MAGGIE PAGANO: City is golden goose that could be fattened for all

The Treasury was smart to choose Edinburgh to launch the biggest financial sector shake-up in decades, aimed at boosting the UK economy post-Brexit.

It was just as smart to name the reform package after the city as well, making it easy to make clear that Edinburgh is Britain’s second largest financial centre.

It is too early to say whether Edinburgh’s reforms will prove to be the dynamo needed to boost the city and, more importantly, the wider economy.

They don’t go as far as the Big Bang 2.0 promised by Rishi Sunak, but there’s certainly plenty to get you started – 30 or more, ranging from proposals for a new digital currency to short-selling reforms.

While Chancellor Jeremy Hunt hailed his package as a post-Brexit boost, some rules could have been changed even if we had stayed in the EU. Ironically, we were the ones who set the gold standard for most of the rules.

More interestingly, the EU is also reviewing similar restrictions. The more obvious point is that governments around the world – including the EU – are rethinking rules introduced after the Great Financial Crash of 2008. Some are no longer appropriate and need updating.

That’s why some rules around senior managers’ stricter regime — which holds bosses personally and financially accountable for issues that arise during their watch — are being relaxed, as are foreclosure rules designed to protect retail clients by separating their deposits from riskier investment banking. . These changes make sense as they are relaxed for banks that do not have investment banking divisions.

Among the most important reforms are those to repeal and replace Solvency II – the rules governing insurers’ balance sheets. This is expected to free up more than £100bn of private funds for insurers to invest in more productive assets such as UK infrastructure. Coincidentally, the EU is also reviewing these rules.

There are much needed plans to improve London’s capital markets.

Reviewing the prospectus and listing regime is a must to keep public markets more competitive. So are the plans for a trading platform to allow private companies access to capital without full disclosure before going public.

Still, some commentators argue that Hunt is tearing up the rulebook. They say the Treasury is introducing the same kind of lighthearted regime for which they criticized Labor and exacerbated the impact of the financial crash. That would be unfair.

Regulators are being asked to judge the international competitiveness of their actions in terms of the UK economy, but not sacrifice them to high standards. There’s nothing wrong with that.

Reforms that improve access to UK capital markets should be good for the country. Financial services contribute £216 billion a year to the economy, including £76 billion in tax revenue, and the sector employs 2.3 million with 1.4 million outside London.

Like it or not, the city is still the golden goose, and one to be plucked by the rest of the country. If these changes, which favor incumbents over new entrants, are implemented, then the goose could indeed be fattened for all.

Treaty trick

One of the saddest stories of recent years was the death of Harry Dunn, killed by hit and run American Anne Sacoolas.

Despite admitting to the crime, she didn’t have to come here because of the UK’s lopsided extradition laws with the US.

As Mike Lynch, who is about to be extradited to the US for criminal charges related to the sale of his company Autonomy to Hewlett-Packard, said on the radio yesterday, the treaty is grossly unfair.

It’s one that gives a US prosecutor more power than your local bobby.

More pertinently, a treaty designed to entrap terrorists is now being used to weaponize all US interests. What a surprise.

It should be changed.

Win bonuses

The tension is too much to bear. It will be a miracle, but it seems quite possible that Gareth Southgate’s brilliant players will come close to winning against the equally magnificent French team tonight. He just needs to let his men loosen up a bit.

No wonder retailers are reporting a big spike in beer and snack sales. Let’s hope they don’t also report a run on Kleenex tissues. As the French say, merde.