Former FCA chair: Labour can rebuild ties with regulator after ‘depressing’ Tory turmoil

The Labour party can rebuild ties with the City regulators if elected to government after a fractious breakdown in relations marked by “political point-scoring”, the former chair of the Financial Conduct Authority (FCA) has claimed.

Charles Randell, who stepped down as chair of the City watchdog in 2021 and signed a letter backing the Labour party this week, said the Square Mile craved “stability and predictability” after a tumultuous period defined by barbs from Westminster towards the FCA and the banking regulator, the Prudential Regulation Authority.

“If Labour wins the election, it will bring a period of stability to replace the constant changes of political leadership that have been such a depressing feature of this Conservative government,” Randell told City A.M.. “Stability and predicability are what the financial services businesses and their investors crave.”

The political intervention from Randell, a previously impartial regulator at the FCA, is likely to be a boon for the party after a major charm offensive on the City in recent months.

Under shadow chancellor Rachel Reeves and shadow City minister Tulip Siddiq, Labour has been looking to woo financial services firms in a campaign dubbed the “scrambled eggs and smoked salmon” offensive in the City.

Randell was among 120 business chiefs to back Labour in a letter this week. However, the Conservative government has poured scorn on the party’s efforts to win the affections of business.

After Labour launched its plans for the City in January, the former Tory City minister Andrew Griffith claimed Reeves had tried to copy the government’s plans.

“Whilst any U-turn to copy our reforms is welcome, Labour’s approach to the UK’s Financial Services sector is like a dog-food lasagne,” said the former City minister Andrew Griffith. “Sort of looks the same and may even fool some people but you really wouldn’t prefer it!”

Under the plans launched by Siddiq in January, the party said it would be looking to shake-up the financial regulators and slim down the rulebook used by the FCA.

Among the plans would be a push to “tackle bureaucracy, overlap and inefficiencies” across the City’s main regulators, Labour said.

Randell added that he did not “expect Labour to agree with everything that independent regulators suggest, but there’s a chance to improve the quality of the dialogue and change the tone”. 

“It damages the UK when international investors see political point-scoring against our institutions,” he added.