Philip Hammond has pledged to maintain free movement for top bankers after Britain leaves the European Union.
The Chancellor of the Exchequer also told a House of Lords committee that EU policymakers would harm their own interests if they tried to use Brexit to undermine the position of London as the continent’s principal financial centre.
He insisted post-Brexit controls on free movement should “not strike fear into the heart of Japanese financial institutions”, as he responded to pleas by Tokyo to ensure EU nationals could continue to work in Britain.
Referring to the prospects of free movement control, the chancellor said: “We would use it in a sensible way [to] facilitate movement of highly skilled people between financial institutions and businesses.”
Mr Hammond’s comments came as the House of Lords EU Justice sub-committee, under the chairmanship of Baroness Kennedy of The Shaws, will hold an inquiry into the consequences of Brexit for the rights currently enjoyed in the UK by EU citizens, workers and companies.
On Tuesday (13 September) the committee will receive evidence from leading academics.
The UK’s membership of the European Union has meant British and EU citizens enjoy the right to move, work and operate throughout the bloc’s single market.
The vote in June to leave the European Union has placed great uncertainty as to the extent to which these rights will continue to operate outside of the EU.
The Lords inquiry will provide the committee with the chance to question whether the rights already exercised under EU law by UK nationals will be legally enforceable as ‘acquired’ and, therefore, still enforceable once Britain leaves the EU.
The committee will also explore the importance for safeguarding EU rights of the contents of any potential withdrawal agreement negotiated between the UK and the EU.
Earlier this week, bankers raised concerns about whether lenders will have enough time to make the changes they will need to when the UK exits the European Union.
Speaking to a House of Lords committee, Andrew Gray, UK regional financial services leader of Pricewaterhouse Coopers, said: “Two years is an unrealistic time frame to expect financial services to plan for change and make the transition.”
Anthony Browne, chief executive of the British Bankers’ Association, said: “Businesses need to be able to plan and there should be some form of transitional arrangements to enable them to plan.”
emma.hughes@ft.com
