While my colleagues prepare to head off on holiday this week to parts of the world that are either on fire or full of apex predators it’s my turn to provide the weekly update. Exactly a year ago I first turned up at lang cat Towers with my new pencil case and a remit to spread the word about regulation to the wider community, whether they liked it or not. One year on, what have been the big stories and what’s going to be bothering us most in the near future?

Since last July we’ve had two monarchs, three Prime Ministers, four Chancellors of the Exchequer and one lettuce. Guy Opperman became the longest-lasting pensions minister, in office for 1,913 days, apart from a brief interlude on 7th July when no one was quite sure who the pensions minister, or indeed the government, actually was. There was one disastrous mini-Budget in September, one Spring budget in which the rabbit pulled from the hat was abolition of the lifetime allowance, and eight interest rate rises.

On the legislative front we had the Edinburgh reforms, positioned as an opportunity to take hundreds of pages of burdensome EU retained laws governing financial services and replace them with hundreds of pages of burdensome British laws governing financial services, but possibly with a blue cover.

Top of the FCA’s list has been the final publication of the rules on consumer duty (Wait! Come back!) and the plans for implementation – but that’s another update for another day. But possibly the biggest shift in regulation will be the Financial Services and Markets Act 2023 which received Royal Assent last week. This is the mechanism that really changes the goalposts for the regulators post-Brexit and gives them a whole new range of powers.

The FCA now has a strategic objective to make sure the markets function well, and three operational objectives of protecting consumers, protecting the integrity of the UK financial system and promoting effective competition between firms in the interests of consumers. Since last week it now has a secondary objective to consider the UK’s international competitiveness when making regulatory decisions. It’s not the first time regulators have had to take this into account, but this time it’s part of the government’s big plan to attract and keep financial services business in the UK. But it’s not without controversy. An excellent article in the Journal of Financial Regulation (one of the few academic journals to mention Carly Simon) warns that ‘a government wedded to the ideology of competitiveness is as unlikely to make good economic policy as a government committed to creationism is to make good science policy’. Consumer groups are concerned that it could result in lowering of standards, and the regulators themselves (the PRA has a similar objective) are very keen to point out that it’s a secondary objective, and they’ll not be leaned on to put the interests of business ahead of others in society.

That’s the big headline change, but there’s plenty of other stuff in the Act too. As you put the final touches to your value for money assessments (or stare at the oncoming consumer duty deadline like the heroine in a silent movie tied to the railway tracks) you may be pleased to know the Act contains a whole section on the accountability of the regulators as a counterbalance to their new powers, and in particular both the FCA and the PRA have to set up new Cost Benefit Analysis Panels, including representatives from regulated firms.

Looking back, that’s quite a seismic shift in regulation over one year, and in theory the next year should see the regulators and the industry spending their time on making it all work. But you can’t rule out a General Election (or, frankly, an alien invasion) sooner rather than later, so one of the key activities for those of us with an interest in such things will be watching all the political parties in the coming months to see which way the regulatory and legislative wind is likely to blow. Something to think about over the summer holidays.

#LANGCAT LINKS

• If you work in an advice firm and use a DFM MPS service then we’d love to hear what you think about your current provider.
• Harbinger of doom Tom McPhail has been considering expected pensions policy announcements in his podcat this week, along with the FCA’s retirement advice review and the ongoing problems with pensions transfers.
• Our friends over at Novia Group are aiming to raise £25,000 for charity by taking on the National Three Peaks Challenge later this month, climbing the three highest peaks in Scotland, England and Wales within 24 hours. To find out more, or to donate a few pounds to help some very worthy causes, visit the team’s GoFundMe page.
• This week’s musical link has no relation to anything to do with regulation but is just an absolute blast if you’re a fan of African cello music and throat singing, and who isn’t?

Thanks for reading.

Alison, senior public affairs consultant