The UK government’s legislative priorities for the coming year, including bills focused on data reform and financial services, have been presented in the Queen’s Speech.
The set-piece address was delivered today (10 May) by Prince Charles on behalf of the Queen, with the overall package comprising a programme of 38 different bills.
The Conservative government’s overarching priority “is to grow and strengthen the economy and help ease the cost of living for families”, the heir to the throne told Parliament.
The speech highlighted some of the laws that PM Boris Johnson’s ministers want to pass during 2022-2023. Many bills – most obviously the ‘Brexit freedoms bill’ – are seeking to evolve UK laws to take into account the country’s exit from the European Union (EU).
Bills of most relevance to the fintech sector include a data reform bill that seeks to create new UK data protection laws and capitalise on the opportunities of smart data, as well as a financial services and markets bill. The latter includes new laws to ensure the continued availability of cash withdrawal and deposit facilities, as well as to enable the Payment Systems Regulator to require banks to reimburse authorised push payment (APP) scam losses.
Further bills include an economic crime and corporate transparency bill, online safety bill and a procurement bill, which seeks to provide greater opportunities for smaller companies in government tenders.
Smart data’s possibilities
Reacting to the speech, the Open Data Institute (ODI) said in a tweet that reforms to improve UK financial services ‘should build on the success of open banking’ and that ‘there must be wider participation in smart data initiatives, with strengthened accountability to consumers and affected communities’.
Open banking makes use open application programming interfaces (open APIs) to allow people to access and use their banking data to access innovative services. Smart data captures, more broadly, the same spirit of data access, use and portability.
Charlotte Crosswell, chair and trustee of the UK’s Open Banking Implementation Entity (OBIE) – which is overseeing the UK’s open banking journey – said: “The inclusion of smart data legislation brings us one step closer to expanding the benefits of open banking to other sectors of the economy, including energy, telecommunications and pensions. It will put consumers and small businesses in control of their data and drive much-needed innovation and competition.”
OBIE was established in 2016 by the CMA, a non-ministerial government department, with the country’s nine largest current account providers (known as the CMA9) required to create and pay for it. “Smart data will allow the government and regulators to mandate similar participation in other sectors, and will deliver real cross-sector benefits by creating an interoperable framework for data sharing,” Crosswell said. “Data can unlock a whole suite of benefits for consumers and small businesses and can be mobilised to combat the increase in cost of living through better access to credit, increased competition between incumbents and supporting new market entrants, and better management of household and company bills.”
Time to ‘move beyond’ open banking
The reaction of Harry Weber-Brown of The Investing and Saving Alliance (TISA), which has more than 200 member firms, was similar to Crosswell’s, saying that it was “really encouraging to see” smart data’s inclusion. “Smart data and open finance will revolutionise the way we access financial services, and we are pleased that the government is determined to support this,” he said.
“We believe the time is right to look forward and move beyond open banking by incorporating open savings, investments and pensions [OSIP] in our ambition to provide broad digital access to the full scope of financial services,” Weber-Brown continued. “With the consumer’s request, OSIP will enable fintechs and other financial institutions to access savings, investment, and pensions data via APIs, enabling data sharing in a secure environment, utilising data standards and optimising the user experience.”
UK Finance, meanwhile, welcomed the financial services and economic crime bills. The banking lobby group’s chief executive described them as “two key pieces of legislation”.
David Postings said the former bill “provides the opportunity to tailor the UK’s regulatory framework and so create a more competitive financial services sector post-Brexit, supporting jobs and investment across the country”, while the latter would be “critical in helping to address money laundering and the growth in fraud and scams, which are now the most prevalent type of crime in the UK”. He added that this bill “should focus on measures that prevent fraud happening in the first place and provide greater enforcement powers to tackle those who commit economic crime”.
The Queen pulled out of delivering the speech due to ‘episodic mobility problems’.
FURTHER READING
‘Open finance: phased rollout better than ‘big bang’ launch, UK’s FCA told’ – our news story (9 April 2021) on theFinancial Conduct Authority publishing a ‘feedback statement’ summarising 169 responses to a call for input on open finance
