Newspaper article The Evening Standard (London, England)

Reform Must Not Kill City's Golden Goose

Newspaper article The Evening Standard (London, England)

Reform Must Not Kill City's Golden Goose

Article excerpt

GEORGE Osborne's first Mansion House speech this evening may in its way be as significant as that of Gordon Brown back in 1997. Mr Osborne came to office distrusted by many in the City, something that his confident performance to date has already done much to remedy. But his plans for regulatory reform could set him on a collision course with the financial sector once more.

The most immediate pain to come from Mr Osborne's plans is his planned levy on the profits of major banks, essentially a penalty for the damage they inflicted on the UK economy. The levy that he proposed in opposition would raise around [pounds sterling]1 billion, although Business Secretary Vince Cable favours a heavier one. The US government has imposed a similar one-off tax, but the danger is still that such a punitive measure will be seen in the City as a sign of hostility from government. It will also make little dent in the deficit.

More serious in the longer term are planned regulatory changes. …

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