Public cynicism a key risk for the financial sector on road to 2015 General Election
A report published today warns that a combination of factors has sharply increased political risk for the UK’s financial sector. Key risks identified by the report include:
• The influence of public cynicism about business on an unpredictable General Election;
• The possibility that Scotland votes for independence in September;
• Deep uncertainty about the UK’s future relationship with Europe;
• The impact of extensive regulatory changes which have yet to be fully implemented; and
• Rapid technological change in the sector.
The analysis by Cicero Group, commissioned by the Chartered Insurance Institute (CII), provides an overview of industry-wide risks, as well as issues specific to banking, insurance and asset management. The report will be launched to an audience of 100 executives at the CII’s headquarters in the City of London this morning.
David Thomson, Director of Policy Public Affairs at CII said: “We hope this report can be an important contribution to a grown up debate on political risks that face the financial services sector and the wider public, not just up to the next election but beyond, addressing the major long term domestic and global issues which will confront the next government, whatever its complexion.”
John Rowland, Executive Director at Cicero Group, said: “There is no doubt political risk for the financial sector is heightened. Perhaps most worryingly, the public has become deeply cynical about business and financial markets. This will have a big impact on the election campaign as there aren’t many votes in defending the financial sector. At the same time many of the assumptions about our political system are steadily being chipped away at by the independence referendum, debate about membership of the EU and the emergence of a multi-party political system. Collectively these present significant long-term political risks. They won’t be resolved by the result in the 2015 General Election, but the policy response to them might be. The financial sector should be paying close attention.”
