By Steve Conley
Founder, Academy of Life Planning & Get SAFE
Transparency Task Force Advisory Group Member
When Britain’s regulators talk about “balancing” growth with consumer protection, they reveal that they’ve misunderstood the order of cause and effect.
It is trust that delivers growth — not the other way around.
No economy, no company, no nation can sustainably grow without trust. The idea that deregulation and competitiveness can somehow restore confidence is a dangerous illusion — and one we’ve seen play out before.
The Inversion of Purpose
At the FCA’s Annual Public Meeting this year, senior leaders defended their new growth and competitiveness objective. When challenged about the regulator’s trust deficit — that only a quarter of the public trust the FCA, and just a third trust financial firms — the response was telling:
“Growth that delivers well for consumers should improve trust.”
That sounds reasonable until you look closer.
Growth cannot deliver trust — because growth achieved without integrity only compounds suspicion. We’ve seen what “growth first” looks like: mis-sold pensions, systemic frauds, and regulatory capture. Every scandal erodes confidence, raises the cost of capital, and widens inequality.
The House of Lords Financial Regulation Committee makes the same mistake in reverse. Dominated by peers with vested interests in City institutions, it hauls the FCA in to demand “less interference” and “more competitiveness.” This is not scrutiny — it’s lobbying in robes. The result is a regulatory echo chamber where consumer protection is dismissed as red tape, and duty is subordinated to deal-making.
The Economics of Trust
Trust is not a moral luxury — it’s an economic input.
A high-trust economy enjoys a Structurally Trustworthy Premium (STP): lower borrowing costs, higher productivity, and stronger GDP.
A low-trust economy suffers a Structurally Untrustworthy Discount (SUD): higher risk premiums, weaker investment, and lower growth.
For the past five years, Britain’s weighted average cost of capital has risen from 5% to over 8%. That’s not only because interest rates went up; it’s because confidence went down. Investors now price in uncertainty, opacity, and conflict of interest. Every time Parliament privileges profit over principle, markets quietly add another percentage point of doubt.
Trust lowers the cost of money.
Distrust inflates it.
It’s that simple.
A System Built Backwards
The FCA’s 2030 Strategy claims that its three objectives — consumer protection, integrity, and competitiveness — are “mutually reinforcing.”
In theory, perhaps.
In practice, they’re being pursued in the wrong order.
Consumer protection isn’t a handbrake on growth; it’s the engine of it.
Integrity isn’t a regulatory burden; it’s a market advantage.
Transparency doesn’t stifle innovation; it multiplies it.
A regulator that treats trust as an afterthought is like a builder who removes the foundations to save time on the roof. The structure might rise faster — but it won’t stand for long.
What We Need Instead
The remedy is not new. It’s ancient. It’s the principle that trust precedes trade.
To rebuild fiscal strength and economic legitimacy, Britain must:
- Legislate fiduciary duty across all financial intermediation — from product design to advice.
- Embed transparency by design into every regulatory process, digital system, and AI standard.
- Reform redress architecture so it serves citizens over funders.
- Quantify the trust economy — measuring how integrity impacts growth, productivity, and borrowing costs.
These are not idealistic reforms. They are structural necessities.
The Path Forward
If Britain truly wants to grow, it must start by restoring faith — not in markets, but in fairness.
Every recovery in history has begun not with speculation but with integrity. Every flourishing economy has stood not on capital alone, but on confidence that rules are real, duties are honoured, and wrongs are righted.
Growth without trust is extraction.
Trust without growth is aspiration.
But trust that delivers growth — that’s prosperity with purpose.
Oversight without independence is theatre, not accountability.
When those tasked with scrutinising the regulator are themselves financially entangled with the institutions they oversee, what we witness is not governance but choreography. Every question becomes a performance; every report, a press release for vested interests.
The House of Lords Financial Regulation Committee, dominated by former City executives and current shareholders, now functions less as a guardian of public interest and more as a lobbying arm of the financial establishment. It wields the authority of Parliament while serving the priorities of profit. That’s not scrutiny — that’s capture.
And capture is the root cause of Britain’s Structurally Untrustworthy Discount (SUD).
When accountability mechanisms are compromised, risk premiums rise, markets falter, and citizens lose faith. Investors respond rationally — by demanding higher returns to offset the perceived corruption of process. The result is slower growth, higher borrowing costs, and another quiet erosion of the nation’s moral and fiscal capital.
True oversight demands distance.
It must be structurally independent, financially disinterested, and transparent by design. Committees should include victims of misconduct, consumer advocates, ethicists, and independent experts — not those with current or recent directorships in the very firms under review.
Until that separation is restored, the system will continue to police itself with one hand while extracting with the other.
This is why movements like the Transparency Task Force — and initiatives such as Get SAFE — are so vital. They represent the counter-balance: citizens and professionals creating independent structures of truth, evidence, and redress. They prove that the public can, and must, build its own mechanisms of integrity when official ones have been co-opted.
Britain’s real governance deficit is not technical but ethical. The absence of independence in oversight has created a feedback loop of distrust, where regulators answer to lobbyists instead of the law, and consumers pay the price in every transaction.
If Parliament wishes to rebuild legitimacy, it must start here — by dismantling the illusion of impartiality and legislating for genuine independence in financial oversight.
Until then, transparency will remain performative, trust will remain discounted, and the economy will continue to pay interest on its own moral debt.
The FCA Annual Public Meeting 2025
The FCA Annual Public Meeting 2025 transcript is a remarkable record of the regulator being questioned directly by victims, journalists, and transparency campaigners on its trust deficit, consumer protection failures, and growth agenda.
Key takeaways relevant to our earlier comment about the Lords Committee and the FCA’s priorities:
- Nikhil Rathi and Ashley Alder both repeatedly framed the FCA’s new 2030 strategy as balancing consumer protection with growth and competitiveness.
- Mark Bishop’s opening question (Transparency Task Force) challenged this very framing — asking how the FCA could hope to achieve its growth objective when only 27% of the public trust the FCA, and only 36% trust financial firms.
- Sarah Pritchard’s reply positioned growth and consumer protection as “mutually reinforcing,” arguing that “growth that delivers well for consumers should improve trust.”
- The tone of multiple exchanges — from Paul Carlier on motor finance, Wayne Johncock and Barrie Smith on fraud, to Andy Agathangelou on governance — exposed a deep gulf between the FCA’s self-assessment and public confidence.
- Alder and Rathi emphasised “we cannot pursue every concern,” reinforcing the FCA’s risk-based triage approach — which many victims interpreted as abdication of duty.
In short: the transcript evidences the systemic conflict between the FCA’s new “growth and competitiveness” objective (a post-Brexit addition) and its statutory consumer protection duty. Your framing — “Surely an oversight committee should be asking the FCA about its primary objective, not its secondary” — is directly validated by this exchange.
“Trust Precedes Trade“
Trust is widely recognised as a fundamental prerequisite for trade, both historically and in contemporary economic systems. As economists and sociologists alike have shown, the phrase “trust precedes trade” encapsulates a foundational truth: for any exchange to occur, the parties involved must possess a baseline confidence that agreements will be honoured.
1. Risk Reduction
Trade inherently involves uncertainty. Sellers must trust that buyers will pay; buyers must trust that sellers will deliver what was promised. In the absence of trust, the perceived risk of opportunism rises, and markets fail to function efficiently.
- As the economist Kenneth Arrow famously noted, “Virtually every commercial transaction has within itself an element of trust.” (Arrow, 1972, The Limits of Organization).
- Empirical studies confirm that higher social trust correlates with greater participation in markets and higher levels of economic exchange (Zak & Knack, 2001, The Economic Journal).
2. Enforcement of Contracts
In modern economies, institutional trust—in courts, regulators, and enforcement mechanisms—acts as the “third-party guarantor” of trade. Where such institutions are weak or perceived as captured, individuals and firms are reluctant to transact.
- Research by Knack and Keefer (1997, Quarterly Journal of Economics) found that trust and civic norms substantially predict cross-country investment and trade patterns, particularly where legal enforcement is unreliable.
- In the UK context, weakening trust in regulatory independence (e.g., conflicts within oversight committees) directly raises perceived transaction risk and the economy’s cost of capital.
3. Complexity of Modern Commerce
As trade networks evolve—through long-term contracts, digital supply chains, and cross-border flows—the demand for mutual trust increases exponentially. Each layer of intermediation introduces new asymmetries of information and opportunity for exploitation.
- De Sousa, Lochard & Silve (2023, CEPR) show that higher-trust regions specialise in more complex, high-value industries. Complexity thrives on reliability.
- Similarly, Nguyen & Bernauer (2014, WTI) find that individuals with higher interpersonal trust express stronger support for open trade and global integration.
4. Efficiency and Cost Reduction
Trust also enhances efficiency. In high-trust environments, less time and money are spent on monitoring, litigation, or defensive contracting.
- As Nobel laureate Oliver Williamson’s transaction cost economics highlights, trust reduces the need for costly safeguards (Williamson, 1985, The Economic Institutions of Capitalism).
- A PwC (2022) cross-country study found that over 50% of the variation in GDP per capita could be explained by differences in social trust levels (PwC, The Value of Trust to the Economy).
In Essence
Trust lowers the transaction costs of doing business and unlocks trade’s productive potential.
A society that cultivates trust—both interpersonal and institutional—enables commerce to flow freely, investment to expand, and prosperity to compound.
Where trust is absent, trade contracts, costs rise, and growth stalls.
As centuries of commerce and countless studies affirm:
Trust is not the by-product of trade — it is its precondition.
Join us at the Academy of Life Planning.
Let’s raise capability and integrity — together.
Because only when products and services are structurally trustworthy can consumers truly be free.
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