July 16, 2025 • 18 mins
Chancellor Rachel Reeves delivered the annual Mansion House speech to the key players in London’s financial sector this week. Bloomberg’s City Editor Katherine Griffiths joins host Francine Lacqua to discuss how the City reacted to the Chancellor's announcements, particularly reforms to ring-fencing rules.
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Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, radio News. Welcome to the City
of London, the City of the City, the City of London,
the Bank, please mind the gap between the and the
(00:22):
financial hearts of the country.
Speaker 2 (00:29):
The City, the City. Welcome to in the.
Speaker 3 (00:31):
City, stand clear of the doors. Each week we unpack
a story that's crucial to the world's financial capitals and
Francis Lacua. Tuesday night, the Chancellor Rachel Reeves gave her
second Mansion House speak to the key players in London's
financial sector. Given annually, it's an opportunity for the Chancellor
(00:53):
to speak directly to the city and communicate their plans
for growth, financial regulation, deregulation and general direction of travel.
While joining us now in the London Studio, which is
actually just a stone's throw from Manchion Houses. Bloomberg's City
editor Katherine Griffiths. Catherine covers the UK finance and regulation
here in London and was also in attendance at the
(01:14):
speech Welcome to the City. Catherine, I'm so always so
happy to speak to you.
Speaker 2 (01:17):
I'm very happy to be here.
Speaker 3 (01:18):
You always have great color in kind of you know,
explaining some of maybe the tricky things on regulation and deregulation.
But what was the vibe like in the room.
Speaker 2 (01:28):
I thought there was a particularly strong turnout last night,
and I felt that people did that quite deliberately. So
it really is a key event in the calendar of
city folks. They don't have to wear any kind of
fancy black tie white tie anymore. They can go in
their cash lounge suits. But I felt like there were
(01:48):
really quite a lot of chief execs and chairs. They're
particularly so last night, and the vibe was very much
And obviously I'm a journalist, so you know people will
being themselves when they sort of mill around and speak
to me. But I did think people wanted to present
quite a positive and constructive image and message about the
(02:11):
Chancellor and wanted to get behind her announcements.
Speaker 3 (02:15):
This is not to lobby the chancer. Is it to
show face that actually they've had demands or is it
really to listen to what she has to say?
Speaker 2 (02:23):
So I think it's it's kind of the result of
the lobbying. So these folks, the bosses of these various
different financial services firms, all the kind of the lawyers
and the advisors have been in to see her and
the Treasury team and I think we're pretty pleased with
the content of her speech, and that is quite unusual
(02:44):
because last year's Mansion House many other of these set
piece events are a bit of a damp squib. There
isn't there much there, and there's quite a lot of
skepticism about what is there actually turning into real changes.
People definitely felt like she was announcing some big things.
They certainly had the caveat of them needing to be delivered,
(03:06):
but they felt like they actually, maybe finally might make
a difference.
Speaker 3 (03:10):
And this would it make a meaningful difference to growth
or does it make some difference to growth.
Speaker 2 (03:16):
I think it will make in the round some difference,
tending towards a bit more than some difference to growth.
But I also think there'll be people out there in
the wider world who will be a bit concerned because,
of course, the flip side of taking on more risk
is potential for their being losses and those losses ending
(03:40):
up at the door of ordinary people. And of course
that won't be the intention or the plan for this
labor government, but it is inevitable that that risk is
increasing as a result.
Speaker 3 (03:51):
So I guess some of the most significant changes or
proposals is ring fencing. How welcome was that from banks?
Speaker 2 (03:57):
Banks actually have different views about ring fencing. Some have
been definitely pushing for there to be changes for this
construction that the UK was really alone in bringing in
to sort of ring fence pots of money in the
in the sort of safe high street banking side and
leave the riskier investment banking side more to the vagaries
(04:18):
of you know what might happen to them and if
they failed, they failed kind of thing. Of course, we
haven't actually seen the regime in operation and nothing has
really it hasn't really been tested since it came into force.
Banks have spent millions and millions of pounds setting up
their ring fencing structures and some wanted to see them
(04:39):
reduced or done it done away with. Others are actually
kind of felt like, well, now they're here, maybe it's
best for them to stay. It's a bit of a
mixed view on ring fencing. I think that there probably
is a view among the banks, and of course, when
we think about the kind of audience of people sitting
there at the Mansion House last night, they have start
(05:00):
different interests and priorities. But I think there is certainly
a view among the banks and the asset managers and
those who are interested in seeing valuations of stocks rise
that more money does need to be put into stocks
and shares and riskier assets. So whether that's through pensions,
(05:20):
through people's own cash savings, it's sort of a big
chewy topic that the government has gone some way towards,
but actually stopped short of making some big changes there,
and that was because of opposition from certain parties that
it wouldn't have suited.
Speaker 3 (05:37):
Yeah, where do you see risk, you know, in the city.
Is it the banks or is it actually the private markets?
And so how much is a landscape postil changing?
Speaker 2 (05:46):
Yeah, I mean, I suppose risk is across all of
those things, private markets, given the sort of their enormous
ballooning growth. But I suppose if we think about direct
risk to consumers and you know, private mastle market risk
may well filter through to the real economy and real
people's lives and jobs. But it's interesting. One of the
(06:07):
most very very interesting things the government has said it's
going to do is make some quite big changes to
the Financial Ombudsman Service. So this was set up to
make it easier for ordinary people to make a complaint
if they feel they've been unfairly treated by their financial
services provider, and it was seen as a good idea
(06:29):
and as sort of a powerful tool for people who
couldn't really go through the courts. But it's come to
be this sort of you know, everyone loves to hate
the financial Ombudsman service, certainly in the city of London.
And I think it is undoubtedly the case out there
that when investors, especially other parts of the world that
(06:50):
are slightly removed from the UK, they do ask, well,
what's going on with the FOS. And when I say FOZZ,
I mean the Financial Onboardsman Service. How can the FOS
suddenly intervene in, say the banking market and say that
car finance in this really huge way is wrong and
it's going to cost the banks lots of money to
compensate customers. But on the other hand, I think it's
(07:13):
definitely the case that these changes that may well come
in to the FUZZ in really restricting its role and
for example, really sort of cutting the interest rate that
it will pay on compensation to people. It could have
a real effect. And critics would say banks are quite
good at, if not gaming the system, certainly being very
(07:36):
very aware of where all the limits lie. So if
you take away protections from people, it is not that
unlikely that at some point in the coming years there
will be some big consumer scandal. There won't be as
much protection protection for people, and that actually will be
a bad outcome and overall not that good for the UK.
Speaker 3 (07:57):
I guess how is the city, you know, overall responding
to Labor. I know there's been a couple of ups
and downs in terms of guilds and concerns over non
domes and taxes which is now filtering through inflation. But
was the mansienhow speech away to reset that relationship.
Speaker 2 (08:13):
Yeah, absolutely, I think that's very much the case. I
think as we as we know very well, Labor went
on its prawn cocktail circuits and really tried to schmooz people,
and then people felt very disappointed in the city with
a whole range of things, the kind of downbeat message
from Kiss Dharma that just the lack of action from
(08:34):
Rachel Reeves a pretty terrible budget in their view, and
then some sort of lack of kind of reversing of
some of those measures. So one of the big topics
for people in the city is non doms and an
expectation that Labor will have to reverse some of its
non changes, but hasn't really yet done that, so that
(08:56):
may well still be coming. But that said, the message
loud and clear is the city would much prefer Rachel
Reeves as Chancellor to anyone else they think is a
possible replacement for her from the labor benches. And we
saw that in the market reaction in Parliament when it
looked slightly dodgy for Rachel Reeves last week, and it
(09:20):
certainly is what people were talking about last night. They
want Rachel Reeves to stay in that job.
Speaker 3 (09:25):
So the other thing that's of note, especially to younger
listeners and first time buyers, is it changes to mortgage borrowing,
allowing people to borrow at a higher multiple of their
income encourage them onto the housing ladder. I mean, is
she trying to keep the city happy, was at the
same time trying to take care of their base.
Speaker 2 (09:43):
Yeah, I think she very much is trying to keep
the city happy, while sort of yeah, having measures that
for people out there in the country can actually mean something.
And yeah, so crucial for younger people to be able
to have a realistic hope of getting on the house.
Of course, we know full well that people will say, well,
(10:03):
we also need to see actual meaningful changes to planning
so that there can be building and the sort of
thorny issues of where that building can take place to
create much more housing stock.
Speaker 3 (10:16):
What do you think will be significant in the weeks
and months to come? Again? What are the city? What
is the city looking for? Again, it's execution of some
of the things that she announced, because it's all nice
and world to put it in a speech, but then
it depends on practice what happens.
Speaker 2 (10:31):
She really has actually announced this time quite a lot
of big, meaty either changes or in the large parts
areas that will be changed. So of course it will
be where those changes actually land, the actual details. So
you know, she's talked about supposedly meaningful changes to ring fencing.
You know, we don't yet know what they mean by meaningful,
(10:52):
and I think there's a distinct chance that what they
mean by meaningful could change over time. But I mean,
I do think what people in the city would like
to see and would argue, I think with some reasonableness,
is that this sort of flows of money coming into investments,
into the stock market and into growth assets, because that
(11:16):
if that can be solved. If that liquidity problem can
be solved, we really could see some revaluing of UK
assets and that could be really fundamental to the economy,
to choices of you know, where do exciting young companies
list their shares? Can we create that buzz and vibe?
Can we get more people, you know, really promising entrepreneurs
(11:38):
coming to this country? Can it?
Speaker 3 (11:41):
Catherine? Is there an understanding that you know, we could
be there? And I don't know how much weight to
put on. There's a lot of noise about non doms, right,
that you're basically not only alienating alienating some wealthy people,
but that the image of the UK that's given to
abroad is actually of a much more you know, left
wing socialists government. Then maybe they want to be perceived.
Speaker 2 (12:02):
As Yeah, I mean, I think that's true. I suppose
this is this is the kind of inherent conflict for
labor that that's undoubtedly the case, and it definitely is
the case that we hear from big British companies based
here that when they go to see their investors or
their prospective investors in other countries, they raise all these issues.
(12:23):
But obviously, on the other hand, you've got a labor
party in power, for whom their base do not like
non doms, that when they are asked, they're quite happy
with the idea that these you know, supposed kind of
rich foreigners would have to be tax for and not
be given these advantages. And so that really is a
problem for this government, overlaid by the just the fiscal
(12:46):
reality being so tough. I think there's sort of a view.
I think that, for example, one thing they might do
is introduce, you know, whether it might be called an
entrepreneur's visa or an investor's visa, So they they keep
the non dom rules, but they introduce some kind of
attractive thing that has a more positive message. So it
(13:08):
might not enrage the base, but if you know, effectively
would unravel some of those damaging measures for non doms.
Speaker 3 (13:16):
Why is the chance for us so liked actually by
the financial community. I mean, she's been absolutely unmovable when
it comes to like physical constraints.
Speaker 2 (13:25):
Yes, I think they like her because they perceive her
to be on the moderate writer side of the labor
party with Kiss Starmer, and probably to the right of
Kiss Starmer, and they perceive her to understand how important
it is to maintain physical discipline. They see that she's
(13:46):
taking pain for that. I don't think they actually particularly
think she's the most kind of inspired and you know,
to be remembered in history, Chancellor. But I think they
have faith that if she is a able to implement
the measures she would like to will, they will create
more opportunity for growth and investment.
Speaker 3 (14:09):
Are they worried about where she finds the money after
the U turn on welfare and benefits.
Speaker 2 (14:13):
I think they are worried about that. I think that
there'll be lots and lots of speculation ahead of the budget.
I think they know when people were talking last night
a little bit about how you can't rule out a
wealth tax. I don't think they think it's at all likely,
and I think they take the view that Rachel Reeves
(14:33):
and the treasure we do not want it. So it's
of course then you know about how she gets buffeted
by other people in the party. I think they definitely
know there's a chance of a one off possibly bank tax.
Of course they're going to be against that, but I
think they would be more pro a one off bank
tax than some other measures. I think it's quite likely
(14:54):
that say some of the big banking bosses would take
a one off bank tax. If they get these reforms
through in a meaningful way, that changes the structure because it.
Speaker 3 (15:05):
Kind of offsets, right, the risk taking our sets maybe
some of the money that they'd pay into the coffers.
Speaker 2 (15:10):
Yes, and I think they'd be able to crucially sell
that message to their investors too that well, you can
see the state of the British economy. This is actually
a chancellor who believes in taking tough measures. Of course,
we hate the idea of bank tax, but you know
we are in fact a very profitable sector, which, by
the way, investors, that's good for you, but look at
all the ways in which the actual the structure and
(15:32):
the policies have changed, and that's going to be good
for the long term in their view.
Speaker 3 (15:36):
Was there anything else under the reader in terms of
announcements at Mansion House that stuck out to you as
being significant but maybe under reporting.
Speaker 2 (15:44):
I think one thing that's really interesting is that on
the top table you have, of course, Rachel Reeves, you've
got all these you know, big cheeses from finance, but
then you know you've got the heads of the regulators
sitting there. You've got some woods from the prudential regulation.
You've got nicol Rassi from the Financial Conduct Authority, and
(16:05):
they're both of them actually are seen to be very
very smart and effective people, but they are also people
who have implemented these much tougher regimes. And they would
say they are doing the bidding of politicians, and you know,
they're doing what they believe to be right, but they
are It's not their jobs to set the rules there,
it's their jobs to implement the rules. But obviously this
(16:29):
change of direction requires a very significant change for both
of them, and it does come down to personalities a bit.
Both of them have come under quite a lot of
scrutiny over whether they would be keeping their jobs and
what the future holds well. Sam Would's term is up
next year twenty twenty six. Sam has certainly personally been
(16:50):
very very associated with some of these tougher measures. He
was very involved in creating the reforms after the financial crisis.
He's a good public servant. He will, no doubt say
this is the change of wind, change of direction by
the government. But I do think it will be very
interesting to watch who they choose to put into those
(17:11):
roles after the incumbent. So who will this Labor Government
see as an appropriate person to lead the Prudential Regulation
Authority after Sam. It could be quite an interesting choice.
Speaker 3 (17:22):
So gathering after the Mansion House beach, what's next for
the City of London.
Speaker 2 (17:26):
It's looking at what will come with the budgets. It's
looking at whether the government will have to reverse some
of its promises on no tax rises in certain key areas,
and it is looking at whether we've obviously seen several
big U turns on policies already. I think the city
will be very focused on whether she does shift on
non doms.
Speaker 3 (17:47):
Yatherine, thank you so much, Thank you Fran very much.
Thanks for listening to this week's In the City from Bloomberg.
This episode was hosted by me Laqua was produced by
Somersadi Mosses and dam and tala Ahmadi. Special thanks to
Catherine Griffiths. Please subscribe, rate, and review wherever you listen
(18:09):
to podcasts.
Bloomberg Audio Studios, Podcasts, radio News. Welcome to the City
of London, the City of the City, the City of London,
the Bank, please mind the gap between the and the
(00:22):
financial hearts of the country.
Speaker 2 (00:29):
The City, the City. Welcome to in the.
Speaker 3 (00:31):
City, stand clear of the doors. Each week we unpack
a story that's crucial to the world's financial capitals and
Francis Lacua. Tuesday night, the Chancellor Rachel Reeves gave her
second Mansion House speak to the key players in London's
financial sector. Given annually, it's an opportunity for the Chancellor
(00:53):
to speak directly to the city and communicate their plans
for growth, financial regulation, deregulation and general direction of travel.
While joining us now in the London Studio, which is
actually just a stone's throw from Manchion Houses. Bloomberg's City
editor Katherine Griffiths. Catherine covers the UK finance and regulation
here in London and was also in attendance at the
(01:14):
speech Welcome to the City. Catherine, I'm so always so
happy to speak to you.
Speaker 2 (01:17):
I'm very happy to be here.
Speaker 3 (01:18):
You always have great color in kind of you know,
explaining some of maybe the tricky things on regulation and deregulation.
But what was the vibe like in the room.
Speaker 2 (01:28):
I thought there was a particularly strong turnout last night,
and I felt that people did that quite deliberately. So
it really is a key event in the calendar of
city folks. They don't have to wear any kind of
fancy black tie white tie anymore. They can go in
their cash lounge suits. But I felt like there were
(01:48):
really quite a lot of chief execs and chairs. They're
particularly so last night, and the vibe was very much
And obviously I'm a journalist, so you know people will
being themselves when they sort of mill around and speak
to me. But I did think people wanted to present
quite a positive and constructive image and message about the
(02:11):
Chancellor and wanted to get behind her announcements.
Speaker 3 (02:15):
This is not to lobby the chancer. Is it to
show face that actually they've had demands or is it
really to listen to what she has to say?
Speaker 2 (02:23):
So I think it's it's kind of the result of
the lobbying. So these folks, the bosses of these various
different financial services firms, all the kind of the lawyers
and the advisors have been in to see her and
the Treasury team and I think we're pretty pleased with
the content of her speech, and that is quite unusual
(02:44):
because last year's Mansion House many other of these set
piece events are a bit of a damp squib. There
isn't there much there, and there's quite a lot of
skepticism about what is there actually turning into real changes.
People definitely felt like she was announcing some big things.
They certainly had the caveat of them needing to be delivered,
(03:06):
but they felt like they actually, maybe finally might make
a difference.
Speaker 3 (03:10):
And this would it make a meaningful difference to growth
or does it make some difference to growth.
Speaker 2 (03:16):
I think it will make in the round some difference,
tending towards a bit more than some difference to growth.
But I also think there'll be people out there in
the wider world who will be a bit concerned because,
of course, the flip side of taking on more risk
is potential for their being losses and those losses ending
(03:40):
up at the door of ordinary people. And of course
that won't be the intention or the plan for this
labor government, but it is inevitable that that risk is
increasing as a result.
Speaker 3 (03:51):
So I guess some of the most significant changes or
proposals is ring fencing. How welcome was that from banks?
Speaker 2 (03:57):
Banks actually have different views about ring fencing. Some have
been definitely pushing for there to be changes for this
construction that the UK was really alone in bringing in
to sort of ring fence pots of money in the
in the sort of safe high street banking side and
leave the riskier investment banking side more to the vagaries
(04:18):
of you know what might happen to them and if
they failed, they failed kind of thing. Of course, we
haven't actually seen the regime in operation and nothing has
really it hasn't really been tested since it came into force.
Banks have spent millions and millions of pounds setting up
their ring fencing structures and some wanted to see them
(04:39):
reduced or done it done away with. Others are actually
kind of felt like, well, now they're here, maybe it's
best for them to stay. It's a bit of a
mixed view on ring fencing. I think that there probably
is a view among the banks, and of course, when
we think about the kind of audience of people sitting
there at the Mansion House last night, they have start
(05:00):
different interests and priorities. But I think there is certainly
a view among the banks and the asset managers and
those who are interested in seeing valuations of stocks rise
that more money does need to be put into stocks
and shares and riskier assets. So whether that's through pensions,
(05:20):
through people's own cash savings, it's sort of a big
chewy topic that the government has gone some way towards,
but actually stopped short of making some big changes there,
and that was because of opposition from certain parties that
it wouldn't have suited.
Speaker 3 (05:37):
Yeah, where do you see risk, you know, in the city.
Is it the banks or is it actually the private markets?
And so how much is a landscape postil changing?
Speaker 2 (05:46):
Yeah, I mean, I suppose risk is across all of
those things, private markets, given the sort of their enormous
ballooning growth. But I suppose if we think about direct
risk to consumers and you know, private mastle market risk
may well filter through to the real economy and real
people's lives and jobs. But it's interesting. One of the
(06:07):
most very very interesting things the government has said it's
going to do is make some quite big changes to
the Financial Ombudsman Service. So this was set up to
make it easier for ordinary people to make a complaint
if they feel they've been unfairly treated by their financial
services provider, and it was seen as a good idea
(06:29):
and as sort of a powerful tool for people who
couldn't really go through the courts. But it's come to
be this sort of you know, everyone loves to hate
the financial Ombudsman service, certainly in the city of London.
And I think it is undoubtedly the case out there
that when investors, especially other parts of the world that
(06:50):
are slightly removed from the UK, they do ask, well,
what's going on with the FOS. And when I say FOZZ,
I mean the Financial Onboardsman Service. How can the FOS
suddenly intervene in, say the banking market and say that
car finance in this really huge way is wrong and
it's going to cost the banks lots of money to
compensate customers. But on the other hand, I think it's
(07:13):
definitely the case that these changes that may well come
in to the FUZZ in really restricting its role and
for example, really sort of cutting the interest rate that
it will pay on compensation to people. It could have
a real effect. And critics would say banks are quite
good at, if not gaming the system, certainly being very
(07:36):
very aware of where all the limits lie. So if
you take away protections from people, it is not that
unlikely that at some point in the coming years there
will be some big consumer scandal. There won't be as
much protection protection for people, and that actually will be
a bad outcome and overall not that good for the UK.
Speaker 3 (07:57):
I guess how is the city, you know, overall responding
to Labor. I know there's been a couple of ups
and downs in terms of guilds and concerns over non
domes and taxes which is now filtering through inflation. But
was the mansienhow speech away to reset that relationship.
Speaker 2 (08:13):
Yeah, absolutely, I think that's very much the case. I
think as we as we know very well, Labor went
on its prawn cocktail circuits and really tried to schmooz people,
and then people felt very disappointed in the city with
a whole range of things, the kind of downbeat message
from Kiss Dharma that just the lack of action from
(08:34):
Rachel Reeves a pretty terrible budget in their view, and
then some sort of lack of kind of reversing of
some of those measures. So one of the big topics
for people in the city is non doms and an
expectation that Labor will have to reverse some of its
non changes, but hasn't really yet done that, so that
(08:56):
may well still be coming. But that said, the message
loud and clear is the city would much prefer Rachel
Reeves as Chancellor to anyone else they think is a
possible replacement for her from the labor benches. And we
saw that in the market reaction in Parliament when it
looked slightly dodgy for Rachel Reeves last week, and it
(09:20):
certainly is what people were talking about last night. They
want Rachel Reeves to stay in that job.
Speaker 3 (09:25):
So the other thing that's of note, especially to younger
listeners and first time buyers, is it changes to mortgage borrowing,
allowing people to borrow at a higher multiple of their
income encourage them onto the housing ladder. I mean, is
she trying to keep the city happy, was at the
same time trying to take care of their base.
Speaker 2 (09:43):
Yeah, I think she very much is trying to keep
the city happy, while sort of yeah, having measures that
for people out there in the country can actually mean something.
And yeah, so crucial for younger people to be able
to have a realistic hope of getting on the house.
Of course, we know full well that people will say, well,
(10:03):
we also need to see actual meaningful changes to planning
so that there can be building and the sort of
thorny issues of where that building can take place to
create much more housing stock.
Speaker 3 (10:16):
What do you think will be significant in the weeks
and months to come? Again? What are the city? What
is the city looking for? Again, it's execution of some
of the things that she announced, because it's all nice
and world to put it in a speech, but then
it depends on practice what happens.
Speaker 2 (10:31):
She really has actually announced this time quite a lot
of big, meaty either changes or in the large parts
areas that will be changed. So of course it will
be where those changes actually land, the actual details. So
you know, she's talked about supposedly meaningful changes to ring fencing.
You know, we don't yet know what they mean by meaningful,
(10:52):
and I think there's a distinct chance that what they
mean by meaningful could change over time. But I mean,
I do think what people in the city would like
to see and would argue, I think with some reasonableness,
is that this sort of flows of money coming into investments,
into the stock market and into growth assets, because that
(11:16):
if that can be solved. If that liquidity problem can
be solved, we really could see some revaluing of UK
assets and that could be really fundamental to the economy,
to choices of you know, where do exciting young companies
list their shares? Can we create that buzz and vibe?
Can we get more people, you know, really promising entrepreneurs
(11:38):
coming to this country? Can it?
Speaker 3 (11:41):
Catherine? Is there an understanding that you know, we could
be there? And I don't know how much weight to
put on. There's a lot of noise about non doms, right,
that you're basically not only alienating alienating some wealthy people,
but that the image of the UK that's given to
abroad is actually of a much more you know, left
wing socialists government. Then maybe they want to be perceived.
Speaker 2 (12:02):
As Yeah, I mean, I think that's true. I suppose
this is this is the kind of inherent conflict for
labor that that's undoubtedly the case, and it definitely is
the case that we hear from big British companies based
here that when they go to see their investors or
their prospective investors in other countries, they raise all these issues.
(12:23):
But obviously, on the other hand, you've got a labor
party in power, for whom their base do not like
non doms, that when they are asked, they're quite happy
with the idea that these you know, supposed kind of
rich foreigners would have to be tax for and not
be given these advantages. And so that really is a
problem for this government, overlaid by the just the fiscal
(12:46):
reality being so tough. I think there's sort of a view.
I think that, for example, one thing they might do
is introduce, you know, whether it might be called an
entrepreneur's visa or an investor's visa, So they they keep
the non dom rules, but they introduce some kind of
attractive thing that has a more positive message. So it
(13:08):
might not enrage the base, but if you know, effectively
would unravel some of those damaging measures for non doms.
Speaker 3 (13:16):
Why is the chance for us so liked actually by
the financial community. I mean, she's been absolutely unmovable when
it comes to like physical constraints.
Speaker 2 (13:25):
Yes, I think they like her because they perceive her
to be on the moderate writer side of the labor
party with Kiss Starmer, and probably to the right of
Kiss Starmer, and they perceive her to understand how important
it is to maintain physical discipline. They see that she's
(13:46):
taking pain for that. I don't think they actually particularly
think she's the most kind of inspired and you know,
to be remembered in history, Chancellor. But I think they
have faith that if she is a able to implement
the measures she would like to will, they will create
more opportunity for growth and investment.
Speaker 3 (14:09):
Are they worried about where she finds the money after
the U turn on welfare and benefits.
Speaker 2 (14:13):
I think they are worried about that. I think that
there'll be lots and lots of speculation ahead of the budget.
I think they know when people were talking last night
a little bit about how you can't rule out a
wealth tax. I don't think they think it's at all likely,
and I think they take the view that Rachel Reeves
(14:33):
and the treasure we do not want it. So it's
of course then you know about how she gets buffeted
by other people in the party. I think they definitely
know there's a chance of a one off possibly bank tax.
Of course they're going to be against that, but I
think they would be more pro a one off bank
tax than some other measures. I think it's quite likely
(14:54):
that say some of the big banking bosses would take
a one off bank tax. If they get these reforms
through in a meaningful way, that changes the structure because it.
Speaker 3 (15:05):
Kind of offsets, right, the risk taking our sets maybe
some of the money that they'd pay into the coffers.
Speaker 2 (15:10):
Yes, and I think they'd be able to crucially sell
that message to their investors too that well, you can
see the state of the British economy. This is actually
a chancellor who believes in taking tough measures. Of course,
we hate the idea of bank tax, but you know
we are in fact a very profitable sector, which, by
the way, investors, that's good for you, but look at
all the ways in which the actual the structure and
(15:32):
the policies have changed, and that's going to be good
for the long term in their view.
Speaker 3 (15:36):
Was there anything else under the reader in terms of
announcements at Mansion House that stuck out to you as
being significant but maybe under reporting.
Speaker 2 (15:44):
I think one thing that's really interesting is that on
the top table you have, of course, Rachel Reeves, you've
got all these you know, big cheeses from finance, but
then you know you've got the heads of the regulators
sitting there. You've got some woods from the prudential regulation.
You've got nicol Rassi from the Financial Conduct Authority, and
(16:05):
they're both of them actually are seen to be very
very smart and effective people, but they are also people
who have implemented these much tougher regimes. And they would
say they are doing the bidding of politicians, and you know,
they're doing what they believe to be right, but they
are It's not their jobs to set the rules there,
it's their jobs to implement the rules. But obviously this
(16:29):
change of direction requires a very significant change for both
of them, and it does come down to personalities a bit.
Both of them have come under quite a lot of
scrutiny over whether they would be keeping their jobs and
what the future holds well. Sam Would's term is up
next year twenty twenty six. Sam has certainly personally been
(16:50):
very very associated with some of these tougher measures. He
was very involved in creating the reforms after the financial crisis.
He's a good public servant. He will, no doubt say
this is the change of wind, change of direction by
the government. But I do think it will be very
interesting to watch who they choose to put into those
(17:11):
roles after the incumbent. So who will this Labor Government
see as an appropriate person to lead the Prudential Regulation
Authority after Sam. It could be quite an interesting choice.
Speaker 3 (17:22):
So gathering after the Mansion House beach, what's next for
the City of London.
Speaker 2 (17:26):
It's looking at what will come with the budgets. It's
looking at whether the government will have to reverse some
of its promises on no tax rises in certain key areas,
and it is looking at whether we've obviously seen several
big U turns on policies already. I think the city
will be very focused on whether she does shift on
non doms.
Speaker 3 (17:47):
Yatherine, thank you so much, Thank you Fran very much.
Thanks for listening to this week's In the City from Bloomberg.
This episode was hosted by me Laqua was produced by
Somersadi Mosses and dam and tala Ahmadi. Special thanks to
Catherine Griffiths. Please subscribe, rate, and review wherever you listen
(18:09):
to podcasts.
Host
Francine Lacqua
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