The government plans to safeguard London’s position as the world’s leading financial centre after Brexit by signing a series of financial partnerships with non-EU countries.
Philip Hammond will use his keynote Mansion House to the City’s elite on Thursday to say that the government intends to strike deals outside of the single market that will make the UK a gateway to financial markets.
The chancellor will also call on the EU to negotiate a wide-ranging post-Brexit financial services deal that would provide access to EU markets for UK firms and allow EU governments and companies to borrow money cheaply in London.
The chancellor’s insistence that London can be the gateway to global financial markets will be aimed at reassuring the City that London will continue to thrive after Brexit.
“Connectivity was always at the heart of London’s success. And to succeed in the future, we must remain connected to the world – including the important emerging markets,” Hammond will say.
The chancellor’s proposal involves bringing together governments, regulators and industry to build a system for opening up cross-border financial services, with the aim of improving access to global financial markets and reducing business costs.
Britain has already started a series of financial dialogues with leading emerging market countries, such as China and Brazil, and these will form the basis of new partnerships.
In the Mansion House speech, the chancellor will also emphasise that the government will stick to its plans for eliminating the budget deficit and reducing the UK’s debt despite this week’s pledge to spend more on the NHS.
Making it clear that taxes will be raised in this autumn’s budget, Hammond will say: “We are getting debt down, while investing in Britain’s infrastructure, supporting our vital public services and helping hard working families, across the United Kingdom.
“This week the prime minister announced a five-year NHS funding package that will boost spending on health by over £20bn a year in real terms in England alone. So, as the prime minister said, across the nation taxpayers will have to contribute a bit more in a fair and balanced way to support the NHS we all use.”