Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what steps they are taking to implement and strengthen oversight of cryptoasset tax compliance, including measures to improve reporting, enforcement and consumer protection in the UK crypto market.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
HMRC uses a range of approaches to manage tax compliance, helping taxpayers get their tax right whilst tackling those who avoid or evade paying the taxes that are due.
Current and planned tax compliance measures are detailed below:
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the potential impact of tokenised deposits and smart contracts on the mortgage market, including use in conveyancing, remortgaging and the reduction of intermediaries and transaction delays.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
Decisions on the use of tokenised deposits and smart contracts in the mortgage market are independent commercial matters for lenders and property firms, within the regulatory framework overseen by the Financial Conduct Authority, including the Consumer Duty and relevant mortgage conduct rules. However, the Government is regularly in contact with mortgage lenders on all aspects of their business, including the evolution and integration of new technologies and their potential impact on the industry.
The Ministry of Housing, Communities and Local Government is currently undertaking a review of home buying and selling, which will consider how digital tools and emerging technologies could be used to improve property transaction processes. The Government has made clear its objectives that reform should support faster, more reliable transactions and reduced fall throughs and risks.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the implications for (1) consumer protection, and (2) financial stability, of emerging customer-facing trials of agentic AI systems in the UK banking sector.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The Government’s ambition is to make the UK a global leader in AI, leveraging our dual strength in financial services and AI to drive growth, productivity, and consumer benefits. Encouraging safe adoption is an essential part of realising that ambition.
The treatment of customers by UK banks and building societies is governed by the Financial Conduct Authority (FCA), whose independent regulatory powers ensure consumer protection in the financial services sector. The FCA’s Principles for Businesses require firms to provide prompt, efficient, and fair service to all their customers. The FCA’s Consumer Duty requires firms to act in good faith, prevent foreseeable harm, and act in the best interests of consumers.
UK banks are required to comply with relevant laws and regulations that are fundamental to consumer protection, including in any use of customer-facing agentic AI. In April 2024, the FCA published an update on its regulatory approach to AI, making it clear that where firms use AI as part of their business operations, they remain responsible for meeting FCA rules. Firms remain fully accountable for outcomes delivered by AI systems.
The Bank of England’s Financial Policy Committee (FPC) is responsible for identifying and monitoring risks to UK financial stability. In their April 2025 Financial Stability in Focus publication, they set out the potential benefits and risks to financial stability that could result from AI use in the financial system, including in relation to agentic AI. HM Treasury continues to work closely with the FPC and UK financial regulators to assess risks to financial stability.
The Government will continue to work with regulators and industry to ensure innovation proceeds safely and responsibly.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the implications for regulatory oversight of fintech innovation arising from developments in blockchain-based programmable deposit tokenisation in UK banks.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
New forms of digital money and payments present potential benefits for both users and providers of payment services, offering faster, cheaper payments with better functionalities and greater security.
The government, alongside regulators, is considering the innovation opportunities that blockchain-based payments instruments, including tokenised deposits, could present the UK financial services sector.
We are working with regulators and industry to design the next generation of retail payments infrastructure, overseen by the Payments Vision Delivery Committee.
Steps have already been taken to set up the right regulatory conditions for firms to safely innovate and experiment with this technology, specifically through the Bank of England and Financial Conduct Authority’s (FCA) work on the Digital Securities Sandbox.
Furthermore, the government recently laid legislation to regulate cryptoassets and stablecoins. This regime will raise standards, strengthen consumer protection, help tackle market abuse, and support the responsible growth of the UK’s cryptoasset sector by providing clear and consistent rules.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what steps they plan to take to implement the provisional licences authorisation scheme for financial services start-ups; and how they plan to ensure that the scheme balances provisional authorisation with consumer and market safeguards.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The government has committed to introducing a provisional licence authorisation regime for financial services firms seeking authorisation from the Financial Conduct Authority (FCA).
Introducing a provisional licence authorisation regime will require primary legislation, which the government will bring forward when Parliamentary time allows.
The regime will retain the high standards necessary to provide regulated financial services in the UK, and the FCA will operate the regime in line with its statutory objectives. Firms in the provisional licence authorisation regime will be subject to close supervision, and will be required to comply with relevant rules and requirements during the provisional licence period. The FCA will have its full suite of supervisory and enforcement powers in relation to these firms.
Further details can be found in the government’s recent policy update: https://www.gov.uk/government/publications/creating-a-provisional-licences-authorisation-regime-policy-update-2025
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what steps they are taking to support banks to overcome the barriers to the adoption of advanced fintech and artificial intelligence systems posed by outdated information technology infrastructure.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The government believes that the safe adoption of artificial intelligence (AI) by the financial services (FS) sector is a major strategic opportunity, with the potential to power growth across the UK. This includes banking which, as highlighted in the AI in Financial Services Survey led by the Financial Conduct Authority and the Bank of England, already benefits from AI innovations. Use cases mentioned include cyber security and fraud detection functions.
The government and the regulators are taking a pro-innovation stance to AI regulation across the economy including in financial services; and we are committed to continuing engagement with the sector and working with the regulators to monitor developments.
As part of the government’s Financial Services Growth and Competitiveness Strategy, the government will shortly be appointing a Financial Services AI Champion to act as a catalyst for AI adoption and innovation in the sector.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the participation of the UK's software and technology sectors in initial public offerings and the implications of this for the UK's fintech ecosystem.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The government has delivered an ambitious programme of reforms to make it easier for all firms, including fintechs, to list and raise capital on UK markets. This includes overhauling the Prospectus Regime and Listing Rules, providing more flexibility to firms and founders raising capital on UK markets.
At Mansion House, the Chancellor also announced the formation of a Listings Taskforce, to support businesses to list and grow in the UK, and the Financial Services Growth and Competitiveness Strategy, which sets out a comprehensive package of reforms to maintain the UK’s global leadership in Fintech. Officials and ministers regularly engage with industry leaders on sector developments.
The Government does not usually comment on specific movements in financial markets.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of recent trends in UK equity fund outflows and changes in investor asset allocation, and the implications for UK capital markets and investment.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The government has delivered an ambitious programme of reforms to make it easier for all firms, including fintechs, to list and raise capital on UK markets. This includes overhauling the Prospectus Regime and Listing Rules, providing more flexibility to firms and founders raising capital on UK markets.
At Mansion House, the Chancellor also announced the formation of a Listings Taskforce, to support businesses to list and grow in the UK, and the Financial Services Growth and Competitiveness Strategy, which sets out a comprehensive package of reforms to maintain the UK’s global leadership in Fintech. Officials and ministers regularly engage with industry leaders on sector developments.
The Government does not usually comment on specific movements in financial markets.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what steps they are taking to ensure that the adoption of agentic AI systems by banks is aligned with existing financial services consumer protections and regulatory standards.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The Government is working closely with industry and regulators to ensure that the adoption of Artificial Intelligence (AI) systems by banks is aligned with existing financial services consumer protections and regulatory standards.
The treatment of customers by UK banks and building societies is governed by the Financial Conduct Authority (FCA), the independent regulator of the UK’s financial services sector. The FCA’s Principles for Businesses require firms to deliver a prompt, efficient, and fair service to all customers. In addition, the FCA’s Consumer Duty requires firms to act in good faith, avoid foreseeable harm, and act in consumers’ best interests.
The use of AI, including agentic AI, does not absolve firms from their regulatory responsibilities or the need to comply with relevant laws and regulations.
In April 2024, the FCA published an update to its regulatory approach to AI, making clear that where firms use AI as part of their business operations, they remain responsible for ensuring compliance with FCA rules.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of recent economic analysis concerning the UK’s inflation outlook and associated risks to economic growth; and how this is being factored into fiscal and economic planning.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
Forecasting the UK economy, including the outlook for inflation and economic growth, is the responsibility of the independent Office for Budget Responsibility (OBR). The government set out how the economic outlook is factored into fiscal and economic planning it its autumn budget published on 26 November. Key points include:
- According to the OBR, inflation is past its peak and measures taken by the government will reduce inflation by 0.4 percentage points in 2026-27, including by lowering energy bills by around £150 from next April for the average household, and freezing regulated rail fares and prescription charges.
- The Chancellor has reaffirmed the Bank of England’s 2% Consumer Price Inflation (CPI) inflation target.
- While the Bank has overall responsibility for returning inflation to target, the government is also fully committed to tackling inflation. The most effective lever to achieve this is through responsible fiscal strategy.
- Stable prices give businesses the confidence to invest and supports the independent BoE Monetary Policy Committee (MPC), who have cut Bank Rate six times since the election.