Lucy Rigby Takes Charge of City Finance Amid Rising Class Actions

Lucy Rigby has been appointed as the new Economic Secretary to the Treasury, stepping into the role previously held by Emma Reynolds. This change comes as part of a cabinet reshuffle on March 15, 2024, amidst increasing scrutiny of Labour’s approach to balancing consumer rights and business interests in the City of London.

Rigby, a relatively new face in politics, previously served as Solicitor General before her recent promotion. She secured her position as the Member of Parliament for Northampton North in the 2024 elections, garnering nearly 44 percent of the vote. Her rapid ascent in Labour’s ranks has caught the attention of political analysts, with some noting her rise as “faster than most” in recent history.

Despite her legal background, critics argue that Rigby, like many of her Labour colleagues, lacks substantial business experience. However, her time as a partner at a City law firm equips her with a nuanced understanding of economic operations. Rigby’s professional journey includes significant roles, such as working at the magic circle firm Slaughter and May for over four years, and later as a competition lawyer at the Office of Fair Trading, now known as the Competition and Markets Authority.

Class Actions on the Rise

As Rigby settles into her new role, the legal landscape is shifting, particularly concerning class actions in the UK. These collective actions, which have gained momentum since legislation introduced in 2015, have seen the total value of cases surpass €155 billion (£135 billion) in 2024. Rigby played a pivotal role in high-profile cases during her tenure at Hausfeld, including a £480 million collective consumer claim against Qualcomm on behalf of Which?.

The growing prevalence of class actions has raised concerns among businesses that face escalating legal fees and lengthy proceedings. According to a report from the Adam Smith Institute, this trend threatens to erode trust in the business community and complicates the legal environment. The Department for Business and Trade recently opened a call for evidence to assess the impact of opt-out collective actions, highlighting the significant financial implications for companies involved.

Rigby’s position may provide an influential ally for claimant firms, particularly as Labour’s agenda pushes for reforms that could expand collective bargaining rights and potentially pave the way for more US-style class actions in the UK.

Focus on Financial Growth

Despite these challenges, Rigby has made it clear that her focus will be on fostering investment and innovation in the financial sector. She aims to reinforce the UK’s status as a global financial services hub, emphasizing the importance of developing a growth and competitiveness strategy that enhances economic resilience and creates skilled jobs.

In her initial days, Rigby prioritized meetings with key figures, including Paul Atkins, the chairman of the US Securities and Exchange Commission, and leaders from major lending institutions. These discussions are aimed at encouraging innovation in the mortgage market, particularly to assist first-time buyers in navigating the housing landscape.

As Rigby navigates the complexities of her new role, the City is keenly observing her moves. The balance between business interests and consumer protections will be critical in determining her success as the new minister. Whether she can effectively manage this balance or become just another name in the City’s ever-turning wheel of political figures remains uncertain. For now, all eyes are on Lucy Rigby as she embarks on this pivotal journey in the heart of the UK’s financial system.