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Services: EU Relationship

Volume 687: debated on Thursday 14 January 2021

What discussions she plans to have with her EU counterparts on developing the relationship on services. (910770)

The trade co-operation agreement secures continued market access across key service sectors, including both professional and business services. The agreement also includes a commitment to review the services provisions with a view to making further improvements, along with a specific joint declaration on regulatory co-operation in financial services. Specifics will be taken forward by the Cabinet Office and Taskforce Europe.

Within a day of leaving the EU, shares worth billions of euros normally traded in the City of London flooded out of the EU to other European capitals such as Paris and Amsterdam. One trader told the Financial Times that this was a “stunning own goal” and only the beginning of the financial sector’s post-Brexit decline. We know that in Scotland seafood markets are already being decimated, but what is the Minister’s assessment of the damage Brexit will do to the UK’s financial sector and how many own goals can we expect in the future?

The memorandum of understanding on financial services ensures financial stability and consumer protection, and we look forward to that being negotiated. I was not surprised by this question, but I was a little bit surprised that the hon. Gentleman was the one asking it. It is not that long ago that he said:

“Leaving the European Union without a deal in place is an act of economic self-harm”.

But that is precisely what he voted for on 30 December.

The Prime Minister admitted that the deal is not up to the job on trade and services, and Brussels has made it clear that access will be restricted further if there is divergence from the EU’s standards. Is it the Government’s intention to give up access to that market, or will the UK remain wedded to the EU’s regulatory framework?

I have long experience in this space, having been a Treasury Minister, and there are of course advantages to the UK being able to set its own regulatory regime for financial services as the biggest financial services marketplace in Europe. I think the hon. Lady is wrong to characterise the treaty—she voted in favour of no deal—as not being good for services. There are good provisions on business travellers, excellent provisions on legal services, and very, very good provisions on digital and data. I am a little bit surprised that she is not more supportive of the deal.