There is still hope that the Labour Government might launch a UK captive consultation at a later date, despite industry disappointment around its exclusion from today’s budget.
Chancellor Rachel Reeves revealed Labour’s first budget since the party was last in power in 2010, after its return to power in July’s general election.
There had been concern that headway made by the London Market Group (LMG) with the previous Conservative regime would be lost if the consultation, which had already been drafted and ready to go, did not proceed.
“Our conversations with Treasury have always talked about possible announcements at set piece events such as the budget or Mansion House,” said Caroline Wagstaff, CEO of the LMG.
“I remain hopeful that, since the Mansion House is more financial services’ focussed event, that it might give the government the opportunity to announce a consultation on captives.”
Wagstaff previously said that she felt the chances were now “better than lukewarm” that the consultation would go ahead.
Reeves is expected to make her Mansion House Speech on 14 November.
Chris Lay, CEO of Marsh McLennan UK, said the intermediary is disappointed that the consultation on a UK captive regime has not been launched as part of the latest budget.
“The UK is home to a world leading insurance market and could become an important home for captive insurers,” he said.
“At present, our current regulatory framework makes it hard for us to compete.
“Establishing a proportionate and competitive UK captive framework could deliver a major boost to the UK insurance market, demonstrating our innovation and signalling we are open for business,” Lay added.
In September 2023, a delegation of captive specialists met with the UK government’s previous City Minister, Andrew Griffith MP, at the Treasury to discuss the potential introduction of a captive regime.