The Treasury has issued a warning to regulators that it will be radically reshaping and downsizing their role amid accusations that the current system “too often holds back growth”.
Chancellor Rachel Reeves said the government will aim to reduce the financial burden on businesses from regulation and administrative costs by a quarter by the end of this parliamentary session, announced in a policy paper on Monday.
The paper said the government does not currently have a “robust understanding of the cumulative cost of regulation on businesses” and will endeavour to understand the extent and seek to reform the relevant regulators to “remove unnecessary burden and achieve its policy objectives more efficiently”.
Among the largest issues identified is the duplication requirements from regulators. The government has claimed that poorly constructed regulation has forced businesses to waste time and effort providing the same information for different bodies.
A proposed solution is to merge the Office of the Regulator of Community Interest Companies (CIC) into Companies House.
Many of the concrete changes reforming the role of regulators will require legislation, which will be considered ahead of the upcoming 2025 Spending Review.
The announcement comes days after the Office for National Statistics (ONS) reported the economy unexpectedly shrank 0.1% in January.
The government has been signalling its intention to reshape the structure of regulators to support its growth agenda since its election campaign.
Recent communications have emphasised the mission of supporting growth and innovation as well as preventing bad behaviour within the role of regulators like the Financial Conduct Authority (FCA) and the Competition and Markets Authority (CMA).
The latter body saw the appointment of Doug Gurr, a former executive at Amazon, as its chair in a clear sign of the direction the government wants to take with its watchdogs.
Last week City Minister Emma Reynolds announced plans to retire the Payment Systems Regulator (PSR) – formed in 2015 – and absorb its responsibilities into the FCA, which the PSR sits within.
The prime minister also announced NHS England, a largely bureaucratic and administrative body overseeing health services on behalf of the Department of Health and Social Care.
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