The City of London will be "under siege" from "wave after wave" of EU regulation if the UK votes to remain in the EU, UKIP's financial affairs spokesman and former City barrister Steven Woolfe will warn today (Monday).
Mr Woolfe will be joined by Conservative MP John Redwood at a cross-party Grassroots Out event in London, in which the former City men will team up to warn of the risks posed by the EU.
Both men had lengthy and successful City careers before entering politics - and they will speak at the first significant Leave campaign event that will set out how the UK's financial services sector will thrive and prosper outside of the EU.
Introducing Mr Woolfe, John Redwood will dismiss claims that the City will lose out in the event of a Brexit, saying "we were told if we stayed out of the Euro we would lose important business from the City. The pro-EU fear mongers were wrong then and they are wrong again when they say we have to stay in."
Mr Woolfe, a barrister and former adviser to Barclays Capital, Credit Suisse and Aviva, will warn the City will be under siege if we stay in the EU.
"The renegotiation secured no reform and no guarantees for the UK's financial services sector," he will say.
"If we stay in the EU, the City will be under siege. It will have to deal with wave after wave of attacks from Brussels, but will be powerless to fight back.
"The Square Mile will be like a Medieval castle trying to repel attacks - but with its loopholes filled in, its moat drained of water and its drawbridge down and free for the foreign invader to cross at will.
“The City of London will be defenceless in the face of more and more regulation and a determination from the Eurozone to integrate using the frameworks and institutions of the entire European Union."
In his speech, Steven Woolfe will rebut a series of myths peddled by the Remain campaign in support of its false claim the City could not survive in the event of a Brexit. He will also say:
· The City is an essential part of the UK economy that has been eyed with jealousy from some in the EU and as a terrible threat needed to be brought to heel by others.
· The City has suffered under the EU. Its growth has been hampered by EU regulations, especially since 2008 when regulation shifted to EU institutions (European Securities and Markets Authority, European Banking Authority and European Insurance and Occupational Pensions Authority). In the forty years up to 2008, the annual growth rate of UK financial services was an average 12.9 per cent each year. Post-2008, it has been less than six per cent each year.
· The financial services sector could add £25 billion to London’s output and over 200,000 jobs across UK by 2020 if free of burdensome EU regulation.
· The EU has ambitions for a common corporation tax and wants to end trust fund structures that help the City of London operate.
· The EU will introduce a single European-wide financial regulator based in Frankfurt that will undermine the City of London.
· New directives will hurt the City. The Alternative Investment Fund Managers Directive 2011 costs the UK financial services sector £1.5 billion per year.
· EU directives have threatened the viability of building societies. Mr Woolfe will list a series of regulations from Brussels that undermined them.
· The City continues to suffer prejudice to its business model and legal system from the EU, which fails to understand common law or the UK’s outward looking internationalist trading mentality.
Mr Woolfe will aim both barrels at Chancellor George Osborne, who he will say has “abandoned” the City of London.
The Chancellor used his Mansion House speech in September 2015 to say ‘one of the greatest threats to the City’s competitiveness comes from misguided European legislation, so a central demand in our renegotiation will be that Europe reins in costly and damaging regulation’.
Mr Woolfe will remind the Chancellor of his words eight months ago and point to a renegotiation that failed to secure any assurances or protections for the UK’s financial services sector.
“Given the failure to secure any such change in the UK’s relationship with the EU – and the lack of any protections for our financial services sector – you’d think the Chancellor would now support a British exit.
“Alas, he seems to have quickly forgotten his own warning from September as to just how big a threat the EU poses to our world-beating City of London.”