On 13 December 2022, the Bank of England (the Bank) published a letter from Andrew Bailey, Governor, to Jeremy Hunt, Chancellor of the Exchequer, responding to the remit for the Financial Policy Committee (FPC).

The letter sets out the FPC’s response to the recommendations set out in the Chancellor’s letter of 17 November 2022 as well as the recommendation in relation to the government’s energy security strategy set out in a letter from the previous Chancellor on 7 April 2022. The FPC welcomes the recommendations made.

The FPC welcomes the Financial Services and Markets Bill. The FCA supports the measures contained in the Bill to implement the outcomes of the Future Regulatory Framework Review, and the need to align with international standards to deliver UK financial stability.

The FPC also welcomes the Chancellor’s commitment to the effective regulation of financial services and the operational independence of the Bank. The operational independence of the Bank and regulators is an essential underpinning for the FPC’s primary objective to deliver UK financial stability and subject to that, supporting the government’s economic policy objective of achieving strong, sustainable and balanced growth, and this is also a crucial component of the Uk’s attractiveness to internationally active financial institutions.