The Government’s revised tone about the UK’s economic prospects – deployed in Davos and across the airwaves – has been music to the ears of my peers in the City.
Davos, with hundreds of the world’s leading financiers, investors and CEOs in attendance, set the perfect stage for the Chancellor Rachel Reeves to lead this welcome change in approach.
The potential of a third Heathrow runway, plans to ease rules on non-doms and the surprise shake-up to the Competitions and Markets Authority leadership, are clear signals of the Government’s renewed intent to get growth going as a priority.
Delivery is key. And warm words must now be matched by bold action and swift implementation. My many years in the financial markets have led to a healthy regard for risk; one it seems the Government now shares – and not before time.
Government, regulators and businesses must now embrace risk and bet on Britain to unlock our full potential, from life sciences and AI to financial services and cybersecurity.
Make no mistake – this is not a call for complacency from those charged with protecting consumers. But our economy has been stagnant for too long, and we never quite re-balanced the risk register following the financial crash.
The Lord Mayor Of London, Alastair King
We welcome proposals from the Bank of England to set up a concierge service to help foreign firms invest in the UK.
And the City of London Corporation is supporting efforts to ensure the UK’s new Office for Investment matches its peers in Ireland and Singapore, which have successfully attracted significant global investors.
There are also things we can do at home to make our financial markets more attractive.
Reform of ISAs is one attractive area – why should those investing in purely in cash and non-UK equities have the same tax breaks as those who take the risk to invest into UK-quoted equities?
The incentives appear misaligned. Removing stamp duty on shares is another area ripe for revisiting.
As ‘cheerleader-in-chief’ for UK financial and professional services, I’ll be urging businesses to bet on Britain again and again.
I will be looking at the Mansion House Compact signed by our largest DC pension funds in 2023 and urging them forward in fulfilling the 2030 target to invest 5 per cent of funds into unlisted UK equities.
These investments are consequential to Britons across the country. They help fund AI start-ups in London; fintechs in Edinburgh; life science firms in Cambridge – all innovative businesses that make Britain great.
So, let us help them start, scale and stay here, creating the high-skilled and high-wage jobs that benefit our economy.
Re-adjusting our risk appetite can help encourage – as evidenced in the latest Bayes Business School research – the financial services sector to remove barriers to growth. Risk should be viewed as an opportunity, not solely a threat.
The sooner the UK embraces that, the better for our economy.
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