ACCA has called for a clear plan, continued access to the free market and preserving existing passporting arrangements for the financial services industry to be the aide memoir sat on the top of Theresa May’s initial briefing pack as prime minister.
Anthony Walters, head of policy at ACCA said: “In the fallout from the EU referendum, continued uncertainty risks paralysing business decisions and knocking consumer confidence. It is fair to say that this has been exacerbated by a lack of clear leadership in Government which has left many of those running businesses – and indeed investing in them – feeling uneasy.”
According to ACCA, the priority for the new PM should be setting out a clear vision and bringing some much needed certainty.
“Our members believe the first priority for the incoming prime minister should be a plan for how and when the UK will renegotiate its new relationship with Europe. The message from the finance sector is clear – strategic direction from government is critical in providing at least some certainty to UK businesses and households,” Walters said.
“It is vital that the new leadership is able to present a clear plan of action and do so quickly.”
ACCA is also keen to reinforce just how important continued access to the single market is for the UK’s future prospects.
“Our members see continued access to the single market as critical to the UK’s future economic prosperity. The PM’s early negotiations with the EU will therefore be watched closely by businesses and investors who will be looking for early signs of which direction the UK is likely to head in,” said Walters.
“If it is made clear that continued access to the single market is both desired and achievable, then that is likely to boost business confidence, whereas any wavering toward a split can only add to the uncertainty. If access to the single market begins to look like it might be restricted, the prime minister and her cabinet will need to work fast to assure all that there is a clear Plan-B and that such a plan is achievable.”
Along with setting out a high level plan, ACCA believes that preserving access to the financial passport for UK financial services is crucial.
“The loss of existing passporting arrangements for financial services operating across the EU would be a massive blow for the UK economy. Financial services employ huge numbers of people across the UK and as a sector is a significant contributor to UK GDP. The loss of passporting would make the UK a much less attractive destination for financial services which, in the worst case, could lead to an exodus of jobs and investment to other EU destinations,” the institute said.
Walters also outlined the potential opportunities identified by ACCA members as the UK begins to extricate itself from the EU.
“While the stakes are incredibly high there are some potential opportunities in the fallout from Brexit. The UK is a net importer of EU goods and so by default remains a crucial trading partner for many remaining member states. Through careful negotiations the UK needs to play this to its advantage in order to strike a new UK-EU trade deal that works in both the UK’s and EU’s best interests,” he said.
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