Future of Financial Services

Kevin Brennan Excerpts

Monday 9th November 2020 Commons Chamber

[Rishi Sunak]

The hon. Lady talked about moving jobs out of London. It is already the case that the majority of financial and professional services jobs—two thirds—are out of London. I completely agree with her that Scotland has a proud heritage in financial services, and long may that continue.

With regard to providing certainty for firms and the support given to them, the hon. Lady will be aware that we put in place a temporary permissions regime some time ago, which provided that certainty to overseas firms needing to continue operating here after the transition period. They have known about that for a while, and it has been warmly welcomed. With regard to specific financial support, I point her to the announcements on input VAT, which will ensure that UK exports of financial services to the EU are not at a competitive disadvantage. Those firms will be able to reclaim input VAT, which will be worth several hundred million pounds in benefit to them, wherever they are in the UK.

The hon. Lady mentioned the ABI. I think that the ABI will warmly welcome the review that we have put in place on Solvency II. The feature of our insurance industry is the prevalence of long-term annuities. The capital treatment of those is not well managed by European rules, and there is an opportunity for us to improve things in that area, which is why the ABI has, I think, warmly welcomed our review of the Solvency II insurance regulations.

Lastly, the hon. Lady talked about the fact that others might wish to use equivalence as a political weapon. As I have set out, that will not be our approach. We will approach equivalence in a technical and outcomes-based way and seek always to provide transparency and stability, because in doing that, we will cement our reputation as the best place to do financial services in the world.

[Kevin Brennan (Cardiff West) (Lab)]

I listened carefully to the Chancellor, and he announced a green curve, a landscape review, a call for evidence, a taskforce and, God help us, a road map. Where is the bold action that is needed on green jobs and green finance? What people want is not a technical discussion but the sort of initiative that will allow things such as the Swansea bay tidal lagoon to be developed. Is he just paralysed by Treasury orthodoxy, which killed that key green project?

[Rishi Sunak]

The hon. Gentleman asks about bold action on green measures. I have announced today that we will be the first major economy in the world to mandate the recommendations of the Task Force on Climate-Related Financial Disclosures, doing so across the economy by 2025. That demonstrates both boldness and leadership on this vital issue.