The City has blasted the government’s new blueprint for Brexit, after it was revealed the preferred model for financial services has been dropped.
The long-awaited Brexit white paper was published early this afternoon. Although much of the 100-page document dealt with matters that had been outlined following Chequers, the plan to drop mutual recognition as the UK’s negotiating position for financial services has come as a shock to the industry.
Policy chairman of the City of London Corporation Catherine McGuinness was scathing.
“Today’s Brexit white paper is a real blow for the UK’s financial and related professional services sector,” she said.
“With looser trade ties to Europe, the financial and related professional services sector will be less able to create jobs, generate tax and support growth across the wider economy. It’s that simple.
“The sector has been clear since the referendum: Equivalence in its current form is not fit for purpose so any “enhancements” to this regime would have to be substantial.
“As the EU’s gateway to capital, the UK is a significant trading partner for the bloc. It’s in the interests of households and businesses on both sides of the Channel that an ambitious future trading relationship, covering services as well as goods, is secured.
“Failing to secure such a deal would put up unnecessary trade barriers and runs the risk of fragmentation of financial markets, increasing costs and reducing choice for consumers.”