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Britain’s payment supervisor will be repealed by Sir Keir Starmer as part of his push to increase growth by destroying or joining some of the country’s works with about 130 regulators.
The prime minister said his decision to remove the regulator of payment systems and join his operations with the financial behavior authority will help reduce the overlap and complexity in the British regulatory system and stop it from acting as a block on innovation, investment and growth.
“For a long time, the previous government hid behind regulators – pushing decisions and allowing regulations to blow and block a significant increase in this country,” Starmer said on Tuesday.
But his choice for PSR, which has 160 employees and already shares elderly staff and an office with FCA, is a sign of the challenges that Starmer has faced in proper adjustment.
Starmer has told the ministers to audit all regulators to see which bodies may be allocated. “It has not been as easy as they thought,” said a senior government official.
The prime minister is not expected to appoint other victims of his regulatory withdrawal when giving a speech on the creation of a “more agile state” later this week, according to officials.
PSR, which has a 28m budget for the current financial year, is set to join FCA after the government has approved primary legislation to approve the change. The UK financial regulator will hold the powers of the payment agency after the Union, the government said.
Some officials doubt whether the destructive process and requires time to officially destroy the PSR will be worth it when a FCA branch is in force.
The PSR is located in the same headquarters of FCA in Stratford, the East of London. Since last year, the payment supervisor has been led by David Gele, a FCA director. The government has also given more responsibility for FCA payments in recent months.
Charles Randell, the former head of the FCA, said the unification of regulators “may be a pleasant thing to do” for the government, but he added: “I do not think he would produce payback in the life of this parliament.”
“He assumes an organizational processing that can mean two years in which little is done, but in the end people are doing the same while wearing different signs,” said Randell, who is now a high consultant at the Slaoughter and May Legal Firm.
Businesses have complained about some SPR decisions in recent years as its critics show that some other countries have a special payment guard.
Created in 2013 to encourage innovation and competition in the sector, PSR suffered a quick reaction to how it presented a mandatory reimbursement system for payment fraud last year.
Banks proposed for the regulator will have to pay victims of fraud up to 415,000. Heavy lobby eventually forced him to pull down, lowering the threshold to £ 85,000 at eleven o’clock.
Last week, Visa and the revolt raised legal challenges against the PSR, arguing that it had overcome its powers with a proposed cap for international transaction fees.
James Daley, head of the Fairer Finance Customer Group, said PSR “was widely criticized as a regulator” and “would not be such a jump” for most of his activities that would be folded into FCA.
John Glen, the city minister under the previous conservative government, said he had sympathy with the desire to reduce the number of regulators, but warned “all changes brings a long delay in disruption which is rarely useful.”
The United Kingdom government said the SPR will continue to access its legal powers until the legislation is adopted to join it with the FCA.
Starmer wrote some regulators at the end of last year, asking them to propose pro-growth measures. In January, ministers pushed the head of the Competition and Market Authority after deciding that he was insufficiently increasing.
Ministers are also pressuring changes to the Financial Service of the Ombudsman, who deals with consumer complaints about the sector and has set fire to be too fast to reinterpret the regulation. FOS chief executive recently left and her chair will withdraw this summer.
Chancellor Rachel Reeves said the removal of the PSR was part of a wider movement for the free business from the “stranglehold” of the regulatory system, which “has become heavy to the point of increasing innovation, investment and growth”.
Nikhil Rathi, the chief executive of FCA, said the combination of the two regulators was “another natural step after the latest work to improve coordination and clarity in regulatory responsibilities”.
SPR said: “The legislation will take time, but we do not need to wait to realize the benefits of an even more simplified regulatory approach.”
