Leading financial services firms call on Government to clarify Brexit position for savings and investment
TISA, the investments and savings association, has submitted its initial proposals to HM Treasury regarding how the country’s savings and investment industry can thrive outside the European Union. Its recommendations, which are the outcome of a collaborative research project with its member firms*, are not dependent on firms having ‘passport’ rights and do not require the free movement of people. TISA believes this will demonstrate how leaving the EU can work for businesses, consumers and the UK economy.
The key recommendations that are emerging are:
1. The urgency of the situation: – our industry needs to know the Government’s proposed direction of travel now so it can make the necessary preparations in readiness for the new relationship with the EU and to secure free market opportunities with the rest of the world
2. Assuming that the UK will not be part of the single market: – this should not be an insurmountable problem for the savings and investment industry, provided that the Government targets what the EU calls “third country equivalence” in its negotiations through one piece of enabling legislation. This would enable a reciprocal arrangement to be enacted for the 8,000 EU firms that are doing business within the UK today
3. An opportunity to create a more streamlined regulatory framework: – focused on the needs of consumers. TISA suggests an “EU equivalent” rulebook for those firms or their subsidiaries that want access to trade financial services within the EU. Then a simpler tier of rules for everyone else, cutting away red tape from those firms that only want to service UK consumers
4. Attracting more global, non-EU financial services to the UK: – through the development of a well-regulated market that is appropriate for the world outside of the EU. Brexit provides the opportunity to grasp this challenge
5. Maintaining access to global professional financial services skills: – essential to keeping the UK as a world centre for financial services. UK firms need to feel confident that they have ongoing access to the pool of EU and non-EU talent, supported by a faster visa process, while those professional people already working in UK financial services need to be reassured that we want them to stay.
Commenting on TISA’s findings, Director General David Dalton-Brown said:
“We welcome the announcement on the Great Repeal Bill, but to protect the jobs of over a million people working in financial services and to allow UK financial services to prosper post Brexit, it is vital that firms can see a clear vision of what the Government’s negotiating stance will be so they can commence planning for its implementation.
“Our aim should be full recognition that the UK has third country equivalent status for its regulatory framework with the EU.
“This is a win-win opportunity. Many of the EU Directives, like AIFMD and MiFID II, already embody the concept and through enabling legislation it can be added to others, such as UCITs. This would facilitate the continuation of existing business, with minimal impact for the 113,000 UK jobs dependent upon trade with the EU and the 8,000 EU financial services that are trading inside the UK today.
“Major financial services firms operating out of the UK are looking for greater clarity on these important issues so that their Boards can take the necessary decisions to manage risk effectively.”
Looking forward to a future outside of the EU, David Dalton-Brown continued:
“Government should task the FCA to commence work immediately on a domestic only version of the regulatory rulebook. This should focus on cutting away most of the paperwork that consumers are expected to wade through to open a savings and investments account.
“We also need to dramatically speed up the process for authorising new market participants. It’s disappointing that many new authorisations for firms take so long and we can see other financial centres looking to attract business – and the UK’s growing FinTech community – from the UK by offering attractive authorisation and support services.”
The constant theme that shone through all TISA’s research meetings with its members was the importance of the quality of the people that work within financial services companies. Stressing the need for top talent both now and in the future, David Dalton-Brown underlined this key message:
“The UK is the world’s pre-eminent financial sector because we draw the world’s best people to come and live and work in our country. We must reassure these professional workers who are 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 financial services professionals from both Europe and around the world into the UK without delays or hindrance.”
*TISA’s collaborative research project involved 79 of its member firms that spread over 14 group meetings as well as a number of discussions with other industry bodies.
For further information, please contact:
Alistair Kellie – Telephone: 0207 680 6558/Email Alistair.Kellie@newgatecomms.com
Sara Neidle – Telephone: 020 7680 6550 / Email Sara.Neidle@newgatecomms.com
Jessica Hodson Walker- Telephone: 020 7680 6538/EmailJessica.HodsonWalker@newgatecomms.com
Notes for Editors
TISA is a not-for-profit membership association operating within the financial services industry. The focus of our recommendations and actions is improved outcomes for consumers and UK plc with this approach leading to a stronger UK financial services industry.
TISA’s growing membership comprises over 150 firms involved in the supply and distribution of savings and investment products and services. These members represent many different sectors of the financial services industry, including asset managers, insurance companies, fund managers, distributors, building societies, investment managers, third party administrators, consultants and advisers, software providers, financial advisers, pension providers, banks and stockbrokers.
TISA has a successful track record in working cooperatively with government, regulators, HMT, DWP and HMRC to improve the performance of the industry and the outcomes for the public. Effective policy and regulation and the creation of efficient industry infrastructure continues to be the major focus for our members. TISA is unique in that it represents the entire financial services industry, incorporating cross-sector policy, industry and technical expertise. Whilst we maintain a solid partnership with government, the regulators and wider industry, we remain independent and develop neutral views and opinions. This impartiality is reflected in our ability to drive development projects which improve industry performance and consumer outcomes, putting us in the unique position of being able to constantly challenge the status quo to bring about material improvement.