We invested significantly in implementing the Treasury’s Future Regulatory Framework, subsequently referred to as the Smarter Regulatory Framework (SRF). This work supported all our top-line outcomes and focused on creating confidence in financial markets.
In our 3-year strategy we said we would measure our success by how effectively and efficiently we replaced assimilated law with our rules, and how effectively we responded to any change in our remit, accountability arrangements or wider obligations.
All top-line outcomes but particularly Confidence
Outcome 1: The commitment supports all our top-line outcomes and creates confidence in financial markets
| Metric code | Metric description | Source | Baseline Value | Year 1 values | Year 2 values | Year 3 values | Latest status (year 3 value compared to baseline) |
|---|---|---|---|---|---|---|---|
PFS1-M01 This metric uses the same data as the top-line metrics CCO1-M01 and CNF5-M01 | In the longer term, when any legislative changes are fully implemented, increase in the proportion of consumers who slightly or strongly agree that they have confidence in the UK financial services industry. | FCA Financial Lives survey (FLS) | 41% of consumers (2020) | 41% of consumers (2022) | 43% of consumers (2023 re-contact survey) | 39% of consumers
| Declined |
| PFS1-M02 | Increase in firm’s perceived effectiveness of the FCA in regulating financial services. | FCA and Practitioner Panel survey | Scores on a 10-point scale; 7.1 all firms [7.2 (fixed firms) and 7.1 (flexible firms)] (2021) | Scores on a 10-point scale; 6.9 all firms [6.7 (fixed firms) and 6.9 (flexible firms)] (2022/23)
| Scores on a 10-point scale; 7.2 all firms [7.2 (fixed firms) and 7.2 (flexible firms)] (2023/24)
| Scores on a 10-point scale; 7.2 all firms [6.9 (fixed firms) and 7.2 (flexible firms)] (2024/25) Difference between year 3 and baseline value is not statistically significant for all firms or flexible firms but is statistically significant for fixed firms. | Little or no change |
| PFS4-M01 | Firms feel the FCA can adapt regulatory requirements to respond to innovation and new challenges | FCA and Practitioner Panel survey |
(2022/23) |
(2023/24) |
(2024/25) Difference between year 3 and baseline value is statistically significant for 'agree or strongly agree'. | Improved |
Outcome 2: Ensuring orderly replacement of firm-facing requirements in legislation in our Handbook
| Metric code | Metric description | Source | Baseline Value | Year 1 values | Year 2 values | Year 3 values | Latest status
(year 3 value compared to baseline)
|
|---|---|---|---|---|---|---|---|
| We will continue to assess and monitor the regulatory pipeline through the Regulatory Initiatives Forum and Grid, to understand the impact of the transfer on firms. | FCA repeal and replacement of assimilated law webpage, the Treasury's Smarter Regulatory Framework publications, Regulatory Initiatives Grid | At the outset of our 3-year strategy, we anticipated that around 40 pieces of assimilated law would fall within our scope. These would be repealed and, where appropriate, replaced by FCA rules. Over the course of the Strategy, we have been working on 12 assimilated law files and have measured our progress on these files. | 8 files started and remain in progress (2022/23) | 3 files started during 2023/24 and remain in progress alongside 8 files started during 2022/23. | We have been progressing 12 priority assimilated law files: 1 file started in 2024/25 and remains in progress alongside 11 files started during 2022/23 and 2023/24. 2 files have been completed. | Improved |
What the latest metric values tell us
Our commitment to prepare financial services for the future focused on:
- Embedding changes to the regulatory framework for financial services made by Parliament
- Tailoring requirements on financial services firms to better suit UK markets.
We made significant progress against these outcomes.
We embedded all the legislative changes introduced through the Financial Services & Markets Act (FSMA) 2023 to our objectives and accountability mechanisms. This included:
- the secondary competitiveness and growth objective.
- publishing our Cost Benefit Analysis (CBA) framework and establishing our new CBA Panel.
- launching our Rule Review Framework.
- implementing the new regulatory principle for net-zero and environmental targets.
On the programme of work to tailor requirements to UK markets, we worked on 12 assimilated law files in partnership with HMT. This included:
- proposals to make the consumer disclosure regime more targeted and proportionate.
- reforms to the commodity derivatives regulatory framework.
- improving the UK’s transaction reporting requirements.
- a new regime for public offers and admissions to trading.
The latest data shows an improvement in how firms feel the FCA can adapt to regulatory requirements to respond to innovation and new challenges. There has been no change in all firm's perceived effectiveness of the FCA in regulating financial services, and a small decline in consumers who have confidence in the UK financial services industry. However, the work for this commitment is long term and will take time to be reflected in our metrics. Various other overarching factors also affect them. The Putting consumer needs’ first commitment shares the ‘consumer confidence in the UK financial services industry’ metric and that section has more information about the other factors influencing the metric.