Responsible Finance after Brexit: Recent developments and upcoming challenges Marta Costas, Senior Consultant, Political Monitoring – Financial Services July 2016 www.dodsinformation.com
Challenges of long term policy making Business climate/SMEs Financial services Personal lending / access to credit Social investment www.dodsinformation.com www.dodsinformation.com
Challenges of long term policy making Business climate/SMEs Access to capital /FDI Access to finance / R&D tax breaks Access to talent / migration Exports (goods but primarily services) Financial services Personal lending / access to credit Social investment www.dodsinformation.com www.dodsinformation.com
Challenges of long term policy making Business climate/SMEs Financial services Euro trading (LSE/DB merger) Passporting rights (HSBC/Santander warnings) Access to talent / cost of visas Political Sentiment (distributed economy) Personal lending / access to credit Social investment www.dodsinformation.com www.dodsinformation.com
Challenges of long term policy making Business climate/SMEs Financial services Personal lending / access to credit Tightening of credit (anecdotal evidence) Consumer confidence (H1 data is +ve but IMF/OECD warnings Q3) Little room for manoeuvre – real wages down since recession Social investment www.dodsinformation.com www.dodsinformation.com
Challenges of long term policy making Business climate/SMEs Financial services Personal lending / access to credit Social investment Lose access to ESF and ERDF (anecdotal evidence of discrimination) Talent and service exports for social enterprises Could fall in the list of priorities Large contingent of vulnerable startup/scaleup biz www.dodsinformation.com www.dodsinformation.com
Strategic objectives / opportunities Business climate / SME • Better deal for biz, with exceptions for SMEs? ( Leadsom’s view) • Corporation tax rates (Osborne’s proposal) • Norway Model (Liam Fox/May disagreement on single market) • London visa? (Rohan Silva) • Access to finance inquiry (BIS select Cttee) Financial services Personal Lending Social investment www.dodsinformation.com www.dodsinformation.com , UK Client Manager, Dods Monitoring
Strategic objectives / opportunities Business climate / SME Financial services Balanced economy – role for challenger banks? MPC stimuli in August – what effect on real economy? Europe likely to adopt a tough line – FR, EI, DE to benefit Personal Lending Social investment , UK Client Manager, Dods Monitoring www.dodsinformation.com www.dodsinformation.com
Strategic objectives / opportunities Business climate / SME Financial services Personal Lending Demand-driven: Biz voice to avoid self-fulfilling prophecy Wait for October for data on consumer confidence post-Brexit Negative int. rates a possibility – BoE is shifting its position Social investment , UK Client Manager, Dods Monitoring www.dodsinformation.com www.dodsinformation.com
Strategic objectives / opportunities Business climate / SME Financial services Personal Lending Social investment Could be a winner in the process – benefit from fall of vanity projects Must act with one voice – Javid and Osborne roundtables w/biz Widespread misunderstanding in Parliament – or in business P2P lending a key weakness – uncertainty even pre-Brexit www.dodsinformation.com www.dodsinformation.com , UK Client Manager, Dods Monitoring
Key actors T. May – keeps chair seat on 3 key cabinet committees Philip Hammond, Chancellor of the Exchequer Greg Clark, Secretary of State for Business, Energy and Industrial Strategy No Small Biz Minister yet The three Brexiteers: Liam Fox, Secretary of State for International Trade and President of the Board of Trade David Davis, Secretary of State for Exiting the European Union Boris Johnson, Secretary of State for Foreign & Commonwealth Office In EU: Michael Barnier, Chief Negotiator EU www.dodsinformation.com www.dodsinformation.com
Devolution Northern Ireland • Questions around border and customs with single market • Opportunities to lower corporation tax Wales • ERDF most at risk • Welsh Bill underway – devolve collection of VAT and income tax Scotland • Second referendum position weaker than expected • Spanish objection to EU membership access London • Khan pushes for Scottish-style devolution • Greater planning and tax collection powers • Access to talent and single market www.dodsinformation.com
Key dates 4 August - Monetary Policy Committee Meeting interest rate decision August - market study on competition in investment and corporate banking (Expected: Summer) 8 September – Chancellor appears before Lords Economic Affairs Cttee 16 September - European leaders - extraordinary meeting; future of post- Brexit EU discussed Autumn – resolution of access to finance inquiry Regular meetings of BoE, ECB, ECOFIN, Eurogroup www.dodsinformation.com
How to engage Political Monitoring People Data Politics Home and Central Lobby Polling and Research Training Risk Analysis NEW – Brexit Reports Publications Events www.dodsinformation.com
Questions or comments Marta Costas Senior Political Consultant, Financial Services t: 020 7593 5691 e: marta.costas@dods.co.uk t: @dodsmonitoring a: 21 Dartmouth Street | Westminster | London | SW1H 9BP w: Dods | Dods Monitoring | Dods People | PoliticsHome | Dods Research
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