South Scotland MSP, Joan McAlpine has warned that the re-location of the Scottish financial sector to Europe is already well underway thanks to Brexit. The SNP MSP has been hearing evidence from an Economics Professor at a meeting of the Scottish Parliament’s Culture, Tourism, Europe and External Affairs Committee which she convenes.
Professor Sarah Hall, Professor of Economic Geography, Faculty of Social Sciences, University of Nottingham told the committee hundreds of financial services companies in the UK have already begun moving staff and assets to European cities including Dublin, Paris, Frankfurt, Luxembourg and Amsterdam. She said Standard life and RBS are two Scottish firms who have already opened offices in the EU.
The moves are in response to changes in access rules which will come in to force when the UK leaves the EU in December if an extension isn’t agreed by the deadline at the end of this month.
Commenting, Ms McAlpine said,
“The evidence from Professor Hall was very worrying for the financial sector in Scotland. She told us that the main driver forcing UK financial services companies to relocate out the UK was the ending of financial passporting – under new arrangements banks simply won’t have the same access to EU markets as before.
“Professor Hall stressed that Edinburgh will be hit particularly hard because of the number of Asset Management companies based there. Concerns about additional regulatory costs for them to continue operating in the EU is forcing them to relocate.
“The committee heard that as many as 320 financial, legal and accounting firms have begun relocation of staff and assets to cities across the EU. These are alarming numbers – financial services are some of Scotland’s biggest earners.
“Professionals working in the sector have concerns too. They say they’ll have difficulties getting their qualifications recognised once the UK leaves the UK so if they want to keep operating in Europe they need to relocate.
“And it’s not just the banks and asset managers who say their futures are at risk if they don’t relocate – our committee heard evidence that film and tv companies could lose access to EU markets too under new arrangements.
“There are just days to go before the July 1st deadline to ask for an extension to the EU transition period, the UK Government need to get their act together and get one sorted so we don’t end up crashing out without a deal in December. Businesses have enough on their plates surviving the pandemic without having the added burden of Brexit.”