The OECD has revised down its growth forecasts for the UK, predicting an expansion of only 1.4% in 2025, down from 1.7%, and 1.2% in 2026, reduced from 1.3%. The adjustment adds pressure on the Chancellor as she prepares for the upcoming Spring Statement, amidst a £15bn financial gap. In response to the OECD’s interim Economic Outlook report, Rachel Reeves acknowledged “global headwinds” affecting the economy. The OECD also highlighted that “higher and broader increases in trade barriers would hit growth around the world and add to inflation.”

Writing in City AM, Chris Hayward, the policy chairman of the City of London Corporation, says the Chancellor should use her Spring Statement to prioritise pension reforms that boost investment in UK industries. An investment hub would streamline opportunities to grow inward investment, Haywood says, while digital verification solutions could add up to £4.8bn to the UK economy over the next five years, “transforming digital services and mitigating fraud losses.”

Rachel Reeves has committed to reducing bureaucratic hurdles in the UK, telling regulatory leaders during a meeting at Downing Street that there was too much regulatory overlap and too much bureaucracy. The Chancellor unveiled 60 measures Britain’s regulators have agreed to take in order to boost economic growth following Monday’s meeting. These included reducing environmental barriers to construction projects, trimming the legal duties of financial services regulators, Ofgem, Ofwat and the Office for Road and Rail and reviewing the role of the Financial Ombudsman Service. The Competition Markets Authority (CMA) will also be given a “growth-focused strategic steer” in the coming weeks and a package of reforms to modernise permitting for industry and energy sectors will be consulted on in June. Other measures include reviewing contactless payment limits, simplifying mortgage lender rules and helping start-ups to secure funding. Finally, writing in City AM, the PM Sir Keir Starmer says reshaping Britain’s regulatory landscape will “take years of discipline, focus and a willingness to make tough choices.”

The Treasury is reviewing the Financial Ombudsman Service to address concerns that it has been acting “as a quasi-regulator”. It aims to streamline dispute resolution and reduce regulatory burdens on businesses. Stephen Haddrill from the Finance and Leasing Association welcomed the review, highlighting the costly compliance burdens faced by firms. “The situation in the consumer credit sector is that firms spend millions of pounds complying with FCA rules, only to fall foul of the FOS’s reinterpretation of those rules,” he said. “Managing risk in this sector is expensive, time-consuming and subject to massive uncertainty, which claims management companies can then exploit, undermining the investability of the market.”

The tax office has significantly increased its investigations into underpaid capital gains tax (CGT), with cases rising from 4,564 to 14,223 in the 2023-24 tax year. According to UHY Hacker Young, £202.4m in unpaid tax was recovered, up from £180.8m the previous year. The tightening of CGT regulations, including cuts to the annual tax-free allowance from £12,300 to £6,000, has expanded the number of taxpayers affected. Brian Carey, tax partner at UHY Hacker Young, noted: “With Gen Z embracing non-traditional investments like crypto and meme stocks, HMRC is concerned it is missing out on a lot of unpaid CGT.” The tax office is also focusing on crypto investors, sending ‘nudge’ letters to those suspected of owing tax on their assets. An HMRC spokesman said: “Taxpayers are responsible for ensuring they have declared and paid the correct amount of CGT.”

Charlie Bean, former deputy governor of the Bank of England, has cautioned Chancellor Rachel Reeves against making hasty spending cuts in response to the Office for Budget Responsibility (OBR) forecasts, which he described as “pretty flaky.” Speaking at a Resolution Foundation event, Bean stated: “We’ve got ourselves into a frankly pretty ridiculous position where we’re doing fiscal fine-tuning to control the OBR forecast five years ahead.” He advised Reeves to consider extending the freeze on income tax thresholds rather than rushing into cuts. Gemma Tetlow, chief economist at the Institute for Government, echoed Bean’s sentiments, urging caution and suggesting that the Chancellor should focus on long-term strategies rather than immediate adjustments.

Aviva Investors has abandoned its plan to divest from carbon-intensive companies, shifting focus to broader sectors amid changing market conditions and energy security concerns.

Rachel Reeves, the Chancellor, is set to meet with fintech executives from companies like Stripe and Wise on Tuesday to discuss strategies for enhancing the UK’s economic competitiveness. This meeting, part of a series of roundtable events, aims to generate innovative ideas ahead of her spring statement. The agenda will focus on growth opportunities and challenges for fintechs over the next decade, following similar discussions with retail and investment banks.

According to Evident Insight’s Responsible AI Report, UK banks are significantly trailing their US and European counterparts in AI adoption. Alexandra Mousavizadeh, co-founder of Evident Insights, stressed the need for “stronger investment and a more cohesive AI strategy at a national level” to prevent UK banks from falling further behind.