The UK’s Labour Party initiated a comprehensive review aimed at unleashing the potential of the financial sector, with a focus on boosting economic growth in preparation for the anticipated upcoming election next year, where polls indicate they may emerge victorious.
Labour’s financial services spokesperson, Tulip Siddiq, emphasized the importance of the finance industry as a vital asset for Britain.
She expressed the party’s commitment to taking the necessary steps to unlock its full potential and reinforce London’s position as a global financial hub.
Siddiq stated that the City has consistently called for long-term stability and a clear policy direction from the government.
This move signifies a shift in Labour’s stance, which had previously been perceived as hostile towards the business community, as they seek to assure the City that they will not adopt a harsh stance against bankers if they come to power.
In light of the financial challenges facing the country, both the current government and Labour are heavily reliant on private investments and pension funds to support infrastructure development, business expansion, and clean technology initiatives.
Post-Brexit, the UK has undertaken a comprehensive review of its financial regulations, conducting over 30 public consultations on reforms under the “Edinburgh Reforms” initiative, covering areas like listing rules and insurer capital requirements.
However, lawmakers contend that few changes have been effectively implemented, and the impact has been limited.
Concerns are mounting in the City regarding its global competitiveness as UK companies, such as Marex, a commodities broker, and Arm, a chip designer, opt to list in New York rather than London.
Additionally, EU financial centers in Frankfurt, Paris, and Amsterdam have posed new competition since Brexit.
Labour leader Keir Starmer, along with Siddiq and other party officials, convened with representatives from the financial sector in Edinburgh to mark the one-year anniversary of the introduction of the “Edinburgh Reforms” by Finance Minister Jeremy Hunt.
The Labour review will be guided by an advisory panel featuring prominent figures like David Schwimmer, CEO of the London Stock Exchange Group, Elizabeth Corley, Chair of Schroders, Nigel Higgins, Chair of Barclays Group, Ron Kalifa of the Bank of England, John Kingman, Chair of Legal & General Group, and Shriti Vadera, Chair of insurer Prudential.
The review, supported by consulting firm Oliver Wyman, will focus on five critical areas: capital markets, competitiveness, consumer protection, innovation, and sustainability.
The panel’s final report is expected to be released in early 2024, shaping Labour’s election manifesto.