The Lord Mayor of London has accused the Government of “missing the point” of the City as a key national asset after failing to champion financial services in Brexit negotiations.
William Russell, a former investment banker and the 692nd holder of the office, said the Government’s approach to financial services in the talks was “disappointing” as the Square Mile faces up to the loss of passporting rights and regulatory equivalence from January.
Much smaller industries, such as fishing, have dominated negotiations and Mr Russell said the City “would have loved to have had more representation”, claiming the UK’s financial sector had been a victim of its own success.
“They probably look at us and say ‘they’re going to be all right’, but I think that they’re missing the point because we’re such a critical part of what we have in the UK,” he said.
The Lord Mayor also said the City had a crucial role to play in the Government’s ambitions on green investment and “levelling up” after Rishi Sunak, the Chancellor, announced plans for the launch of the UK’s first “green bond” at the Green Horizon summit this month.
Mr Russell said financial services were “without a doubt one of the best assets we have and it needs nurturing”.
“In the City, when it comes to the levelling-up agenda, when it comes to green finance, this whole green agenda is not going to work without finance, hence we had the summit,” he added. “It’s a critical part of it.”
The Chancellor has also launched a review of the City’s listing rules headed by Lord Jonathan Hill, the former EU financial services commissioner, to attract more tech floats away from New York.
Mr Russell backed a potential move to cut requirements for companies to float at least 25pc of shares to encourage founders. “Because these tech companies are coming to the market where their valuations are always high – too high – 25pc is probably not the right percentage,” he said.
But he argued that a bigger priority to encourage tech was the reform of rules deterring UK pension funds from investing in venture capital, leading to US players accounting for 60pc of investment into London fintechs this year.
“In a way, we’re giving away our family silver because we aren’t in the right position to make those investments ourselves,” Mr Russell said.
A Treasury spokesman said the Government planned to “renew the UK’s position as the world’s pre-eminent financial centre”. It said: “By bolstering the dynamism, openness and competitiveness of the sector, we will ensure the UK moves forward as an attractive and well-regulated market, leading the world in pioneering new technologies and shifting finance towards a net zero future.”