The Bullet points from my Policy Exchange strategy paper on The City
• The City has suffered from benign neglect, and now needs the Government to go into battle for it.
• A strategy and clear vision is needed for the City and UK financial services.
• That strategy can outline a bigger role for the City in helping the UK economy at home and overseas, and pinpoint how to improve the City’s competitiveness in the face of an aggressive EU and intense global competition.
• Financial services have a critical role to play in achieving the levelling-up agenda and in delivering more balanced economic growth.
• The UK should stand its ground in the face of the EU’s stance. This points to the need to diverge from the EU on financial services regulation when it suits and to make London the attractive venue for parallel markets in euro-denominated instruments. There is also the need to reassess the resilience of the UK financial ecosystem.
• London’s competitiveness depends upon: safeguarding or enhancing its inherent characteristics such as the rule of law and infrastructure; its regulatory environment; and being a place where clients want to conduct business, helped by deep and liquid markets.
• A new eight-point plan to revitalise financial services regulation is proposed, based upon clear principles, endorsing and promoting global standards and being at the forefront of modernising regulation.
• Re-examine MiFID II and Solvency II and, within this, re-establish the City’s expertise in research and, also, strengthen London’s position as a global centre for insurance.
• Strengthen the City’s infrastructure, including data centres.
• Take steps for the UK to excel in future growth areas such as digital currencies, FinTech, Green Finance, Islamic Finance and electronic and automated trading. Governments should not aim to micro-manage, but to help provide the incentives and to create the environment in which London and UK financial services will thrive.
• Amend the structure and remit of committees in Parliament to ensure accountability of the financial services industry.
• While it is important to be realistic that, in some areas and for some firms, leaving the EU has created challenges and triggered change, it is time for the UK and the City to outline a clear, positive message that changes the terms of the debate that is often pessimistic and wrong about prospects for the City.
• There are 26 policy recommendations.