansion House
Financial services regulation is “a boot on the neck of businesses,” Rachel Reeves is expected to say as the Chancellor delivers her annual Mansion House speech later today.
Reeves will urge watchdogs to “take up the call” of regulating for growth rather than “bend to the temptation of excessive caution” as she seeks to showcase her business-friendly credentials to top City execs.
“We have been bold in regulating for growth in financial services and I have been clear on the benefits that that will drive,” the Chancellor is expected to say.
“As I look ahead it is clear that we must do more. In too many areas, regulation still acts as a boot on the neck of businesses, choking off the enterprise and innovation that is the lifeblood of growth.
“Regulators in other sectors must take up the call I make this evening, not to bend to the temptation of excessive caution, but to boldly regulate for growth in the service of prosperity across our country.”
Reeves’ push to get Britain investing
The remarks come as Reeves unveiled a campaign to encourage savers to invest in shares and bonds in a bid to boost household wealth and revive London’s ailing stock market.
Banks will lead the drive to highlight the benefits of retail investing as they will alert customers about investment opportunities and how to move cash from savings accounts to stocks and shares investments.
The Investment Association will help to drive the campaign, with the government vowing to fix a “tangled system of financial advice” and “lengthy risk warnings” that have made it harder for consumers to invest in the UK.
Treasury officials said stocks and shares had performed better than normal cash savings accounts, with savers putting £2,000 today into stocks and shares likely to be some £9,000 better off in 20 year’s time on current trends.
Long term asset funds, a regulated investment structure that enables funding in illiquid assets such as real estate, will be included in stocks and shares ISAs next year, which will give Brits a stake in infrastructure developments.
But Reeves has stopped short of cutting the limit to cash ISAs, a move which would have forced households with large cash savings into other asset classes, after pushback from some consumer groups.