Mark Garnier

I thank the Chancellor for his speech’s very positive tone. As he so rightly said, there was a lot of collaboration in the House of Lords as our colleagues were taking through this Bill, and I certainly intend to enter the conversation in a similar spirit of collaboration over the coming weeks and months. As the Chancellor has said, the financial services sector is incredibly important to this country. It is the engine room that powers our economy. As the Chancellor has also said, it generates 8% of our national economic output, contributes £12 in every £100 of tax paid and makes up 3% of all jobs in the UK. As the Chancellor so rightly said, two thirds of those jobs are outside London. The sector truly is a jewel in our economic crown, but it is important to remember that financial services underpin our everyday lives—for example, they support my constituents in opening and running businesses. They support all our constituents across this great country to get on to the housing ladder. They support people across the UK in ways that are not truly understood, including financial support for their employer; ensuring that their homes and other assets are insured; providing liquidity to buy expensive items such as a car; and helping to provide for our retirement. What happens just a mile or so up the road and across the country helps every one of us in pretty much every aspect of our lives. Despite that, we must be careful. The UK’s financial services and related professional services sector are at a crossroads. TheCityUK published earlier this year its “No Time to Lose” report in conjunction with PwC, which I will quote directly. It said that “the hard truth is that overall industry growth has stalled over the last decade and the UK is falling behind other financial centres.” Our international competitiveness should be our priority, because the UK market is so internationally focused. As we know, London is the second-biggest financial services centre on the planet, second only to New York. However, while New York’s financial services market is 80% led by its domestic economy, here in the UK London is 80% international. At the most basic level, our international competitiveness is four times as valuable to us here as it is to the Americans across the Atlantic. The Chancellor rightly mentioned the Budget, during which he said to the banks that “I celebrate, and am grateful for, the role that you play.”—[Official Report, 28 October 2026; Vol. 792, c. 307], But then he increased the bank levy by 3%. To be fair to him, bank stocks did go up on the day, because they were expecting a 5% permanent levy. None the less, we have to bear in mind that that takes the marginal tax rate on banks to 49.5%. That is not competitive on the international stage. We need to be mindful of that, because we need to attract international banks to come to our shores, and it is very important that we get this right. We understand that that generates a little more tax, but we want more people to invest in this country, and that is why we were against that measure. It sends the wrong signal.