Written questions by Garnier.

Whether her Department has a planned timeline for the implementation of digital gilts; and when she expects to lay legislation before the House.

On 18 March 2025, the Chancellor of the Exchequer launched the procurement process for the pilot Digital Gilt Instrument (DIGIT) issuance. Following the announcement, HMT and UK Debt Management Office published the first step in the process, which seeks views from industry to inform the development and delivery of the pilot DIGIT issuance. HMT issued a Preliminary Market Engagement Notice through the contract finder service. These publications provide further information on the scope of the pilot and seek views from potential suppliers and the financial services sector, to inform the development and delivery of DIGIT. This includes information on the current landscape of services available or in development in the UK and what potential investors want to see from a DIGIT issuance. The market engagement exercise is the first step in our process. A formal tendering process is expected to be launched in late Spring 2025, with DLT suppliers being appointed by late Summer 2025. The government bought forward secondary legislation at the end of the last year that will enable changes to be made to existing regulations relevant to issuing Government debt within the Digital Securities Sandbox (DSS). The current regulations may be unsuitable for a digital issuance and need to be temporarily modified to enable an issuance. Our market engagement is also intended to assist with understanding what elements of these laws need to be changed. Any necessary amendments will require HMT to lay a Statutory Instrument.

What recent progress her Department has made on the development of digital gilts; and what assessment she has made on their potential impact on the UK financial system.

On 18 March 2025, the Chancellor of the Exchequer launched the procurement process for the pilot Digital Gilt Instrument (DIGIT) issuance. Following the announcement, HMT and UK Debt Management Office published the first step in the process, which seeks views from industry to inform the development and delivery of the pilot DIGIT issuance. HMT issued a Preliminary Market Engagement Notice through the contract finder service. These publications provide further information on the scope of the pilot and seek views from potential suppliers and the financial services sector, to inform the development and delivery of DIGIT. This includes information on the current landscape of services available or in development in the UK and what potential investors want to see from a DIGIT issuance. The market engagement exercise is the first step in our process. A formal tendering process is expected to be launched in late Spring 2025, with DLT suppliers being appointed by late Summer 2025. The government bought forward secondary legislation at the end of the last year that will enable changes to be made to existing regulations relevant to issuing Government debt within the Digital Securities Sandbox (DSS). The current regulations may be unsuitable for a digital issuance and need to be temporarily modified to enable an issuance. Our market engagement is also intended to assist with understanding what elements of these laws need to be changed. Any necessary amendments will require HMT to lay a Statutory Instrument.

What the (a) scope and (b) remit is of the Treasury review into Financial Ombudsman Service.

The Treasury will examine whether the Financial Ombudsman Service (FOS), is delivering its role as a simple, impartial dispute resolution service which quickly and effectively deals with complaints against financial services firms, and which works in concert with our Financial Conduct Authority which regulates the sector. The review will focus, in particular, on a range of points that have been raised through the recent Call for Evidence on the Growth and Competitiveness Strategy. This will include addressing concerns around: The framework in which the FOS operates which has led to it acting, at times, as a quasi-regulator;Whether the FOS is applying today’s standards to actions that have taken place in the past; andThe practices that have grown up over time on compensation. The review builds on the announcements the Chancellor made at Mansion House, as well as modernising the FCA’s rules for dispute resolution. As part of the review, the government will consider whether any legislative changes are necessary to ensure that we have a dispute resolution system in the UK which is fit for a modern economy.

What recent discussions she has had with the Bank of England on the Financial Services Compensation Scheme's compensation limit for (a) consumer and (b) business accounts.

Eligible deposits held by UK banks, building societies and credit unions that are authorised by the Prudential Regulation Authority (PRA) are protected by the Financial Services Compensation Scheme up to £85,000, with joint accounts protected up to £170,000. This limit is set by the PRA and applies to both retail and business accounts. The PRA is required to independently review the limit every five years and will be publishing a consultation on the outcome of its most recent review shortly. Any changes to the limit must be approved by the Treasury and the Government would carefully consider any changes proposed by the PRA.

What estimate her Department has made of the cost of merging the Financial Conduct Authority and the Payment Systems Regulator.

The Payment Systems Regulator (PSR) has carried out important work to support the UK’s world leading payments sector. However, moving forward, the Government wishes to see a more streamlined regulatory environment with minimal overlap between regulators’ responsibilities. That is why the Government has announced its intentions to consolidate the PSR and its functions primarily within the Financial Conduct Authority (FCA). The Government will consult on the detail of this proposal in the summer and legislate as soon as possible. The Payment Systems Regulator is funded by fees levied on industry.

What assessment her Department has made of the potential impact of merging the Financial Conduct Authority and the Payment Systems Regulator on costs to the Exchequer.

The Payment Systems Regulator (PSR) has carried out important work to support the UK’s world leading payments sector. However, moving forward, the Government wishes to see a more streamlined regulatory environment with minimal overlap between regulators’ responsibilities. That is why the Government has announced its intentions to consolidate the PSR and its functions primarily within the Financial Conduct Authority (FCA). The Government will consult on the detail of this proposal in the summer and legislate as soon as possible. The Payment Systems Regulator is funded by fees levied on industry.

Whether her Department plans to require (a) technology and (b) telecommunication firms to contribute to the cost of (i) fraud prevention and (ii) the reimbursement of victims of fraud on their platforms.

Fraud is a costly crime for citizens, consumers, and businesses.I welcome existing pledges to prevent fraud made by tech and telecoms firms.At Mansion House, the Chancellor announced this government would work with tech and telecoms companies to stop their platforms and networks being exploited by criminals.We are monitoring progress, including work on the second Telecommunications Fraud Sector Charter and implementation of the Online Safety Act.To balance the requirement on Financial Services to reimburse victims of fraud, Section 72 of the Financial Services and Markets Act enables the sector to manage risk through due diligence checks before releasing payments.The department will continue to work with the Home Office and Department for Science, Innovation and Technology to unlock further prevention efforts across all sectors in the forthcoming update to the fraud strategy.

If she will make an estimate of the potential impact of (a) reducing the cash ISA limit to £4,000 and (b) creating incentives to put money into stocks and shares ISAs on the amount of money that will be put into stocks and shares ISAs in each of the next three years.

The Government is committed to incentivising greater saving and investment. Individual Savings Accounts (ISAs) help people save for their future goals and build greater financial resilience. The Government recognises the important role that cash savings play in helping households build a financial buffer for a rainy day. The Government also wants to see more consumers participate in capital markets and benefit from the long-term financial security and returns that investing can provide. The Government continues to keep all aspects of savings policy under review.

What discussions she has had with the Bank of England on increasing the proposed eligibility threshold in its consultation on minimum requirement for own funds and eligible liabilities (MREL) to £50bn.

The Government is continuing to engage closely with the Bank of England on its recent consultation on its approach to setting a minimum requirement for own funds and eligible liabilities (MREL), which closed on 24 January. The Bank of England sets MREL policy, including the thresholds for MREL, independently in its capacity as resolution authority. The Government recognises the varied feedback raised by industry, including on the asset-based threshold. The Government’s engagement with the Bank of England has included and will continue to include consideration of this feedback as well as the impacts on economic growth.

Whether her Department has made an assessment of the potential impact of removing stamp duty from UK listed equity transactions on economic growth.

Collectively, Stamp Duty and Stamp Duty Reserve Tax are currently forecast to raise up to £5bn per year, providing vital revenue which helps to fund key public services. The existing framework contains multiple reliefs and exemptions which are designed to boost liquidity and growth. The government keeps all taxes under review.

How much money has been raised from stamp duty charged to UK listed equity transactions in each financial year since 2010.

HM Revenue and Customs does not hold the necessary information on its statistical data systems to separate transactions of UK listed equity and the resulting Stamp Tax on Shares charge from other sources of Stamp Tax on Shares revenue. However, the majority of Stamp Duty Reserve Tax (SDRT) receipts likely relate to UK listed equity transactions. A timeseries of SDRT receipts is included in Table 1 of the UK Stamp Tax statistics publication available here: https://www.gov.uk/government/statistics/uk-stamp-tax-statistics

When her Department plans to lay the Statutory Instrument for the introduction of the PISCES Sandbox.

As the Chancellor announced at Mansion House in November 2024, the government intends to lay the statutory instrument which will provide the legal framework for the PISCES Sandbox before Parliament by May 2025.

To ask the Chancellor of the Exchequer what assessment she has made of the adequacy of the Financial Conduct Authority’s decision to automatically delete emails after 12 months.

The FCA is operationally independent of government and therefore the Treasury has not made an assessment of this decision. The government expects the FCA to act in accordance with high standards of transparency and operational efficiency, and will continue to hold the FCA to account for how it exercises its functions.

What assessment she has made of the adequacy of the Financial Ombudsman Service’s decision to introduce a £250 charge for claims management companies to refer cases.

The Government recognises that many professional representatives, including claims management companies, provide a valuable service to consumers by supporting them to make financial services redress claims. However, there are examples of poor behaviour from some professional representatives, and the Government considers that introducing a fee for professional representatives when they bring cases to the Financial Ombudsman Service (FOS) will help to ensure that the FOS can focus on promptly resolving consumer complaints and reduce the impact of spurious complaints on financial services firms. On 25 November 2024, Parliament approved a Statutory Instrument which allows the FOS to charge fees to professional representatives. The FOS is responsible for determining exactly who it charges and the level of any fees, and following extensive consultation, it has confirmed its intention to charge professional representatives from 1 April 2025.

What steps she is taking to ensure the (a) transparency and (b) accountability of the Financial Ombudsman Service.

The Financial Ombudsman Service (FOS) is governed by the framework set out in the Financial Services and Markets Act (FSMA) 2000. This includes a range of mechanisms to ensure the accountability and transparency of the FOS.The Financial Conduct Authority (FCA) is responsible for ensuring that the FOS is, at all times, capable of exercising its statutory functions.To support transparency and accountability, the FOS is required to lay its annual report and accounts before Parliament, and is subject to statutory audit by the National Audit Office.Representatives of the FOS may also be called to appear before Parliamentary committees, including the Treasury Select Committee, which most recently occurred earlier this month.HM Treasury meets regularly with both the FOS and the FCA to discuss relevant issues and performance against their statutory functions. This includes work to deliver the package of reforms announced by the Chancellor at Mansion House in November 2024, to modernise the framework under which the FOS operates and give clearer expectations to consumers and firms.

What assessment she has made of the adequacy of the recommendations within the House of Lords Financial Services Regulation Committee's report entitled Naming and shaming: how not to regulate, published on 6 February 2025.

The Government welcomes the publication of this report and its recommendations for the Financial Conduct Authority (FCA). Effective Parliamentary scrutiny is key to ensuring a well-functioning regulatory environment with high standards of accountability and transparency. The Government will continue to engage the FCA as it considers the responses received to its most recent consultation on these proposals and the Committee’s report, and expects the FCA to ensure that any proposals it takes forward are effective, proportionate, and contribute to a competitive regulatory environment in the UK.

If she will make an assessment of the potential merits of taking legislative steps to allow credit unions to access the Bank of England’s liquidity facilities.

Credit unions are not currently eligible to access the Bank of England’s liquidity facilities, but the Bank continually assesses the types of firms that are eligible. The Government has made clear its strong support for the credit union sector, recognising the value that credit unions bring to their members in local communities across the country in providing savings products and affordable credit. The Government continues to engage regularly with this sector to understand the current barriers they face and to consider further opportunities for growth.

What assessment she has made of the adequacy of the Bank of England's Financial Policy Committee's 15% cap on mortgage lending.

The flow limit, which limits the number of mortgages extended at loan-to-income (LTI) ratios of 4.5 or higher to 15% of a lender’s new mortgage lending, is set by the independent Financial Policy Committee (FPC) of the Bank of England.While the Government does not seek to intervene in decisions made by the independent FPC, the Chancellor has recommended that the Committee consider how its decisions support the Government’s priority of supporting home ownership, as stated in her remit letter sent to the FPC on 14 November 2024.

If she will make an estimate of the number of additional mortgages that could be approved by increasing the 15% cap on bank mortgage lending above 4.5 times income to (a) 17.5%, (b) 20% or (c) removing the cap entirely.

The flow limit, which limits the number of mortgages extended at loan-to-income (LTI) ratios of 4.5 or higher to 15% of a lender’s new mortgage lending, is set by the independent Financial Policy Committee (FPC) of the Bank of England.While the Government does not seek to intervene in decisions made by the independent FPC, the Chancellor has recommended that the Committee consider how its decisions support the Government’s priority of supporting home ownership, as stated in her remit letter sent to the FPC on 14 November 2024.

What discussions she has had with the Bank of England on creating a regulatory framework for stablecoins.

HM Treasury has ongoing engagement with the financial regulators, including the Bank of England, on the regulatory treatment of cryptoassets. The Government plans to publish draft legislation for the creation of a financial services regulatory regime for cryptoassets as early as possible this year. This regime will include creating a new regulated activity for stablecoin issuance.