Report claims financial services could boost economy by further £43bn

 
Catherine Neilan
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Brexit offers new opportunities as well as new challenges (Source: Getty)

TheCityUK and PwC are urging government and financial industry players to adopt a series of new recommendations that it claims will add £43bn to the UK’s economy by 2025.

A report, published today, says the industry has huge post-Brexit opportunities to boost export competitiveness, innovation and efficiency, which will lead to an additional £16bn of industry gross value added (GVA) and £43bn to the economy as a whole by 2025. Some 70 per cent of this additional output will come from cities outside of London, with the North East, Northern Ireland and the West Midlands identified as the three top regions.

Read more: Assessing the implications of Brexit on investment professionals

Chief among the recommendations are to adopt a tripartite strategic partnership between government, the industry and regulators. The report urges government to take the lead in setting up a joint “coherent strategy that ensures positive customer outcomes”.

It also urges the industry to focus on rebuilding trust, create customer-centric products – particularly those that “address unmet societal needs, and develop cyber resilience capabilities to protect the data and digital assets of both customers and firms”.

Read more: Skills gap to cost UK £90bn as Brexit piles on pressure

And with Brexit on the horizon, the report stresses the need for UK regulators to lead the development of “an open and compatible” global financial system.

“They should embed a strong, proportionate and internationally attractive regime, applying judgement-based decision making,” the report says.

Miles Celic, chief executive of TheCityUK, told City A.M. the recommendations were based on the view that government was leaning towards a softer Brexit as outlined by Philip Hammond’s recent Mansion House speech.

“That [speech] provides the launch-pad for the recommendations that we have set out,” he said. “[Brexit] does present some challenges, but also real opportunities – for example, what we can do around attracting talent, the regionalisation of supervision and regional centres acting as incubators or laboratories for the growth of industry… We are seeking to set out a vision for what our industry can do to contribute to the UK’s success outside the EU.”

Mark Hoban, TheCityUK board director and report chair, added: “This vision is ambitious and delivering this transformation cannot be done by the industry alone. A strategic partnership with government and regulators is essential to its success and ensure the UK remains the world’s leading financial centre meeting the needs of its domestic and international customers.”

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