Labour's new shadow City minister has vowed to build bridges with the City and defy the sceptics

Mark Sands
Follow Mark
Reynolds took up the shadow City portfolio from the start of this week

Labour's new shadow City minister has vowed to build bridges with the financial and professional services sector in defiance of sceptics who do not see the party as a natural ally of the City.

City A.M. first revealed the appointment of Jonathan Reynolds last month, although the Greater Manchester MP only began the role this week.

In his first interview since being appointed, Reynolds admitted some will be dubious of his party's commitment to the City under Jeremy Corbyn and shadow chancellor John McDonnell.

"I recognise there's scepticism. People feel strongly, and not just about our current personalities. There was also scepticism about Ed Miliband and others in Labour," said Reynolds, who returns to the shadow cabinet after resigning in January.

“But I want the City to see me, and us in the shadow Treasury team, as a constructive partner, making sure that the decisions in relation to Brexit are ones which are in the best interests of this country and in particular the financial services sector and the jobs that it creates.”

He added: “I understand there's some hesitancy to see Labour as a natural ally, but given some of the rhetoric coming from the Conservatives at the moment, they might find they might get a better hearing from me than with the government.”

Read More: Theresa May's statism won't deliver a more prosperous post-Brexit Britain

In particular, Reynolds hit out at the government's mooted plans to force companies to disclose the proportion of foreign workers they have on the books to “flush out” businesses failing to take on UK talent.

Home secretary Amber Rudd announced the plans at the Conservative party conference, but a furious reaction from industry has seen the government slam into reverse, indicating the proposals may never come into effect.

“It feels like politics is being pushed into extremes, and obviously some people are feeling the economy is not really working for them,” Reynolds said.

“But it would be a mistake to miss a more fundamental point, which is that successful economies must be open to talent. And that a highly skilled and international workforce is not a badge of shame.”

While May looks set to push ahead with plans to put workers on boards, Reynolds questions how far the Prime Minister will follow through with her zeal to reposition the Conservatives.

“It's impossible for Theresa May to rebrand the Conservatives as the party of the workers, and I'm very sceptical about her nods in that direction,” Reynolds said.

“I'm interested in things like how can business people be given an incentive to think about things in the long term – is Theresa May interested in that? I'm not sure. But we would welcome her coming on to our territory.”

Read More: Two Labour whips quit as Corbyn continues rebuild

In a marked departure from the approach of his predecessor Richard Burgon, now shadow justice secretary, Reynolds has been highly visible in the City and has already held meetings with the FCA and Bank of England governor Mark Carney.

And Reynolds vowed to be more accessible than Burgon, who was ridiculed over his lack of meetings with City figures.

“The City is going to see someone out there, and they will find an open door from me.”

The Labour MP said his early engagement with the City has already emphasised to him the importance of passporting in the aftermath of Brexit.

But Reynolds admitted that if the UK does not secure Single Market membership that may make passporting impossible, meaning that Labour will seek the best possible replacement for the City's EU access, echoing BBA chief executive Anthony Browne's recent warning that current equivalence options are “not sufficient”.

However, he also warned that some in the sector remain shell-shocked following the Summer's referendum, in which many – though not all – advocated a Remain vote.

And noting the decision of Russian institution VTB to this week publicly flirt with relocation from London, Reynolds said that other institutions are also working on contingency plans.

“Some of those City voices are afraid that if they make that clear, people will either say “we don't believe you” or “we don't care”,” he said.

“Those people have got to work with us and get the self-confidence back because there is no doubt this is an incredibly serious situation for the UK.”

Related articles