Rishi Sunak has rushed out plans to protect Britain’s powerhouse financial services sector after failing to reach a Brexit deal with EU leaders.
In a speech in the House of Commons, the Chancellor lashed out at officials in Brussels for refusing to entertain an agreement which would enable banks, insurers and fund managers to continue to trade freely across the bloc.
He implied their intransigence has left the UK with no option but to plough ahead on its own and publish its own post-Brexit rules.
Rishi Sunak lashed out at officials in Brussels for refusing to entertain an agreement which would enable banks, insurers and fund managers to continue to trade freely across the bloc
These will effectively ensure EU financial services firms continue to have preferential access to UK markets after the post-Brexit transition period ends on December 31.
To continue operating on a similar basis in the EU, Britain needs an ‘equivalence ruling’ to replace the ‘passporting’ regime which allows members to trade freely across the bloc.
With the end of the transition period looming, bosses of banks, insurers and fund managers are worried they will lose unfettered access to EU markets.
Business leaders remain nervous that London will lose some of its clout of a financial centre and that many financial services jobs could move to rival cities.
Sunak said he was not prepared to wait any longer. He told MPs: ‘I remain firmly of the view that it is in both the UK and EU’s interests to reach a comprehensive set of mutual decisions on equivalence.’
The refusal of the EU to budge on a financial services deal has infuriated business leaders who believe Brussels is keen to exploit Brexit to boost rival financial centres including Frankfurt and Paris.
Sunak’s decision to take unilateral action was welcomed last night by business leaders.
Allie Renison, head of EU and trade policy at the Institute of Directors said: ‘The Chancellor is making the point that the UK is willing to take the moral high ground, put trade first and be more flexible – whether a deal is reached or not.’