London Stock Exchange: Decline in UK Funds

Baroness Kramer Excerpts

Thursday 13th February 2025 Lords Chamber

[Lord Livermore (Lab)]

Stamp taxes on shares raise more than £4 billion a year in revenue. Targeted design features such as the exemption for transfers made on growth markets also support the UK’s competitiveness. This matter is out of scope of the pensions review, but we of course keep all taxes under review.

[Baroness Kramer (LD)]

My Lords, the London Stock Exchange suffered its biggest exit in a decade in 2024, with 88 companies moving out of the market compared with 18 new listings. The drop in liquidity and trading activity began with the 2008 financial crash but accelerated significantly with Brexit. We all want a rebound, but will the Government take the necessary steps to rebuild liquidity by strengthening our relationship with the EU? A customs union would be a good first step; as one investor said to me, “Outside of the EU, why choose London over New York?”

[Lord Livermore (Lab)]

I am grateful to the noble Baroness for her question, and she knows I agree with her analysis of the effects of Brexit. Firms may, of course, choose to list in other countries for a variety of reasons, and the Government appreciate that there is a perception that firms, especially tech firms, will have larger valuations in the US. We are determined to change that perception, which is why the Government are taking forward an ambitious programme of reforms to boost the attractiveness of UK markets and to support firms to start, scale, list and, importantly, stay here. As she knows, through the Government’s work on the EU reset, we will absolutely strengthen our relationship with the European Union.