Rachel Reeves, the Shadow Chancellor, and Sadiq Khan, the Mayor of London, tell City A.M. readers that financial services needs a government on the side of innovation – not in the way
The UK is a world-leader in financial services – something we should be proud of and continue to champion. The industry generates billions of pounds of wealth for our nation each year, provides work for more than a million people and raises £100 billion for the public purse, which helps to keep our schools and hospitals running. When the sector succeeds, we all succeed.
We are a global capital for financial services because our firms were the fastest to learn and adapt. Today, the pace of technological change, the upheaval of the climate crisis, and the intensity of competition means – more than ever – the industry needs a national government that is on the side of sustainable growth and innovation, not in the way.
In the latest demonstration of how Labour will expand our economy and ensure the benefits are brought to every corner of the UK, we have developed a series of policies to increase the competitiveness, efficiency and size of our financial services sector.
All told, our proposals will boost financial services during the first term of a Labour government, protecting existing jobs in the industry and creating more opportunities and employment for the future.
A Labour Chancellor, and Treasury, will actively support the growth of regional financial centres alongside established hubs in London and Edinburgh. We will set the Financial Conduct Authority the task of working with industry to identify outdated and prescriptive rules, giving our firms the freedom to grow. While at the same time, increasing security for consumers by exploring the expansion of longer-term fixed rate mortgages, adopting a co-ordinated approach to fraud prevention, creating a national financial inclusion strategy, and better regulating the ‘Buy Now Pay Later’ sector.
Rachel Reeves and Sadiq Khan promise fintech support
Under a Labour Mayor, City Hall has not stopped banging the drum for investment for London around the globe – seeking to cement the city as the number one centre internationally for green finance. Under a Labour government, the UK will lead the way in sustainable finance by delivering the world’s foremost green finance regulatory framework and partnering with our financial services sector to meet our net-zero ambitions.
At the time when we should be reaching for the future, regrettably this Tory government has business increasingly looking over its shoulder.
Take fintech as an example. In 2022, Britain invested the second highest amount globally in the technology. We have fintech clusters in every nation of the UK. However, the innovations which propelled us to the head of the pack are being emulated elsewhere while existing legislation has failed to keep pace and is now acting against the interests of both industry and consumers. Our standing as a world leader in fintech is now at risk and our competitors are looking to capitalise. There will be no such complacency under a Labour government.
After years of economic failure, incompetence and uncertainty by successive Tory governments, Labour is ready to provide the stability, aspiration and dynamism demanded
As Artificial Intelligence (AI) becomes increasingly prevalent, Labour will ensure the technology commands the faith of consumers and that the UK becomes the go-to destination for firms to start-up and scale-up. We will deliver the next phase of Open Banking, embrace the huge potential of Open Finance, advance efforts to create a central bank digital currency and make the UK a global hub for securities tokenisation.
We are a nation small in size, but grand in vision – all of this is within our grasp, but only with a government willing to move us forward, rather than hold us back. After years of economic failure, incompetence and uncertainty by successive Tory governments, Labour is ready to provide the stability, aspiration and dynamism demanded.
The next Labour government will lay foundations for business to thrive, so our people can too. New ideas will be embraced, barriers to growth will be removed, every pound of investment will be fought for, and we will loudly and proudly champion the sectors in which we excel. The shared goal of Labour and financial services is progress – and in partnership, we will succeed for the benefit of all.
Rachel Reeves is Shadow Chancellor and Sadiq Khan is Mayor of London.