In a speech outlining where he expects growth to come from in the coming years, the Prime Minister said that tourism, green energy, pharmaceuticals, advanced manufacturing and aerospace were the five “industries of the future”.
He failed to name-check a swathe of successful City sectors that have accounted for significant growth in recent years – such as insurance, law, accountancy, fund management and business services – a move that will be seen as a slap in the face by many in London’s business community.
Although Cameron said he didn’t want to make “banking smaller or the City of London smaller”, he only mentioned the Square Mile once in the 11-page speech. The creative industries and education were also ignored.
UK financial services alone paid £53.4bn in tax last year – more than any other sector. Cameron’s decision to downplay the role of financial and business services is at odds with the strategy of other successful economies, such as New York, Hong Kong and Singapore, which are fighting to grow these industries. It also goes against the view that the UK has a comparative advantage in high value added business services of the sort London specialises in.
Last night, a Downing Street source insisted the Prime Minister had not intended to talk down the City, and said it was “a given” that it was a growth industry. “The City is a hugely important growth industry, and it would be quite wrong to interpret otherwise,” she said
But a spokesman for Boris Johnson said: “The Prime Minister is right to identify vital industries that we all wish to develop and grow in the future to create wealth.”
“But the Mayor would argue that this should not come at the expense of industries that are already world leading, and which have produced enormous benefits for the capital and our country”.