TheCityUK calls on Chancellor to deliver key reforms to accelerate growth

14 November 2023

Ahead of the Autumn Statement, TheCityUK has set out a series of reforms that will bolster the UK’s attractiveness as a place to invest, list and innovate, accelerate growth across the country and ensure its long-term competitiveness as a world-class international financial centre. 

In its Autumn Statement submission, TheCityUK encourages the Chancellor to focus on delivering greater levels of investment in UK businesses including through public equity markets, further streamlining the short-term business mobility system, and shoring up the UK’s position as an attractive destination for inward investment. 

Miles Celic, Chief Executive Officer, TheCityUK said, “With the Financial Services & Market Act now in force, the stage is set for the government to articulate and accelerate the next phase of reforms to boost the UK’s growth and competitiveness and reinforce its position as a world-class international financial centre. 

“Current rules are restricting the inflow of talent and innovation, the appeal of UK equities and the ability to remain attractive to domestic and international investors. Reforms across these areas are crucial for the UK’s growth and our ability to remain competitive on the global stage. These reforms will ensure the financial and related professional services industry can continue to facilitate job creation and economic growth right across the country.” 

TheCityUK’s calls for the Chancellor include the following: 

Reform to revive UK capital markets 

To achieve long-term economic growth, the UK must increase levels of public equity investment. This will not only provide capital to invest in growing UK businesses and jobs, but also support better long-term pension and investment savings outcomes for people across the country. This is crucial for strengthening the nation’s economic resilience and advancing the net-zero transition.    

Reforms should focus on: 

  • Establishing a single point of engagement for companies considering listing on UK exchanges to help them through the process. 
  • Retooling growth exchanges so they can access the data, research and liquidity they need to support growth companies transition smoothly between markets.
  • Improving incentives for institutional and pension scheme investment in UK public equities.
  • Reducing disincentives to invest in listed equities.  

Reform to strengthen the UK’s short-term mobility system 

Refining the short-term business mobility system to enable companies to support overseas employees to enter the country for short-term productive activity without the need for a work visa will ensure the UK can benefit from the best and brightest talent. This is essential for the UK to remain a global hub for industry expertise and to ensure it continues to develop leading-edge innovative products and services.  

Reforms should focus on:  

  • Removing visa frictions to short-term business mobility. 
  • Providing legal certainty to firms by explicitly setting out all permitted business activities (a ‘positive’ list) to reduce ambiguity. 

Boost international trade in services and drive investment attraction 

To reaffirm the UK’s position as the leading global hub for investment, boost trade in services, and be at the cutting edge of tech and green innovations, the UK’s trade policy and investment attraction strategy must be future proofed by reflecting both well-established and evolving investment priorities and trends.

This includes focusing on: 

  • Engaging with industry on the form, timing and depth of screening controls for outbound investment to avoid unintended consequences, especially for key sectors like green finance and risk management.
  • Supporting Ukraine’s long-term reconstruction and financial sector recovery. 
  • Unlocking the value of the UK-Switzerland Mutual Recognition Agreement (MRA) by ensuring early conclusion of the UK-Switzerland free trade agreement (FTA) negotiations.
  • Promoting the free flow of data globally upon which the industry depends, including by advocating against EU cloud sovereignty proposals that restrict cloud service providers and supporting the World Trade Organisation moratorium on applying customs duties to electronic transmissions. 

Other calls set out in TheCityUK’s submission to the Autumn Statement include: 

  • Responding to the challenges created by the US Inflation Reduction Act and creating long-term policy, certainty and nurturing competitive advantage to drive the net-zero transition.
  • Deepening devolution to drive regional growth and export performance.
  • Creating a competitive tax system by providing greater certainty, predictability and stability.