The UK Government’s Strategic Steer to the CMA: Resetting the priorities (Part 1)

Today, the UK government issued its draft strategic steer to the Competition & Markets Authority (CMA) for consultation.

Why does the strategic steer matter?

The CMA is an independent authority but remains ultimately accountable to Parliament. In keeping with this position, it has long been settled practice that the UK Government (and devolved administrations) should – while steering clear of becoming involved in specific cases – be able to “feed into and inform” the CMA’s work. This is mainly achieved through the government’s non-binding steer, which the CMA takes into account in setting its strategy and priorities.

Typically, the strategic steer is a “plain vanilla” restatement of the government’s expectations around how the CMA should approach its work. The latest strategic steer, however, is more significant, being the first opportunity for the government to set out its expectations of the CMA following recent dissatisfaction with its approach and the removal of Marcus Bokkerink as its Chair (discussed on our latest Essential Antitrust podcast episode).

What does the strategic steer say?

Since the Labour Party came into power in July 2024, it has strongly emphasised the need to promote UK economic growth and investment. While the CMA had sought to reassure the government of its alignment with these objectives, the removal of the CMA Chair has sent a clear signal (both to the CMA and to other UK regulators) that more is needed.  As the Secretary of State for Business and Trade, Jonathan Reynolds, has put it, it is clear that the government wants to see “regulators including the CMA supercharging the economy with pro-business decisions that will drive prosperity and growth”.

Against this background, the strategic steer reiterates the government’s “primary mission” of economic growth. Specifically, it directs the CMA to deliver on this agenda by: 

• using its tools proportionately: including by giving appropriate consideration to interventions, harms, markets and sectors that drive growth and investment, and to “ensure growth and innovation benefits are prioritised”;
• ensuring parallel action is timely, coherent and avoids duplication: making clear that the CMA should think carefully about work being undertaken on the same issues by competition and consumer protection authorities in other jurisdictions. That consideration will be especially important to the CMA’s enforcement of the UK’s new digital markets regime – a regime that has come into force after the enactment of the EU’s Digital Markets Act but which is expected to impact many of the same products and services. The government has been clear that the CMA should use the new digital markets regime “flexibly, proportionately and collaboratively” and to “take particular care to ensure growth and innovation benefits are prioritised, including through supporting the government in delivery of  the AI Opportunities Action Plan”; and
• minimising unpredictability and uncertainty: emphasising the importance of the CMA providing “proactive, transparent, timely, predictable and responsive engagement with businesses to enable them, in turn, to engage quickly and effectively with the CMA”. Suggestions for doing so include a review of the CMA’s procedural guidance (to make it “accessible and meaningful to business”), and for the CMA to continue to develop its evidence base for demonstrating its impact on the UK economy. It is also asked that the CMA “focus on collaborative approaches to resolving issues” and in carrying out their work, for the CMA to be “attuned, and responsive to, feedback from business”.

The steer also highlights the need for engagement with the government on key policy issues. Importantly, it stresses a focus on accountability, and the government’s expectation for the CMA to demonstrate clearly and quickly how it will account for, and report on, the government’s steer in its work – including in its annual report and by updating the CMA’s framework agreement to include relevant reporting requirements.  

What impact is this likely to have on the CMA’s approach?

The strategic steer does not change the fact that the CMA remains in the driving seat for the enforcement of competition and consumer law in the UK. There is no suggestion that the government will become directly involved in individual cases, that there will be any weakening of the UK’s merger control or antitrust regimes, or of the CMA being told to “look the other way” simply where businesses promise to invest in the UK.  In particular, the steer appears to suggest that the CMA should continue with its intention to make full use of its new consumer enforcement powers (on the basis that “promoting consumer trust and confidence” can also help to grow the economy).

However, the steer’s focus on growth – as the “overriding national priority of this government” – does mark a clear change in direction, compared to the previous steer’s emphasis on a broader range of objectives (including addressing cost of living challenges). There is also a marked shift from the previous steer’s call for the CMA to act as a thought leader at home and abroad, to shape the international debate and the response on key cross-border issues, and to be a strong independent voice on global competition and consumer issues, with the latest steer making a clear call for this approach to be dialled back. The new steer highlights the need for the CMA to adopt a proportionate, globally coherent and collaborative approach, and for that approach to be backed up by “published results regarding CMA decision-making, commercial awareness, transparency and stakeholder engagement”. 

Will we see a change in the sectors most acutely in focus?

The CMA can be expected to continue to look closely at business activities impacting the UK’s innovation and security. The steer directs the CMA to support the promotion of the growth strategy set out in the government’s Industrial Strategy and its key eight sectors, namely: advanced manufacturing, clean energy industries, creative industries, defence, digital and technologies, financial services, life sciences, and professional and business services.  The steer also calls for greater efficiencies and improvements in the delivery of key public services, suggesting that alongside the energy and healthcare sectors, any businesses perceived to be acting as “logjams” within the supply chain in, for example, the education, transport, and water sectors could also attract attention.

The strategic steer also provides further impetus for the CMA’s ongoing reshaping of its merger control regime (with the CMA immediately taking up this challenge by announcing a range of reforms).  What this is likely to mean in practice is discussed in our separate blog post on what the strategic steer may mean for UK merger control.

If you would like to discuss these issues in more detail or respond to (or stay updated on) the consultations on the draft strategic steer, please speak to your usual Freshfields contact. To read more about our thoughts on the key global competition law trends to be aware of in the coming year, you can request access to our Navigating antitrust in 2025: 10 key themes publication.