UK Government Unveils Major Regulatory Reform to Boost Growth

Regulatory Overhaul: Key Changes for Industry

Cutting Bureaucracy and Reducing Costs

The government has pledged to cut administrative costs for businesses by 25% by the end of Parliament. A key step in achieving this is a baseline review of regulatory costs, ensuring that compliance requirements are proportionate and effective.

Additionally, the consolidation of regulatory bodies is underway. The Payment Systems Regulator will be merged with the Financial Conduct Authority (FCA), and multiple employment rights enforcement bodies will be combined into a new Fair Work Agency. This aims to reduce duplication and create a more efficient system for businesses.

Reforms in Chemical and Environmental Regulations

Significant changes are coming to UK REACH, the chemicals regulatory framework. The government will cut fees by £40 million over six years and consult on recognising international chemical approvals to streamline market access.

Environmental regulations will also be modernised to facilitate major infrastructure projects. This includes:

• Faster approvals for low-risk activities in environmental permitting.
• A lead regulator model for major projects to avoid delays caused by multiple regulatory bodies.
• A new digital system to centralise planning and environmental applications.

Encouraging Investment and Innovation

The reforms aim to reduce uncertainty by clarifying regulator roles and responsibilities. This will include:

• Simplifying Ofgem’s duties to prioritise economic growth and consumer protection.
• Strengthening financial services regulation, including a review of the Financial Ombudsman Service (FOS) to ensure it supports business growth.
• Fast-tracking regulatory approvals through paid “fast lanes” in industries where speed-to-market is critical.

The Regulatory Innovation Office (RIO) has also been launched to identify and remove regulatory barriers to innovation, particularly in AI, digital healthcare, and advanced manufacturing.