Green MEP to highlight new finance report at #ChangeFinance event outside Bank of England

Ahead of an event this Saturday outside the Bank of England, where she will join shadow chancellor John McDonnell, Molly has launched a report exploring the impacts of Brexit on the finance sector and how it can better serve the interests of people and businesses [1]. Dr Scott Cato, who is Green Party speaker on economy and finance, will join Mr McDonnell and other speakers at the #ChangeFinance event hosted by campaign group Rethinking Economics.

The report warns that Brexit Britain will almost certainly be poorer and concludes the finance sector will be especially badly hit, with knock-on effects in other sectors. However, it also highlights how the City has used its influence to lobby for deregulation, against bankers’ bonuses, and against the introduction of a Financial Transaction Tax.

The report says Brexit provides important opportunities. Among its recommendations:

  • A Brexit finance transition strategy which should seek to reduce the dominance of London, encourage the flow of high-quality jobs to places outside the capital, and help address accelerating financial inequality;
  • The establishment of a government-owned Public Investment Bank to lend to companies and projects that privately owned banks are failing to lend to;
  • The development of a range of innovative savings bonds specifically linked to renewable energy infrastructure;
  • The development of a system of regional public banks and the Post Office brought back into public ownership, taking on the role of a ‘People’s Bank’.

Molly Scott Cato said:

“Ten years ago Lehman Brothers collapsed precipitating a financial crisis. A decade on we now face a Brexit crisis. These two are inextricably linked. The inequality and injustice in our society exposed by the financial crisis, and the responses to it, created a sense of disenfranchisement and disempowerment which helped drive the decision by voters to choose to leave the European Union.

“Quantitative easing – the unconventional policy adopted in response to the crisis – channelled huge sums of public money to the very people responsible for the crisis, while working people have seen their wages stagnate and their public services eroded by austerity.

“This report explores how the economic and political crisis thrown up by the decision to leave the EU can be used to our advantage. Whether or not we leave the EU, we can respond positively by ensuring that the long shadow of the financial crisis can be the catalyst for long-lasting and socially and environmentally beneficial changes to our financial system.”

Author of the report, Victor Anderson, said:

“Brexit is on course to weaken the UK finance sector. This will be a disaster – but it is also an opportunity, to structure finance so that it serves the economy and the public much better than the banks and other institutions do today.”

Notes

[1] Never Waste a Good Crisis: Using Brexit to reform the UK’s finance sector, a report for Molly Scott Cato MEP by Victor Anderson. The report explores what could happen to the finance sector as a result of Brexit and how the opportunity could be used to refashion the finance sector to serve everyone, not just the few. The report draws on speculation and forecasts about Brexit; analyses of the City of London as the hub of the UK’s and the world’s finance; reports and analyses from think-tanks and experts such as New Economics Foundation, the Federation of Small Businesses, The University of Birmingham, and the Bretton Woods Project

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