Agenda item

The Director of Economic Development, the Director of Communications and the Remembrancer to be heard.

The Policy Chairman updated Members on the City Corporation’s position following the publication of the Brexit White Paper, and the related activity that had been undertaken thereafter, including an invitation to the Policy Chairman from the Secretary of State for Exiting the EU to attend a Business Summit at Chevening House and an opportunity to give evidence to the Select Committee for Exiting the European Union. Members noted the three main asks of the City Corporation to Government over the next few months:

1.    With only a few months to go before we leave the EU, it is urgent that the government redoubles its effort to finalise the Withdrawal Agreement and ensure that a transition/implementation is in place to give certainty to businesses;

2.    Of equal urgency is the need to find a common way forward to address cliff edge issues, including contract continuity and ensure two-way data flows;

3.    To put in place, where possible, unilateral measures to ensure business can continue irrespective of the agreement with the EU.

The Policy Chairman also outlined to Members that the City Corporation’s interests may start to differ from the sector.

The Assistant Director of Economic Development, the Director of Communications and the Remembrancer also made the following points:

·         Mutual Recognition Regulation (MRR) was an ask that the financial sector could coalesce behind, and an ask for equivalence or enhanced equivalence would now be more difficult, even within sub sectors;

·         The City Corporation would continue to work closely with EU governments;

·         The Policy Chairman’s statement to Court stressed the pragmatism element of the City Corporation’s messaging on Brexit;

·         During the Select Committee hearing, the Association of British Insurers (ABI) were particularly exercised by the EEA option and the impact of rule-taking on their industry.

A Member requested a copy of the transcript of the Select Committee hearing.

Members then discussed the White Paper and made the following key points:

·         Contract continuity was an important point to make to Government. Lots of points around English law could be so technical, that there was a risk they could get lost;

·         There was concern about what the Government might agree to in the 11^th hour which compromised from the Chequers deal further;

·         There were other areas of law which were portrayed positively in the White Paper and the City Corporation should support the Government on the technical parts of the legal implications through channels such as the Brexit Law Committee;

·         A Member observed that the White Paper had made several announcements on intellectual property, which is key to the UK as a hub for global companies. Whilst it had been well-received that the Paper offered solutions to conversion of some European rights to UK rights, other areas had not been properly addressed and the City might be able to usefully help. The Member reminded the Sub-Committee that the City Corporation had supported the bid for the European patent court. The White Paper stated that it wanted to keep the UK as a participant in that court, but as it would require treaty change, and due to the recent change in Brexit secretary, there had been an impact on those dealing with that issue. The Member acknowledged that the Government needed help to negotiate, and it was suggested this could be something the City can help with.

·         The City Corporation and the sector should now make the choice between fighting to stay in the Single Market or focus on long-term issues once the UK has left the EU to ensure that London remains a world-leading financial centre;

·         The financial services sector had not been given what they asked for in the White Paper compared to other sectors;

·         The City Corporation’s focus should be on financial stability and reducing any sudden shocks on the economy;

·         There was concern from the Bank of England as it did not want to be a rule-taker;

·         The Audit and Risk Committee were reviewing the risk around Brexit and contingency planning for the City Corporation on its property portfolio. Members felt this should also be reported to the Public Relations and Economic Development Sub Committee in future;

·         The UK adopting the Norway model in the short term could be useful, however a Member pointed out that intention behind the Norway model was designed as a short-term stepping stone;

·         Members discussed how it was important for focus to remain on the UK’s position in a global economy and noted how many other items on the Sub Committee’s agenda that day concerned involvement with markets internationally;

·         That other activity that the City Corporation had a locus in included skills, future migration, Green Finance Institute, Cyber Griffin initiative, amongst other things;

·         That the City Corporation’s legitimacy depended on the backing of the sector and that the sector had asked the City Corporation to stick with options that remain within the Government’s red lines;

·         That a degree of agility and flexibility was required over the coming months;

·         Members discussed whether the City Corporation’s messaging recently had been too negative. The Director of Communications advised that there was a reduced amount of positive messaging that the City Corporation could represent following the White Paper, and that the media had a limited appetite for good news in general. A Member commented that sometimes unexpected good news also gets media coverage;

·         The City Corporation should promote its messages around attracting talent to the UK and there should be clear asks and proposals;

·         The Assistant Director of EDO advised Members of a new piece of work that had just been commissioned by the City Corporation to research and produce recommendations on enabling the immigration process to be as simple as possible. Key messages from the research would be disseminated at the Conservative Party Conference in October;

·         Sections of the White Paper included the asks of the Professional and Business Services Council via the letter that was written to the Prime Minister a few weeks’ ago.

RESOLVED, that:

·         A transcript of the Select Committee for Exiting the European Union hearing on 24 July 2018 be circulated to Members of the Sub Committee for information, when available;

·         Risk reports on Brexit be reported to future meetings of the Sub Committee.