When Cameron claims he’ll defend London from Brussels he’s lying, says UKIP’s furious leader Nigel Farage
The UK’s biggest industry, financial services, is facing the biggest threat in its history from a new regulatory regime in Brussels that is opposed to “Anglo-Saxon” practices.
This matters because hundreds of thousands of people work in what we still call the City, even though many now are in Canary Wharf and the West End. It matters because 20 per cent of our tax revenues come from the sector.
And it matters to me because my grandfather and father were both stockbrokers and I spent 20 years on the London Metal Exchange. Indeed both of my sons are now in the City, and I want to fight to defend it.
City people generally donʼt do politics. They are too busy trying to make money. In the 1990s I was regarded as pretty eccentric by my colleagues for worrying about the future impact Brussels would have on the industry. When the prospect of a single market in financial services came on to the EU agenda, I was even told that I was wrong, as the City would benefit from better market access.
Tory MEP Theresa Villiers was appointed as the European Parliament sponsor of the new model. I argued vigorously that the resulting costs of this brave new world would outweigh any benefits. But, she assured me, the City was in favour. So began a blizzard of EU regulations that led to a massive growth in the compliance culture. Everyone moaned about it but no-one worried too much. All that has changed.
In the wake of the 2008 banking crisis, a culprit was needed, and the hedge fund industry ticked all the right boxes. When the European Parliament voted for legislation to be introduced, the Lib Dems and Labour were enthusiastic. What was not discussed was that the Tories also voted for this on a three-line-whip.
When Boris Johnson came to Brussels to defend the hedge funds, he was unaware of the duplicity of his own party, and deeply embarrassed when he was told the truth. Boris lost for words is quite a sight.
As a result of the Alternative Investment Funds directive, one in four hedge funds left London in 2010. This example shows just how serious the threat is – businesses can quickly move to more inviting locations. The English schools in Zurich are now heavily over-subscribed.
Since David Cameron became the Tory leader over half of the money raised for his party came from the City. The donors have always been told that the industry would be supported. They are being lied to.
Every week senior Tory figures are in City boardrooms telling the executives how they are standing up to Brussels, working for the best deal for Britain. Yet it was the Tories who voted, once again on a three-line-whip, for the transference of all regulatory power to three new EU agencies. The FSA is now no more than a branch office of the European Commission.
Worse still there is nothing that we, the electorate, can do to change any of this in a future general election. The latest Brussels wheeze is a financial transactions tax, or Tobin Tax. This would cost the City nearly £40bn a year. Even if George Osborne has the courage to veto it, the message should be that we are embroiled in an organisation that wishes us harm.
The City is under attack from Brussels and from others desperate to damage the financial services sector. Rowan Williams, the Archbishop of Canterbury, is the latest to voice his support for a Tobin Tax in what appears to be little more than a cynical PR exercise to get the campers off the steps of St Paul’s Cathedral.
As the Tory Party descended into civil war last week over the proposed EU referendum, Cameron sought to cheer up the troops. He declared that the City faced a threat and that he would stand up for them. This is political dishonesty on a level that makes me furious.
He cannot be allowed to get away with it. We need to take back control of our biggest industry and pursue a global future. I will make these arguments and, I suspect, few people will think me eccentric.