TaxPayers’ Alliance reveals dossier of barriers to growth imposed by major regulators

Embargoed: 10am, Tuesday 15th July 2025

The TaxPayers’ Alliance, a campaign group advocating for a significant reduction in the size of the quango-state, has published a dossier of ways in which six regulators impose barriers on economic growth, as senior officials from each body prepare to give evidence at the Business and Trade Select Committee.

Bosses from the Financial Conduct Authority (CA), Competition and Markets Authority (CMA), Prudential Regulation Authority (PRA), Ofgem, Ofwat and Environment Agency are today appearing in parliament to discuss the role of regulators. This comes as reports indicate that Rachel Reeves, the chancellor, will “pledge a bonfire of financial services regulation” in her Mansion House speech this evening.

The TPA’s dossier identifies ten ways in which these regulators hamper economic growth, including on issues such as consumer duty, price controls and merger regulation. This is part of the TPA’s Britain’s Quangos Uncovered project which aims to shed light on how many quangos there are, what they do, how much they cost, and the extent to which they meddle in our policymaking.

Ten ways regulators hamper growth:

Financial Conduct Authority:

• Consumer Duty

• • 50 per cent of financial advisers have stopped serving clients due to the burden of implementing Consumer Duty.
  • Increased compliance costs are disproportionate to the commercial benefits, leading to reduced service availability and higher costs for consumers.
    
    
• CP25/18 - Non-Financial Misconduct
• • A duplication of existing standards.
  • Adds unnecessary regulatory burden without measurable benefit, reducing focus on core financial oversight and increasing legal and compliance costs.
  • Clear example of mission creep.

Competition and Markets Authority

• Merger Regulation

• • Overzealous application of merger controls inhibits consolidation and scale-up, including in digital and tech sectors.
  • Reduces investment incentives and creates an unpredictable environment for business expansion.

Prudential Regulation Authority

• Capital Requirements under Basel Framework

• • One-size-fits-all approach limits growth financing, especially among domestic lenders who are not internationally active.
  • Disincentivises risk-based lending and innovation in SME and infrastructure finance.

• Regulatory Cost Transparency

• • No systematic review of the actual economic costs imposed by reforms.
  • Post-implementation assessments are needed to ensure proportionality and avoid unintended consequences.

Ofgem

• Regulatory Complexity

• • Cumbersome approval processes delay clean energy projects and grid upgrades, discouraging long-term investment.
  • Adds uncertainty and raises financing costs for infrastructure development.

• Price controls

• • Leave insufficient capital for reinvestment by utilities.
  • Undermine market signals and deters private sector involvement.

Ofwat

• Price Controls

• • As with Ofgem, price caps restrict the ability of water companies to raise capital and invest in resilience.

• PR24 Criticism

• • Investors say PR24 determinations ignore wider economic conditions, making the sector less attractive.
  • Undermines confidence and may reduce access to infrastructure capital.

Environment Agency

• Charging Regime

• • Businesses report charges for environmental permits are too complex and could discourage investment.
  • Risk of disengagement from compliance and environmental harm if firms exit regulated schemes.

Jonathan Eida, researcher of the TaxPayers' Alliance, said:

"Taxpayers will welcome any action the chancellor takes that hacks away at the vast forest of regulation that businesses have to contend with.

“But until Rachel Reeves truly takes on the regulators who do so much to restrict the UK’s economic potential, her plans are likely to be dead on arrival.

“Tinkering at the margins simply won’t be enough given the scale of the crisis. The chancellor needs to be bold and completely rewire the regulatory state.”

TPA spokespeople are available for live and pre-recorded broadcast interviews via 07795 084 113 (no texts)

Media contact:

Elliot Keck
Head of Campaigns, TaxPayers' Alliance
[email protected]
24-hour media hotline: 07795 084 113 (no texts)

Notes to editors:

1. Founded in 2004 by Matthew Elliott and Andrew Allum, the TaxPayers' Alliance (TPA) campaigns to reform taxes and public services, cut waste and speak up for British taxpayers. Find out more at www.taxpayersalliance.com.
   
   
2. TaxPayers' Alliance's research council.
   
   
3. Senior representatives from the Financial Conduct Authority, Competition and Markets Authority, Prudential Regulation Authority, Ofgem, Ofwat and the Environment Agency are all appearing at a Department of Business and Trade select committee hearing on the role of regulators at 2:30pm today.
   
   
4. All the criticisms of regulators included in the dossier are sourced to expert analysis.