Rishi Sunak to make statement on the future of the City TODAY amid Covid and Brexit hits to economy 

Rishi Sunak will make his first major speech on Britain’s financial services today as he seeks to position Britain for a post-Brexit and post-Coronavirus economic recovery.

The Chancellor is to address MPs in the Commons this afternoon where he is expected to set out his plans for the UK to remain a world leader of global finance.

He is also understood to be planning to set out a vision for the country to grow its green finance and financial technology (fin tech) industries.

It is the first set piece on the major industry held by the Chancellor since he took on the role in February.

It comes amid growing damage to the economy from coronavirus and concerns over leaving the EU with out a deal that would include financial service at the end of December. 

Last month furious business leaders accused officials in Brexit talks of complacency over the future of the City, while fiercely protecting Britain’s fishing rights.

With the end of the transition period looming, bosses of banks and insurance companies are worried about the failure to close in on a post-Brexit deal for the UK’s powerhouse financial services industry.

The sector employs more than one million people and contributes just over seven per cent of the UK’s entire annual economic output.

In contrast, Britain’s fishing industry accounts for just 0.1 per cent of GDP and employs around 24,000 people – but it appears to be the key sticking point in the UK’s negotiations with the EU.

Without a deal, financial companies such as banks, insurers and fund managers will lose unfettered access to EU markets and not be able to trade freely across the bloc.

With the Brexit transition period ending at 11pm on December 31, other financial centres such as Paris and Frankfurt are flexing their muscles to challenge London’s dominance.

The EU is Britain’s biggest financial services customer. Brussels has yet to say how much access the City of London will have from January under its ‘equivalence’ system, beyond temporary permission for UK derivative clearing houses.

The EU grants access for foreign financial firms if it deems their home rules to be equivalent or as robust as those in the bloc, a system Britain will also use for granting access to its financial markets from January.

Mr Sunak will set out the government’s own approach to equivalence as Britain ‘builds a global role outside the EU’, the Treasury said.  

Michel Barnier today said the EU and the UK are ‘redoubling our efforts’ to strike a post-Brexit trade deal amid signs Joe Biden’s US election win has sparked a fresh negotiating push. 

The EU’s chief negotiator said he was ‘happy to be back in London’ as he arrived for talks this morning and set out ‘three keys to unlock a deal’.

He said the autonomy of the EU and UK sovereignty had to be respected, ‘robust guarantees’ must be agreed on fair trade and competition, and there should be ‘fishing opportunities in the interest of both parties’.

His comments came after Environment Secretary George Eustice hinted at a UK move on post-Brexit fishing rights.

Mr Eustice suggested agreements setting the ‘ground rules’ on access for EU fishing fleets could cover several years – an apparent shift from the demand that negotiations happen annually. 

Boris Johnson yesterday insisted a trade pact with Brussels is ‘there to be done’ as he raised hopes of a breakthrough.

But the PM has been warned that unlike Donald Trump, Mr Biden is a supporter of the EU and has criticised Government Brexit legislation some claim risks undermining the Good Friday Agreement. 

With perhaps as little as a week left to get an agreement in time for the end of the transition period on January 1, the two sides are deadlocked on fishing rights and state aid rules.  

However, in a round of interviews this morning, Mr Eustice indicated there could be wriggle room on the Government’s fishing position.