Tuesday 3 July 2018 12:57 pm

Brexit: UK’s services sector pleads for mutual recognition deal in letter to Prime Minister

Catherine Neilan is head of politics and investigations at City A.M.

Catherine Neilan is head of politics and investigations at City A.M.

Some of the biggest firms in the UK's services sector have written to the Prime Minister, urging her to secure a future trade deal that puts mutual recognition at its heart.

The letter, coordinated by the Professional and Business Services Council and signed by the likes of KPMG and Deloitte, Allen & Overy and Clifford Chance, the City of London Corporation and TheCityUK, makes yet another plea for the UK government to pursue mutual recognition, arguing it is the only way for service industries to thrive after Brexit.

As well as mutual recognition, the letter demands "reduced uncertainty" during transition and the ability to hire "the best talent from overseas, whether from the EU or beyond". It also calls for data sharing and other existing cooperative acts between the UK and EU to continue after Brexit.

"Failing to negotiate these elements would impair our ability to provide our services with the same range, depth and speed our clients around the world experience today, damaging their businesses and putting our sectors at a distinct competitive disadvantage," the letter says.

"We took comfort from your Mansion House speech in March 2018, which highlighted your awareness of these issues; Greg Clark’s speech at the International Business Festival last week reinforced that.

"The EU has the balance of trade in goods in its favour and it is understandable that they will seek to prioritise it in the negotiations. However, the UK needs to get the right deal on professional and other services given our relative strengths and current competitive position."

Chancellor Philip Hammond recently reiterated his personal commitment to the cause, using his Mansion House speech to slam enhanced equivalence as "nothing to do with equivalence and everything to do with an ambition to force the location of business into the EU".

However, fears are growing that the EU will refuse to budge when it comes to a bespoke deal. City A.M. revealed back in April that City figures involved in negotiations were expecting little more than a "token, minimalist" deal – something which was echoed by Theresa May's chief Brexit adviser Olly Robbins yesterday.