The Bank of England’s latest Brexit warning is Project Fear all over again

The Bank of England’s latest Brexit warning is Project Fear all over again

Yesterday, the Bank of England claimed that up to 75,000 jobs could be lost in financial services following Britain’s departure from the European Union. It’s Project Fear all over again.

Before last year’s referendum, the Bank warned that a vote to leave the EU would increase unemployment, hit economic growth and lead to a recession. What happened? Unemployment is now at its lowest in over four decades with more than 32 million people in work. GDP is up 1.5% year on year since we voted to leave the EU. And there has been no recession.

And that isn’t the only positive news: London has not only retained its position as the world’s leading financial centre but in fact extended its lead, while weekly earnings are going up and government borrowing is at its lowest September level since 2007.

What’s more, the Bank of England is contradicting what businesses are saying on the ground. A poll of more than 100 finance firms by Reuters suggested the number of job losses would be just below 10,000 in the “few years” following Brexit.

Even the Barclays CEO, Jes Staley, has said Brexit is no more complicated than setting up a holding company in America, which the bank was obliged to do in 2016. And just two days ago, HSBC and UBS bosses downgraded their estimates of how many staff they are considering moving away from the UK.

Yet even if the Bank’s latest dire forecasts were true, London would, according to yesterday’s BBC write-up, “still be by far the largest financial centre in Europe with over one million people employed in financial services… and the UK would still enjoy a healthy trade surplus in financial services with the rest of the EU worth many tens of billions of pounds.”

What’s more, there are many businesses who see great opportunities from Brexit – particularly when it comes to trade around the world. Outside the EU, we will be allowed to strike our own free trade agreements with the rest of the world, including in places such as America, New Zealand and Australia with whom we have so much in common.

Leading figures in British business – such as Sir James Dyson and Lord Wolfson, Chief Executive of Next – make the case that we should make the most of these opportunities. They know that the country as a whole can flourish.

And the City of London can flourish too. Financial services have a lot to gain from Brexit, as do the people of this country. There is a real opportunity to reform regulation and for London to be a world leader in finance.  We should talk up what we can achieve and show that our best days are yet to come.

(Photo: James Stringer)