Oral Answers to Questions

Stephen Hammond Excerpts

Thursday 20th October 2016 Commons Chamber

[Mrs Theresa Villiers (Chipping Barnet) (Con)]

1. What discussions he has had with the Chancellor of the Exchequer on financial services and negotiations on the UK leaving the EU.

[Stephen Hammond (Wimbledon) (Con)]

10. What progress his Department has made in engaging with the financial services sector on the potential effect on its revenues of the UK leaving the EU.

[The Secretary of State for Exiting the European Union (Mr David Davis)]

The Chancellor and I are both determined to ensure we get the best possible deal for our financial services sector—a crucial part of our economy—and not just for the City of London but for the country more widely. Two thirds of financial services jobs are outside the capital, including 150,000 in Scotland. We are determined to ensure that this UK-wide industry continues to thrive. The Chancellor and I have met to discuss this, and, as one would expect, agree that financial services will be of great importance in these negotiations, that we must remain in a position to attract the brightest and the best in the global battle for talent, and that we will seek the best possible terms of trade for our financial services in the European market. We are also working together to maximise opportunities for financial services arising from our exit from the European Union. We have already met representatives of the financial services industry and expect to do so again as we shape our negotiating position.

[Mr Davis]

We are seeking to ensure a smooth and orderly exit from the European Union, and it would not be in the interests of either side—Britain or the European Union—to see disruption. To that end, we are examining all possible options, as one would expect. We are approaching these negotiations in good faith and with good will towards our negotiating partners—we hope the same applies in reverse—focused on the mutual interests of the UK and the EU, including financial stability. I would say that having London as the No. 1 global financial centre sitting at the heart of the global capital markets is not just in the UK’s interest but in the European Union’s interest. I am confident that everyone will see the value of not undermining that.

[Stephen Hammond]

In his answer to my right hon. Friend the Member for Chipping Barnet (Mrs Villiers), the Secretary of State talked about all possible options. Yesterday in the Treasury Committee, I asked the Chancellor whether he accepted the likely need for transitional arrangements. Has my right hon. Friend met regulators to discuss systemic risk, and major financial institutions to discuss loss of business, if those transitional arrangements are not put in place?

[Mr Davis]

The Chancellor’s response was much the same as mine will be. Yes, we have been talking to the European institutions, in particular, about this matter, and they take the same view as we do.