Friday 20 November 2020 6:56 am

MPs launch inquiry with eye to bolstering City after Brexit

MPs have launched a major new inquiry aimed at strengthening the role of the City of London as a global financial hub after Britain leaves the EU’s trading arrangements in January.

The Treasury Committee of MPs said it will dig into how financial services regulations should be set and scrutinised by lawmakers, and how regulators are funded.

Read more: Brexit: ECB demands UK banks to move City staff to Europe despite Covid

The Committee’s role is to scrutinise the UK’s economic policy, making it very active during the coronavirus crisis.

It has kept a close eye on the government’s economic response to the virus, particularly its coronavirus business loans. The Committee has also regularly questioned Bank of England officials, which it will do again on Monday.

However, its sights have now turned to the standing of the City after Brexit. It comes amid fears that Britain’s financial sector is not being adequately considered during negotiations.

Chair says financial services ‘crucial’

Committee chair Mel Stride said: “The financial services sector is a crucial component of the UK economy. There are choices to be made by the UK government that will have long-lasting impacts.

“As part of our new inquiry, we’ll examine how the sector can best take advantage of the new trading environment, what regulatory changes should be made, and what role Parliament should play in influencing and scrutinising such changes.”

The cross-party group of MPs will consider what immigration and skills policy will help the sector thrive in the future. 

It will also weigh up whether the UK should open itself up to more external competition from outside Europe. Currently, regulatory barriers apply to “third countries”.

Read more: Brexit negotiations to continue remotely following positive Covid case

Crucially, it will delve into how regulations should work after Brexit. Britain will no longer be subject to EU rules in most areas.

The Committee said the deadline for evidence submissions from interested parties in 8 January 2021.