London Recharged
HOW REGULATION CAN RECHARGE LONDON
The COVID-19 pandemic continues to damage lives and hamper economies. In these difficult times, how the UK recovers from the pandemic and whether it can stay relevant on the global stage will depend heavily on the performance of its capital, London.
To look at what will drive London’s success, Oliver Wyman recently worked with the City of London Corporation on “London Recharged”. This report puts forward how the city can become the pre-eminent sustainable, global hub for businesses, and collaborate with other cities across the UK to benefit the whole, in line with the government’s ‘Levelling Up’ agenda.
We identified several ways in which regulation and public policy could help steer and deliver these ambitions. The national reach regulation has will benefit not just London but also the growing centres of excellence elsewhere in the country. These include Edinburgh in banking and asset management, Manchester in insurance, Bristol in wealth management, plus other cities with high levels of tech investment like Oxford and Cambridge.
London Will Both Learn From Other Cities And Lead The Way
We already have an ambitious growth agenda from the government, predicated on innovation, climate resilience and support for new start-ups and scale-ups. For more established businesses and sectors, government support will further build and maintain their leadership positions.
Regulation can help with this, particularly in financial services and tech space. UK regulation supports financial services businesses by being robust and innovation friendly. One initiative, the Financial Conduct Authority’s Regulatory Sandbox, has so far supported 118 organisations to test innovations with customers and provided additional support to over 500 businesses.
However, there is scope for improvement, particularly where the digitalisation of financial services and technology innovation converge. We should look to streamline regulatory requirements across these areas to reduce costs, drive further competition and innovation, and ensure UK customers and the economy are protected.
Another way to draw business and investment into the UK is by making our stock exchanges as attractive as possible for equity listings. With London determined to stay a world leader in the tech sector (the Tech Nation Report 2020 found London’s ecosystem for tech start-ups is second only to Silicon Valley) every effort should be made to encourage companies in this space to float on our local exchanges.
Then, as more businesses and people identify London and the UK as destinations to invest and work, we should look at how to make it simpler for skilled workers and talented people to enter the UK. Suggestions on how migration policy might be updated have been set out by The City of London and TheCityUK and could include removing the cap on Tier 2 (general) visas for EU citizens.
In This Together
Many of the regulatory changes outlined in “London Recharged” are ambitious and it will be challenging to achieve them all. London is prepared to step up to lead these changes, to bring together the right people to harness ideas from all over the UK that will benefit us all.
The City of London Corporation, Oliver Wyman, and the Oliver Wyman Forum are committed to helping foster the partnerships, investment, and conditions for success that are needed to ensure London’s future as the international platform for innovation and collaboration.
By working together and delivering on the recommendations in this report, we believe that we can rebuild from the current pandemic to create a city and country that are even more inclusive, even more innovative, and even more sustainable.