By Charlie Conchie
A number of the government’s flagship City reform efforts including the roll-out of the British ISA and so-called Pisces private market have been thrown into doubt by Rishi Sunak’s gamble to hold an early election in July.
Ministers have been pushing ahead with a slew of changes to City policy over the past two years, but consultations on some of the landmark plans now risk being kicked into the long grass as both parties shift into election mode.
Treasury sources confirmed yesterday that the government has already shelved the much-touted retail sale of its stake in Natwest, which had been talked up as a moment to revitalise retail investment in the UK.
After the Chancellor Jeremy Hunt announced plans for a British ISA, which aims to encourage British investors to back the stock market via tax breaks, the Treasury launched a consultation to run until the 6th June.
However, any response to the consultation will now be delayed until after the election.
Labour has so far remained quiet on the plans and it is unclear whether the party will back the reforms if elected to power. Labour did not respond to multiple requests for comment.
“Everything is under review,” a Treasury source told City A.M.
Among the other measures now shrouded in uncertainty are the so-called Pisces market, a new hybrid public-private stock exchange designed to allow companies to sell their shares in a style akin to a public market.
Under plans being drawn up in conjunction with the London Stock Exchange, ministers had been aiming to launch the market at the back end of this year.
“The Pisces platform will give private companies better access to UK capital markets, break down the artificial regulatory cliff edge that exists between the public and private markets,” the City minister Bim Afolami said earlier this year.
However, a consultation on the plans ran until the 17th April and the Treasury is yet to publish a response. Labour has not formally backed the plans and the Treasury did not respond to a request for comment on whether it was still likely to go ahead.
The election means that several strands of the government’s landmark package of City reforms have been thrown into turmoil in a potential blow to the Conservative party’s pitch to business.
While areas like changes to listing rules will go ahead as planned this summer, several key areas of the reform package like the still sit with the Treasury and are therefore at risk of being derailed. Jeremy Hunt was also expected to provide a further update on his plans to unlock pension investment at the annual Mansion House summit in July.
The snap election has disrupted the government’s plans wider legislative plans and forced parliament into a so-called wash-up period, in which it prioritises a small number of bills to be pushed through before it is prorogued tomorrow.
