The CBI called this morning for a moratorium on new regulation and warned that complacency in Brussels: “Could endanger the global status of UK financial services.”
The business group claims that between 2004 and 2006, companies face the imposition of over 20 EU measures, resulting in regulation and consultation overload.
CBI Deputy Director-General, John Cridland, said: “The UK financial services industry is one of the best in the world. It’s a major contributor to UK employment, output and balance of payments, but that is at risk.
A robust regulatory environment is essential.
Internationally it’s regarded as one of the strengths of UK financial services. But companies are being battered by the impact of relentless new regulation. It’s forcing a dramatic and wasteful diversion of effort away from the daily battle to keep the UK ahead of its competitors. It’s vital that companies are given a substantial breathing space and not another onslaught.”
In a report published today, Financial Services: Promoting a Global Champion report, the CBI claims that extra regulation means that management time is diverted away from developing the business and serving customers, investment decisions are often put on hold, and that 15% of IT investment is spent on complying with new regulation and not on improving productivity or customer service. It also claims that a third of all staff training last year was about new regulation.
The report adds that voluminous regulations may dissuade global companies from locating in the UK, and that UK government responses to EC Directives display a lack of overall strategy. The government, says the report, should be taking the lead in international negotiations, and not “simply fighting rear guard actions to minimise damage from poor legislation.”
