Economists’ competitiveness letter

Abstract

We, the undersigned, are writing to express our concern about proposals for the UK’s Financial Services Future Regulatory Framework (FRF) to give regulators statutory objectives to promote “competitiveness” after Brexit. The Economic Secretary, John Glen MP, rightly called the FRF a “once-in-a-generation opportunity” to set the course for post-Brexit regulation. The FRF says the government intends “a greater focus on growth and competitiveness by introducing new, statutory secondary objectives for the PRA (Prudential Regulation Authority) and the FCA (Financial Conduct Authority).” Chancellor Sunak has said that UK finance should be “globally competitive over the long term.” We wholeheartedly support the government’s aim to stimulate long-term UK economic growth, including through financial regulation. Yet we believe that competitiveness is an inappropriate objective for regulators, for the reasons below.