Shadow Chancellor Mel Stride has launched a stinging critique of the Financial Conduct Authority (FCA), expressing surprise at its refusal to investigate potential market manipulation by the Treasury ahead of the recent Budget. He warned that failing to act risks setting a dangerous precedent where governments can leak sensitive information without facing any consequences.
FCA Declines to Launch Formal Probe
The political row escalated on Thursday 4 December 2025, when FCA chair Nikhil Rathi confirmed in a letter that the regulator had "not commenced an enforcement investigation" into the Treasury. This letter was addressed to Treasury Select Committee chair Meg Hillier, following calls for an inquiry from Stride and SNP parliamentary leader Stephen Flynn.
Rathi stated that government communications surrounding the Budget were a "matter for parliament through its accountability mechanisms." This stance followed his comments from Wednesday, where he noted the FCA had a "specific remit" for such investigations. The FCA chair also pointed to an announcement by James Murray, the Chief Secretary to the Treasury, that the government would conduct its own internal inquiry into the Budget leaks.
Stride's Strong Reaction and Warning
In a sharp response, Mel Stride said he was "surprised" the FCA had not yet initiated its own investigation, "given the clear evidence that leaks of market sensitive information occurred." He emphasised the gravity of the situation, stating: "We cannot allow a precedent where governments leak or misuse confidential, market-sensitive information without consequence."
Stride outlined his next steps, noting that as the FCA plans to await the Treasury's internal findings, he will be writing to Treasury Permanent Secretary James Bowler. His letter will seek clarification on the nature and scope of the Treasury's leak inquiry. Stride also pledged to follow up directly with the FCA with further questions about their approach to the matter.
The Backdrop: 'The Leaky War' and OBR Concerns
This exchange is the latest development in a controversy dubbed 'The Leaky War'. It stems from criticism by civil servants at the Office for Budget Responsibility (OBR) regarding frenzied Budget briefings from anonymous government sources.
OBR's David Miles highlighted that media briefings suggesting improved forecasts—which emerged as investors reacted badly to news of the government reneging on income tax rise plans—were "damaging" to the organisation. Stride has also written to Bowler to ask if he shares the OBR's concerns and what action is being taken against officials.
Opposition MPs have additionally targeted Chancellor Rachel Reeves for her "scene setter" press conference on 4 November, where she appeared to lay the groundwork for breaching Labour manifesto commitments. However, Miles clarified that her public comments were not misleading.
