Ministers Reject 13 Investment Reforms, BIST Committee Warns

Ministers have rejected 13 of 47 recommendations from a year-long parliamentary inquiry into mobilising capital for British businesses, the Business, Innovation, Science and Trade Committee said on 21 October 2026. The Government partially accepted 18 more and fully accepted just 16 — a tally the Committee says falls short of the coordinated reform needed to match Britain's international competitors.

The rejected proposals include a review to identify a second wave of stock market reforms to boost the London Stock Exchange, changes to share stamp duty and dividend tax relief, a ten-year ambition to triple venture capital assets, and consolidation of public finance institutions to boost their firepower.

The Committee did welcome two commitments: expanded lending guarantees and support for angel investor roadshows. But it argues the overall response lacks the scale required.

What does this change for investors and UK firms?

For now, very little — and that's the Committee's core complaint. The original report, Investing in the UK economy, drew on 60 written submissions and 37 witnesses. It laid out a programme to rejuvenate the London Stock Exchange, expand venture capital, strengthen angel networks, rebuild regional banking and transform the capacity of the UK's public finance institutions.

Committee Chair Rt Hon Liam Byrne MP pulled no punches in his assessment: "Britain needs an investment revolution. Our ambition should be to lift UK investment to the highest rate in the G7."

Byrne framed the problem as institutional, not financial. "With over £3 trillion in long term savings, the UK is not short of capital. And as one of the world's great science powers, we are not short of enterprise and ideas," he said. "But we simply do not have institutions with enough firepower to match capital to ideas on the scale British firms need. So time after time we're losing high potential new firms - and high paying new jobs - to American investors."

That £3 trillion figure is worth pausing on. It's roughly the size of the entire French economy sitting in UK long-term savings pots — capital the Committee believes should be flowing into domestic businesses and infrastructure rather than leaking abroad.

'Today's response falls short'

Byrne said the inquiry's roadmap covered "the waterfront of British finance" and accused ministers of complacency in their replies. "Too often, proposals for the next stage of reform are met with a defence of what is already being done," he said. "I fear ministers have yet to grip the scale of reform needed."

He set out the Committee's shopping list plainly: "We need to rejuvenate the London Stock Exchange, dramatically expand our venture capital system, build up angel investor networks in every region and rebuild a regional banking network to match the best-in-class systems on the Continent."

Regional banking is a specific flashpoint. Byrne wants business banking restored to high streets after what he called "the radical centralisation of banking decisions in London." He also pointed to the United States, Germany and South Korea as models for the scale, ambition and coordination the UK's public finance institutions currently lack.

The stakes rise with the Budget, due next week. "The Budget next week is an opportunity for ministers to show they share the ambition set out in our report," Byrne said, adding that mobilising long-term savings is "key to backing our winners and boosting growth in every postcode."

A new inquiry opens on entrepreneurship

The report was launched with Dame Julia Hoggett, Chief Executive of the London Stock Exchange, at the exchange's market opening ceremony, alongside banks, investors, pension funds, lawmakers and academics. The Committee will now invite stakeholders to assess the Government's response and identify further action needed.

It has also opened a fresh inquiry into entrepreneurship in the UK, examining what it takes to turn an idea into a living and a living into a job-creating business. Evidence is open to sole traders, market and eBay traders, tradespeople, side-hustle operators, employers and anyone who has faced barriers to starting a business.

Written evidence closes on Thursday 12 November 2026. With the Budget days away, the practical question for practitioners is whether the Treasury answers the Committee's call — or whether another round of reform proposals meets another round of "defence of what is already being done."