On Friday morning in Edinburgh, Chancellor Jeremy Hunt announced a series of sweeping reforms to financial regulations.
The reforms are being sold as a Brexit benefit, but with previously London-based firms shipping finance jobs to Paris, Amsterdam, and elsewhere after Brexit, some have suggested it’s a desperate "race to the bottom" to avoid a further exodus.
Critics have also cautioned that removing a number of safeguards put in place after the 2008 financial crisis and resultant recession could result in a similar disaster. The post-2008 protections set to be repealed include a mandate for banks to ‘ring fence’ customer deposits by separating those operations from riskier investment ventures.
Hunt’s reforms will also scrap rules which mean financial bosses can be held responsible for mistakes they oversee. Opponents to the plans, including shadow City minister Tulip Siddiq and Finance Innovation Lab CEO Jesse Griffiths, have charged that these reforms could lead to a repeat of 2008’s financial meltdown and criticised the Chancellor for taking aim at “essential protections.”
Naomi Smith, Chief Executive of Best for Britain, said,
“After hammering SMEs and consumers with their botched Brexit and having mismanaged the country into even worse economic decline, today’s announcement makes clear that the Government’s plan for ‘growth’ is in fact a race to the bottom, where protections for the rest of us are scrapped while a super minority of incredibly rich people are made even richer."