The Treasury select committee has started an inquiry into the UK’s future financial relationship with the European Union, as chairman Andrew Tyrie calls for a delay in triggering Article 50.
Further evidence will be taken by the committee looking at the economic relationships which the UK might now seek with the EU before parliament breaks for the summer on 21 July.
The inquiry will include the trade-offs between market access and controls, and will focus on the practical consequences for both people and businesses.
Treasury select committee chairman Andrew Tyrie said Article 50 should not be invoked until the UK’s position for negotiating with the EU has been established, despite members of the European parliament urging the UK to begin separating itself from the EU immediately.
Article 50 is a clause in the Lisbon Treaty, which - once triggered - gives a country two years to work out the terms of its withdrawal.
Mr Tyrie said: “A crucial task is to identify the maximum level of EU market access, consistent with the need for some control on migration,” adding work must also be done to identify the opportunities, as well as the risks, of leaving.
The committee’s first hearing, which look place yesterday (29 June), took evidence from former cabinet secretary Lord Turnbull, professor David Miles at the Imperial College London and HSBC senior economic adviser Stephen King.
Dan Farrow, director of SBN Wealth Management, said: “We should interpret this call for a delay in triggering Article 50 as meaning we don’t have a team to do something which has not yet been considered.
“Article 50 should be triggered by the end of the year because it will be an important precedent for not only the UK, but the rest of the countries that will be seriously considering leaving, such as Greece and Spain.
“Insurance companies will be wanting to get the financial services passport situation clarified, but from an IFA’s perspective, let us hope the Financial Conduct Authority use it as an excuse to slim down the rulebook and help us to provide clear and unambiguous advice.”
Following the Brexit vote, the Financial Conduct Authority reminded firms the result has not led to any regulatory changes.
The FCA stated: “Much financial regulation currently applicable in the UK derives from EU legislation. This regulation will remain applicable until any changes are made, which will be a matter for government and Parliament.
“Firms must continue to abide by their obligations under UK law, including those derived from EU law and continue with implementation plans for legislation that is still to come into effect.
“Consumers’ rights and protections, including any derived from EU legislation, are unaffected by the result of the referendum and will remain unchanged unless and until the Government changes the applicable legislation.”