POST-Brexit reforms aimed at boosting growth in the United Kingdom’s powerful financial sector are a “damp squib” that have had little effect on the economy, a cross-party group of MPs said today.

The government trumpeted its 31 so-called “Edinburgh Reforms” in December last year as a way of maintaining the UK’s position as a leading global financial hub.

London has been trying to stimulate growth in the financial sector in the face of greater competition since Brexit from European centres such as Paris and Amsterdam.

One of the reforms’ key measures was to abolish “ring-fencing”, which separates retail and investment activities at smaller banks.

But 12 months on, parliament’s watchdog Treasury Committee said the move had yet to be introduced and the government had only just finished a consultation on the practice.

The government said it has implemented 21 of the 31 reforms this year but the committee said in a report that six of those 21 activities marked as “delivered” were in fact not complete.

Six others – such as publishing documents or welcoming a consultation – should not have even been considered reforms in the first place, it said.

Committee chair Harriett Baldwin said the finance ministry, known as the Treasury, was “absolutely right” to look at reforms given the 2008 global financial crash and the UK’s 2016 vote to leave the European Union.

Regulation of the financial services sector was needed to encourage growth, the Conservative lawmaker said.

“We welcome many of the changes as logical and sensible measures. We do, though, question the validity of claims that welcoming consultations, establishing reviews or publishing documents should be considered reforms,” she said.

“The Edinburgh Reforms were given considerable fanfare last December but, 12 months on, the lack of progress or economic impact has left them feeling like a damp squib.”

In response, the Treasury did not acknowledge the conclusions, but maintained the reforms showed the UK was committed to creating a “sensible, innovative and robust financial landscape”.

“Over the past year, we’ve made significant strides towards creating an environment that supports economic growth, openness and the wellbeing of savers,” Economic Secretary to the Treasury Bim Afolami said. – AFP, December 8, 2023.