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European Financial Services Proposals

Part of Oral Answers to Questions — Foreign and Commonwealth Office – in the House of Commons at 4:49 pm on 1st December 2009.

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Photo of Mark Hoban Mark Hoban Shadow Minister (Treasury) 4:49 pm, 1st December 2009

That is certainly a factor, and as the directive has proceeded through the European Parliament more and more people have recognised the widespread impact that it could have on a range of funds, whether they are used to fund the building of wind farms in Germany or mortgages in the Baltic states. The directive is wide-ranging, and people have not understood its impact. My particular criticism is that the Government caught on to that rather late in the process. Other Governments were lobbying prior to the publication of the directive earlier this year, whereas our Government seemed to be slow on the uptake. It was only once the industry got its teeth into the directive and considered its impact on London that the Government rode in behind.

We saw the same pattern arise with the appointment of Monsieur Barnier as a European Commissioner. The deal was done some time ago. The French appeared to give way and allowed Baroness Ashton to become the High Representative, but there seems to have been a quid pro quo: a Frenchman would take over as Commissioner for the internal market. The Government woke up to that quite late in the debate, and there was a flurry of spin and media activity in the days leading up to his appointment, but by that stage it was too late. Again, tactics took priority over the strategic approach that is needed to protect London's financial interests, and the same point applies to the documents that are before us today. The Government must be much more zealous in protecting Britain's interests and those of the financial services sector, which is an asset not just to London but to the wider European economy.

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