Global banks set New Year dead­line for Brexit re­lo­ca­tion plans

The Daily Telegraph - Business - - Front Page - By Iain Withers and Tim Wal­lace

IN­TER­NA­TIONAL banks with op­er­a­tions in the City will de­cide early next year whether or not to move some jobs from the UK, a se­nior Trea­sury of­fi­cial has warned.

At yes­ter­day’s Trea­sury Se­lect Com­mit­tee hear­ing – where Chan­cel­lor Philip Ham­mond was grilled on the Gov­ern­ment’s pre­pared­ness for Brexit – Katharine Brad­dick, who is the fi­nan­cial ser­vices di­rec­tor gen­eral, sug­gested there was a race against time to con­vince global fi­nance firms to stay in Bri­tain. Ms Brad­dick said fi­nanciers who used Bri­tain to serve clients in the EU had the most ad­vanced re­lo­ca­tion plans.

She told MPs: “Those plans, if you like, har­den, be­come more firm, at the point at which they start to al­ter con­trac­tual pa­per­work.

“For most of the firms that we talk to, that will fall at some point in the first quar­ter of next year.”

City firms have been press­ing for a tran­si­tion pe­riod, Ms Brad­dick said, “be­cause, apart from any­thing else, what they want is to have longer to see where the deal is likely to emerge”. Mr Ham­mond de­scribed the prom­ise of a tran­si­tion deal on Brexit as a “wast­ing as­set”, say­ing its value to busi­nesses that were plan­ning for the fu­ture was fall­ing all the time.

He said: “It has value to­day, it will still have a very high value at Christ­mas and early into the New Year, but as we move through 2018 its value to every­body will di­min­ish sig­nif­i­cantly.

“I think our Euro­pean part­ners need to think very care­fully about the need for speed in or­der to pro­tect the po­ten­tial value to all of us of hav­ing an in­terim agree­ment that pro­tects our busi­nesses and our cit­i­zens and al­lows in­vest­ment in nor­mal busi­ness ac­tiv­ity, con­tract­ing and so on to carry on.” He urged the Euro­pean Union’s politi­cians to come up with a “rapid re­sponse”, and to en­gage swiftly in ne­go­ti­a­tions on a deal on new busi­ness ar­range­ments.

“It means break­ing out of the struc­ture of the ne­go­ti­a­tion that has been im­posed by the EC, and al­low­ing at least ex­ploratory dis­cus­sions around what a tran­si­tion might look like, what a fu­ture part­ner­ship agree­ment might look like,” he said.

“The only way we will set­tle the so­called ‘Phase 1’ is­sues is to set them in a broader con­text of the UK’s fu­ture re­la­tion­ship with the EU.”

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