As featured in the Belfast Telegraph
With the EU referendum on 23 June now firmly within our sights, it is an ideal time to highlight the role EU membership has played in helping to make the UK the world’s leading financial centre. This is important because the strength of UK-based financial and related professional services on the global stage helps to fuel industry jobs on high streets right across the UK. It also sees us pay more tax to the Exchequer than any other sector. Leaving the EU may not be ruinous for the UK economy, but it does risk damaging the UK-based industry, and as a consequence, risks leading to the loss of jobs from Belfast to Bristol and beyond.
International businesses flock to cities across the UK like Belfast – a flourishing financial and related professional services centre, with access to the EU Single Market of 500 million consumers often topping their list of reasons for doing so. But we can’t simply assume we will always stay on top; just ask the Venetian bankers of old.
The outcome of the EU referendum, whichever way it goes, will be keenly felt by financial and related professional services firms in Belfast and across the UK. Given the significant benefits the industry reaps from EU membership with Single Market access and the ability to do business or sell services in all other 27 Member State being just a couple of those, it stands to reason that an overwhelming majority of industry leaders – 84% of them – want to stay in a reformed EU.
And this doesn’t just reflect the views of those in London. Two-thirds of the 2.2 million people working in financial and related professional services do so outside London. This includes the 18,500 based in Belfast and 32,000 overall across Northern Ireland. Together, they contribute £2.3bn to the Northern Irish economy (6.1% of the total GVA in the region) and in Belfast alone, account for 10.3% of the city’s GVA.
If the UK leaves the EU, international firms currently based in UK financial centres like Belfast may consider alternative locations from which they could easily trade with the continent and access its Single Market. It might also make attracting new foreign direct investment more challenging – firms, for example, may consider the benefits of other, rival financial centres. Given overseas businesses invested £581bn in the UK between 2004 and 2014, these are not trivial numbers.
Regardless of the outcome, this summer’s referendum on the UK’s membership with the EU will be a once in a generation event, with lots of hard work to follow. And while it isn’t the place of businesses to tell people how to vote, we do have an important role in explaining the consequences of different outcomes to ensure people head to the Ballot Box with all the facts they need to make an informed decision.