Anstee: Government needs to support financial sector

THE MAN regarded as the ambassador for the UK’s financial services industry has told TheBusinessDesk.com that he supports the Chancellor’s aim to reduce the economy’s dependence on the sector – but warns that government policy was prompting overseas investors to ask if the City was still open for business.

Nick Anstee, Lord Mayor of the City of London was speaking on a visit to Birmingham when he met members of Birmingham Forward and visited the new financial services faculty at Birmingham Metropolitan College. His role is traditionally seen as one which represents the interests of City firms and institutions, and is a key link between the sector and government.

Chancellor George Osborne has promised to deliver “an economy not overly reliant on the success of one industry, financial services – important as they are – but where all industries grow.”

Mr Anstee said: “That’s the right aspiration. The government are trying to reduce the dependency on one sector – not to reduce the size of the industry. We need to be building up other industries around it. My point is that in order to achieve that objective, the UK needs financial institutions to be there funding new industries.”

Mr Anstee stepped into the role last year, just as the banks and other institutions found themselves in the eye of a storm, blamed from all sides as the financial crisis engulfed the UK economy.

Mr Anstee said: “if ever there was a time to get engaged in some serious challenges, then it’s now.”

“That’s not only from a domestic standpoint where the foreign banks in the UK are crying out on issues of regulation and fiscal policies that are being pursued by governments which are against the interests of the financial services community.

“When I went to Japan, the COO of Nomura made it absolutely clear that it these issues that concern him most when it comes to continuing to build operations in the UK.

“Until regulation and fiscal policy have an air of stability and clarity about then he’ll be building no new business in this country.

“We’ve got to defend something which is great because people just can’t believe the way that our government has behaved towards us as an industry. When you travel overseas they ask if the City is open for business. They cannot believe we are not more friendly towards the industry.

“I don’t have a problem with regulation and neither do the banks, but I wonder why the natural default is to create reams of regulation and regiments of regulators. It’s not necessary – there are other ways and we’ve got to let management manage.

“The industry is ready for change but there needs to be a degree of pragmatism by those who have the authority to impose change.”

Jackie Hendley, pictured left, chair of Birmingham Forward and tax partner at KPMG, said: “It is worrying that the Lord Mayor has experienced reticence on the part of foreign investors who do not currently see the UK as a stable or viable business growth option.  We need to make it clear that the UK – and not just the City of London – is well and truly open for and ready for business.  In Birmingham, we’ve already made a start with four trade missions to Chicago, Shanghai, Bahrain and India in the last two years. 

“The Birmingham Forward Ambassadors programme is now gearing up for a new phase of activity and we will be collaborating with organisations such as West Midlands Knowledge, Marketing Birmingham, Colmore Business District, the Chamber of Commerce and others to jointly achieve maximum benefits from inward investment in the city and the promotion of Birmingham nationally and internationally.

“The business and professional services community in Birmingham is not adverse to sensible and consistent regulation which is designed to improve operations for everyone.  We just need to ensure that the regulation is proportionate to the risks and is being done for the right reasons, and not a kneejerk reaction to the economic situation of the last two years.”