UK Markets closed

David Davis seeks to reassure City on transfer of workers after Brexit

Heather Stewart
David Davis: ‘We want to ensure that our new partnership with the EU protects the mobility of workers and professionals across the continent.’ Photograph: Peter Nicholls/Reuters

Global banks should be able to continue to transfer workers between the UK and EU member states after Brexit, David Davis has told an audience of City workers.

In an emollient private speech at the London headquarters of Swiss bank UBS on Tuesday, the Brexit secretary sought to reassure financial institutions that the government hopes to negotiate a deal with Brussels that would allow City firms to move senior staff in and out of the UK.

“We want to ensure that our new partnership with the EU protects the mobility of workers and professionals across the continent. Whether this means a bank temporarily moving a worker to an office in Germany or a lawyer visiting a client in Paris, we believe it is in the interests of both sides to see this continue,” Davis said.

That approach would contrast with the tough new rules on lower-skilled workers mooted in a draft of the government’s immigration white paper leaked to the Guardian earlier this year.

The future of so-called “intra-company transfers”, which allow firms to shift senior workers between EU countries, has been one of the concerns raised by business lobby groups as Brexit looms.

Several EU member states including France are keen to tempt global financial institutions to transfer jobs out of London. But Davis stressed that protecting the future of the City – Europe’s dominant financial sector – is in the EU’s interests as well as Britain’s.

“For Europe, London is a gateway to global financial markets. This isn’t just the City of London, it’s the first city of Europe, the primary financial centre for this continent,” he said. “It would simply not be possible to recreate, or duplicate, another leading financial centre in Europe.”

Davis also stressed that the government hopes to continue cooperating closely with the EU on financial stability and other aspects of financial regulation.

“Cooperation arrangements should be reciprocal, reliable and prioritise financial stability. These arrangements should also be durable so that businesses know what their regulatory obligations are going to be – not only next week, but next year and beyond,” he said.

Such a durable arrangement would undermine the hopes of those Brexiters who would like to see the UK radically deregulate the financial sector after leaving the EU.

The chancellor, Philip Hammond, has repeatedly championed the importance of the City, but Davis’s speech suggested the government is on a concerted charm offensive to win over sceptics in the financial sector.

Several high-profile City employers, including Bank of America Merrill Lynch and Goldman Sachs, have suggested they are poised to move jobs to Dublin, Frankfurt or elsewhere in the European Union as they prepare for a post-Brexit future.

Negotiations in Brussels ended last week with little progress on the withdrawal issues the EU has insisted must be tackled before talks can move on to the future relationship between the UK and the EU – something the Department for Exiting the European Union now hopes will happen in December.