It seems as if the only thing certain about Brexit is a period of uncertainty. But the real questions we should be asking are: ‘How uncertain?’ and: ‘For how long?’
Following the referendum result, Tisa established a steering committee and working groups drawn from our members to determine how Brexit will impact the UK’s savings and investment industry and to seek greater clarity from the government.
Seventy-nine member firms were involved and in our initial submission to HM Treasury we have urged the government to set out its vision for UK financial services post-Brexit.
One of the priorities must be to protect the jobs of more than one million people working in the UK financial services sector and to ensure that it prospers post-Brexit.
It is vital firms can see a clear vision of what the government’s negotiating stance will be so they can begin planning for its implementation.
Failure to do so will only mean continued uncertainty; it could also lead to decisions made at UK financial services boards that see them reducing business risk by moving operations and people to the EU.
Our initial Brexit work focussed solely on the access to the EU market for UK-based savings and investment businesses.
Our view is that Brexit creates the opportunity for a more streamlined UK regulatory framework.
A simpler tier of rules for everyone will cut away red tape from those firms that only want to service UK consumers. This could be achieved through full recognition that the UK has ‘third country equivalent’ status for its regulatory framework with the EU.
This is a win-win opportunity, as many of the EU directives, such as AIFMD and MiFID II, already embody the concept and through enabling legislation it can be added to others, such as Ucits.
This would enable the continuation of existing business, with minimal impact for the 113,000 UK jobs dependent upon trade with the EU and the EU-based companies that have established 8,000 EU passports to trade in the UK today.
Crucially, we have a chance to build the UK’s position as a global centre for financial services.
By developing a well-regulated market that is appropriate for the world outside of the EU we can entice non-EU financial services firms from countries such as India and China.
However, if we are to draw more global business to the UK, we must retain and attract top talent both now and in the future to what is the world’s pre-eminent financial sector.
The government needs to reassure those professional workers here today that they are welcome to stay and we should also seize the opportunity of Brexit to streamline the visa process so that going forward we can get the best professionals from Europe and around the world into the UK without delay.
Unfortunately, it looks like the uncertainty will last for some time yet.
However, it is clear from our discussions there are grounds for optimism.
