HMT consultation response on cross-cutting reforms in the UK regulatory environment

HM Treasury (HMT) has published its consultation response on cross cutting reforms to the UK financial services regulatory environment. This follows its July 2025 consultation, which proposed changes to the legislative framework governing the operation of the UK financial services regulators, namely the UK Financial Conduct Authority (FCA) and the UK Prudential Regulation Authority (PRA).

Following feedback, the government confirms it will amend the Financial Services and Markets Act 2000 to:

• Set new, shorter statutory deadlines for determining applications for new firm authorisations, variations of permissions and senior manager approvals.
• Require the FCA and PRA to produce new long-term strategies, at least once every five years.
• Require the regulators to have regard to regulatory and supervisory principles, as well as remit letters (containing recommendations from HMT) when producing their new long-term strategies, while removing the requirement to consider these factors when making day-to-day decisions.
• Remove a range of lower-value reporting and procedural requirements placed on the regulators.

Other changes include shortening the deadlines for determining applications relating to regulatory requirements, financial promotion approvals and Senior Managers & Certification Regime (SMCR) variations. These measures will require primary legislation, which the government intends to bring forward when parliamentary time allows. Annex A to the consultation response sets out a full list of the procedural and administrative requirements to be amended.

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