Two more ALBs consolidated as Government ramps up regulatory overhaul

Following last week's landmark decision to abolish NHS England, the Government has signalled further significant consolidation among Arms-Length Bodies (ALBs), unveiling a radical new action plan today aimed at slashing regulatory red tape and streamlining government agencies.

Chancellor Rachel Reeves met senior regulator chiefs in Downing Street this morning to announce the action plan as part of the Government’s broader "Plan for Change," promising to cut administrative regulatory costs for businesses by 25% and significantly simplify legal duties across key regulatory bodies.

This development aligns with the Government's new strategic direction, exemplified by the controversial closure of NHS England, which Ministers argued duplicated roles already performed by the Department of Health and Social Care (DHSC), weakening direct ministerial accountability.

As part of today's announcement, regulators face dramatic reshaping or elimination. Already confirmed consolidations include the Payment Systems Regulator merging into the Financial Conduct Authority and the absorption of the Regulator for Community Interest Companies into Companies House.

The Treasury’s action plan specifically targets excessive complexity within environmental planning regulations, highlighting streamlined guidance on issues such as bat habitat protection - often cited as causing costly delays to infrastructure projects. A new system will introduce a single environmental regulator as the primary contact, eliminating the need for developers to secure approvals from multiple overlapping bodies.

Chancellor Reeves said: “By cutting red tape and creating a more effective system, we will boost investment, create jobs, and put more money into working people’s pockets.”

The Treasury has also set ambitious targets to review and simplify the core duties of key regulators such as Ofgem, Ofwat, and the Office for Road and Rail. Further, the Financial Ombudsman Service's role will be reviewed to prevent it acting as a quasi-regulator, restoring its focus on dispute resolution.

Ministers emphasise that these moves are about re-aligning regulators to become facilitators rather than obstacles to economic growth and innovation, in line with the Prime Minister's recent pledge to deliver a leaner, more agile state apparatus.

Today's announcement has received widespread backing from the business community. Rain Newton-Smith, CEO of the Confederation of British Industry (CBI), welcomed the shift towards a "proportionate, outcomes-based approach," and Federation of Small Businesses’ Craig Beaumont praised the potential for easing burdens on smaller enterprises.

With further consolidation of ALBs and streamlined regulatory mandates anticipated in the coming months, today's developments underline the Government’s clear intent to pursue deeper institutional reforms in pursuit of economic growth and simplified governance.