It will be one of the
most significant votes
that parliament has
held for many years.
Theresa May is on a mission.
Now that her Brexit deal has
been signed off in Brussels,
she is determined to get
it through parliament.
But to have any hope of
convincing the sceptics
on both sides of the debate she
knows she must first win over
the people of Britain
and their employers.
On it will depend whether
we move forward together
into a brighter future or open
the door to yet more division
and uncertainty.
No employers are more
important than those
in the City of London.
It accounts for up to 20
per cent of the economy
and in the last financial
year generated £72bn of tax.
An outcome on Brexit
that is bad for the City
will be bad for Britain.
The City of London is Europe's
gateway to global capital.
It's going to remain a great
global financial centre
whatever happens through Brexit.
I'm not saying that we
won't lose some business
as a result of Brexit.
Of course we will.
We'll lose some business
and some jobs as a result.
Many City financiers still
bemoan the impending end
of the UK's membership
of the single market
and its system of being able
to sell products and services
from London to
clients across the EU
under so-called
passporting rules.
Well, we still think that the
mutual recognition approach
would have been the best, but
that's water under the bridge
because that's plainly
not going to happen.
For Catherine
McGuinness, policy chief
at the City of
London Corporation,
it still clearly rankles
that the government
has been arguing in Brussels
for a thin financial services
deal based on maintaining
parallel regulations,
a so-called equivalence model,
rather than mutual recognition,
a more bespoke and ambitious
concept that many financiers
had lobbied for.
There's a lot wrong with the
current equivalence model.
It's intensely political.
It's not permanent,
and decisions
can be withdrawn on as
little as 30 days' notice.
And it only covers about
a third of the sector.
But we've got to
start from somewhere.
There's an indication
in what we've
seen of the future
framework of an intention
to build on supervisory
co-operation,
regulatory co-operation.
We've got to build.
For optimists, the most
important part of the deal
is the 21-month
transition period
that will follow
Brexit in March 2019
because that will allow
the skeletal principles
of a future relationship
in financial services
to be built out into an enhanced
equivalence arrangement,
as they put it.
As it stands, the UK is
leaving the single market.
So the challenge now
is how we move on
to creating this new
equivalence regime.
I absolutely accept there
are about half of this...
about half a page of this in
the political declaration,
but that covers the whole
economic relationship.
And the critical point
is, it's in there,
and so we can build on it.
There is a hook for
the negotiations.
It talks about autonomy.
It talks about a close,
structured, regulatory
relationship between
the UK and the EU.
And there are, of course, going
to be negotiations around that.
But the point is
that we're moving,
I think, in the same
direction, and that
is about making
sure that there's
the best possible -
within the permutations
and the limitations
that we have -
the best possible
economic relationship
on financial and related
professional services.
Thin as the financial services
model might look for now,
most in the City feel that it's
time to rally behind the deal
that Mrs May has struck.
I think that finance has shown
that it can adjust and build
in significant change into
its plans and future strategy.
The snag, though, is that
parliament is rather less
enthusiastic than the City.
And that prospect has convinced
many former Remain campaigners,
and even some
hardline Brexiters,
that the right thing to do is to
ask the country to vote again.
If parliament is unable to
support the current deal,
then I do think there is
a case for a second vote,
but only if parliament is unable
to support the current deal
because I think in
those circumstances
we're faced with a very
stark choice, which
is moving towards an exit
of the EU without a deal.
And I think that is a calamity,
and I think that is a disaster.
And that is something for
which we are not ready
and for which plans have
not been properly made.
If we follow the
path to a no-deal,
financiers aren't really
talking of Armageddon.
They do stress there are some
key outstanding issues relating
to data access
and the continuity
of certain derivatives
and insurance contracts.
But banks, asset managers,
and insurance companies
have detailed contingency
plans in place
to cope with a cliff edge.
One thing is for sure, though:
the economic disruption
of a no-deal Brexit
will be significant.
More jobs and activities will
move to Frankfurt, Paris,
and Dublin, and the tax take
from the City in 2019 will not
be £72bn.
