UK Financial Services

Debate between Callum Anderson and Kerry McCarthy

Tuesday 1st September 2026 Westminster Hall

[Callum Anderson]

I confess I have not read the Conservative party’s full recommendations in this regard. The Government are clear that the Financial Ombudsman Service needs reform; it is not working for the sector, consumers or the UK’s international competitiveness. The Conservative party will put forward its recommendations, and the Government will make their considerations as part of the Financial Services and Markets Bill, which will be debated in the House of Commons Chamber in October. I recognise the downsides that the hon. Gentleman identified in his intervention, so I thank him for it.

The Minister already knows my views on retail capital. There is an excellent opportunity in the months ahead—certainly, in the run-up to the Budget in October—for the UK to establish a long-term retail investment strategy that is co-designed by industry, Government, civil society and regulators to be the best mechanism to realise the full potential of UK investors’ savings.

The second challenge that I want to turn to lies in how we manage artificial intelligence, which I became very familiar with when I was Parliamentary Private Secretary at the Department for Science, Innovation and Technology, and the broader digital revolution in financial services. Distributed ledger technology and tokenisation are having an ever-increasing influence on the international financial ecosystem. The UK should continue to act as a global leader and embrace that change now so that regulators, industry, investors and consumers alike can benefit from lower costs, widen access to capital, deliver a more efficient industry and enjoy the benefits of more productive investment.

At the same time, that requires us to fully build the infrastructure, regulatory framework and market confidence to allow innovators to scale safely and responsibly. I welcomed Chris Woolard’s first report as the UK’s wholesale digital markets champion. It marked an important step in delivering the Government’s wholesale financial markets digital strategy, but we now need to shift up a gear.

I would focus on two immediate priorities. First, the Government should publish a clear road map for DLT-enabled capital markets. UK financial markets—and global financial markets more broadly—need certainty about the sequence of reforms, the regulatory framework that the UK proposes to put forward and how new infrastructure will connect with the systems that are already in use by market participants. Second, we should use DIGIT—the digital gilt instrument—to build momentum across the market by setting a clear timetable for regular, benchmark-scale digital sovereign bond issuance so that we are properly mainstreaming UK Government debt in the financial market system.

On artificial intelligence, it is right that AI can transform productivity, investment management, fraud detection and customer service across the economy and society. But those opportunities also bring new and unfamiliar risks, from automated decision making that leads to unintended consequences to cyber-attacks by belligerent forces and operational disruption due to a greater dependence by industry on a small number of technology providers. With that in mind, I was proud to partner with Community trade union, which I should disclose that I am a member of, in May to launch its responsible AI charter for financial services; Zurich UK was its first signatory. The charter sets out practical principles for ensuring that AI is adopted responsibly, transparently and with people at the heart of its deployment. The Bank of England’s recent work makes it clear how quickly the risks that I just identified are growing. That is why we must maintain the urgent momentum on implementing the financial services AI adoption plan.

The third challenge facing the sector, which I want to address briefly, concerns the clean energy transition. I will not discuss the benefits or otherwise of which energy sources we may like to prioritise, but in my view, net zero cannot be delivered by public investment alone, however committed the Government are to that mission—and rightly so. Long-term, patient private capital also has a crucial role to play in supporting tomorrow’s energy infrastructure, from onshore and offshore wind and grid upgrades to next-generation nuclear power. In order for that capital to be committed effectively, I would welcome an annual published pipeline of investable clean energy projects so that firms and asset owners can plan and deploy investment at the scale and pace that our net zero commitments demand.

[Kerry McCarthy (Bristol East) (Lab)]

My hon. Friend will not be surprised to hear that I very much agree with the point that he just made. We have some excellent, innovative businesses in Bristol that came up through the Science Creates innovation hubs and attracted private capital. They are flourishing, but they need signals from the Government that we are sticking to our net zero agenda so that there will be a market for their products in due course. Does my hon. Friend agree that those signals are important?

[Callum Anderson]

I could not agree more with my hon. Friend. In this space and across many policy areas, what business and investors require and demand from us as policymakers—regardless of which party happens to be in power—is policy certainty. When we risk lurching in various directions, with various priorities and changing timelines, the only result is that investors withdraw or deploy their capital in other countries. Frankly, with regard to the clean energy transition, that will ensure that other countries, be they our competitors or our foes, will have a massive, global competitive advantage over us. I do not think it is a good idea for us to enable that.

Changing tack, the UK also faces the challenge of our constituents accessing affordable financial services and products. We need to honestly confront the barriers that still prevent too many of our constituents from opening a basic bank account, building even a very modest savings buffer for when times are hard, and accessing safe and affordable credit or securing the insurance that protects people from life’s shocks.