Lloyd's 2016 City DinnerTue 06 Sep 2016
Speech by Sadiq Khan, Mayor of London
Speech by Sadiq Khan, Mayor of London
Thank you John for that very kind introduction.
John actually lives in a great part of London – Tooting.
As some of you may know – Tooting was served recently by a half decent MP!
As John mentioned, he is planning on retiring next year.
John has had a distinguished career spanning five decades.
Most recently of course as Chairman of Lloyd’s, but also with Kleinwort Benson, Lazard Brothers and Credit Suisse amongst others.
John is seen as a key figure in the City representing the insurance industry, which has traditionally seen London as its hub.
And I’m sure I speak for everyone here when I say he’ll be a massive loss - not just to Lloyd’s of London, but to the whole business community.
John – thank you.
It’s a real honour to be here this evening.
And an honour to be invited to make this speech at only the second City Dinner held in this incredible space at Lloyd’s of London.
This is one of our most iconic modern buildings in London and the home of the world’s premier insurance market.
Some incredible things have been insured here over the years.
Aside from the obvious things we all know about -
Space tourists who plan to go to the International Space Station.
Bruce Springsteen’s voice.
Bette Davis’ waist.
And Ken Dodd’s teeth.
But I’ve looked, and there’s one thing I couldn’t find - and that’s an example of Lloyd’s ever insuring a promise made by a politician.
What a shame. I’m not sure whether it’s concerns about the premium, the risk or the capital! But there you go…
No, but seriously - this place is at the heart of what makes London such a great financial capital.
A vital organ in sustaining our economic success.
And a British institution we should all be proud of.
It’s called Lloyd’s of London, but it has an incredible global reach and reputation.
Since the 17th century - from starting out in marine insurance - the Lloyd’s market has helped business thrive.
And adapting to meet the needs of a fast-changing world.
Brexit intro - signpost speech
This story of change and evolution is fitting in the current political and economic climate.
For as we stand here this evening, we are facing one of the most uncertain and challenging times in recent history.
The result of the EU referendum has shaken up the political and economic landscape, and the dust is unlikely to settle for many years to come.
The fact that we seem to have avoided an immediate crisis doesn’t tell us much about the future.
And we have to be honest with the public and ourselves that things could get a lot worse before they get better.
Like Lloyd’s - and I suspect many businesses represented here tonight - I supported Britain remaining within the EU.
It’s no secret.
I campaigned hard.
I campaigned for what - in my view - was clearly in the best interests of London and the whole country.
But the British people gave their verdict and this now has to be respected.
The people have expressed their democratic will.
And as tempting as it might be, I’m not going to use this speech as a platform to criticise the Leave campaign or the senior politicians who were involved in getting us where we are today.
Because we are where we are.
And what’s important now is that rather than looking backwards, we focus on how we respond, adapt and move forward with the confidence befitting our great city.
And that is what I want to talk about tonight.
Primarily, I see my role as Mayor following the referendum as two-fold.
Firstly, standing up for London – making sure we get the deal we need with the EU to secure the future prosperity of our city.
And secondly, working with the Government to put in place new initiatives to help boost jobs, growth and investment. Planning ahead to mitigate against the potential long fallout of Brexit.
So this will be my approach: In London's corner to protect our competitiveness. And actively fighting in the ring to advance our city ever forward, making it better for all Londoners.
So let me address these two strands in turn.
Seat around the negotiating table
The EU negotiations.
I’ve been crystal clear that as not only the UK’s economic engine, but Europe’s financial capital - and the only region of England which voted to Remain – London must have a seat at the negotiating table.
And I’m pleased that this is looking increasingly likely.
Since the 24th of June, I’ve been busy engaging with the financial sector, business leaders and entrepreneurs to discuss their Brexit concerns and to look for potential opportunities that could come from being outside the EU.
And I’ll be continuing this process.
Working with you.
Working with businesses across London.
And talking to the Government as they formulate their position and hone their red lines.
I’ll be a strong voice for you – not only when talking to the Government, but in Brussels too - an advocate for business, for the financial sector and for the whole of London.
But I also have a request for you and everyone here tonight:
As much as possible, businesses and institutions in the City of London need to be united.
United when putting forward your needs and requests for the EU negotiations.
Of course, there are different priorities in different parts of the financial sector.
Investment banking has different needs to insurance.
But the more united our message to Government can be, the stronger the impact will be – making it harder to ignore or sideline our needs.
So what do we want from the negotiations and what reassurances do we need from the Government?
The UK’s top priority has got to be securing a model of access to the single market that enables us to remain competitive globally.
And as leading people in financial services, I don’t have to tell you why.
500 million customers.
Nearly half of all British exports – many of them built upon our financial passporting rights.
The foundation of British jobs, wealth and prosperity.
Getting simple, easy and comprehensive access to the single market for our financial sector is not only central to London’s ongoing status as the world’s leading provider of financial and professional services.
It is - by extension - key to our nation’s economic stability and future growth.
And I know, as John said this morning, Lloyd’s of London is concerned about the possible loss or reduction of the passporting rights, which could see insurers being forced to restructure and face large operational, regulatory and tax costs as they have to adapt or consider alternative locations to London.
So the Government needs to be creative in its solutions, and ambitious in its negotiating platform.
This isn’t just about how we can best replicate Switzerland or Norway – models which, if we’re honest, don’t work either politically or economically.
Remaining a member of the single market without the ability to wield influence over the regulatory regime is just a non-starter.
But I’m confident there is a workable deal to be agreed.
A unique British deal, that works for London.
A deal that will enable London to remain a world-leading city for finance.
Talent / universities / visas
The second priority is ensuring that we can keep and attract talent.
We have become one of the biggest, richest and best cities on earth because of our openness to trade, innovation and talent.
As John said recently, the talent here at Lloyd’s is probably its greatest asset.
Throughout our history, London has always been open to the world.
Always looking outwards and trying to learn from others.
And always looking to attract hard-working, inspiring and pioneering people.
It’s this open attitude that has helped to build our country.
It’s why London became the great city it is today.
And it’s why we attract the best and the brightest from around the world.
Let’s be clear: London’s competitiveness as a global city is intrinsically linked to our openness to international talent.
And this is something we can’t afford to lose.
Almost one in ten Londoners were born in another EU country. Many are highly skilled, working in the city and elsewhere, making a massive contribution.
I’ve been clear that these Londoners are still welcome here, and that this must never change.
And I’m calling on the Government to state unequivocally that no retrospective legislation will be introduced that curtails the rights of EU nationals currently working in London – whether they started before or after the referendum vote.
I want you to have the confidence, and the ability, to continue to hire the best and the brightest from across the EU and further afield – both during this uncertain period, and following Brexit.
It’s absolutely crucial that the visa system following Brexit works for London.
That it’s flexible.
That it’s not arduous on businesses.
And that it can support economic growth.
And this work also includes looking at visas for foreign students.
Because one of my biggest concerns around Brexit is the impact on the higher education sector.
London’s universities and higher education institutions are key drivers in our economic success.
Not only providing a rich source of talent, but through innovative research and spin offs.
London is home to some of the world’s greatest universities.
And we have more international students here than any other city.
And I’ve already started working with universities to ensure that they can remain world-class institutions, and continue to produce the brilliant graduates you need year-after-year - helping London keep our competitive edge.
Timing – Article 50
The third key area I want to touch on is timing.
Timing for the negotiations is going to be absolutely crucial.
We can’t rush into triggering Article 50.
The only chance of getting a ‘successful Brexit’ deal – one that works for London and the whole country – is by going in fully prepared.
It would be irresponsible in the extreme to start the 24-month countdown before we have a watertight game-plan.
As a country, this is going to be the biggest negotiation that we’ve ever undertaken.
Over the last 40 years, a complex political, economic and regulatory relationship has been built up between the UK and the EU.
Triggering the start of the clock before we are much clearer on the path ahead, would increase uncertainty, rather than reduce it.
It’s great to be at the same table as the Cabinet Secretary and Head of the Civil Service, Sir Jeremy Heyward. But as the former head of the Civil Service Lord O’Donnell, recently said: the two year timetable was designed to favour the countries staying in the union.
So let’s not fall into that trap.
Of course we have to fulfil the wishes of the British people.
But we have to take our time and proceed in a responsible way –with an approach that doesn’t damage our economic prospects unnecessarily and that can provide as much stability and certainty as possible.
This is what you need. And this is what I’ll be fighting for.
And I’d say to those in Government who fought for Brexit and are now leading on the Brexit agenda:
If you believe and want that one day you will be proved to have been on the right side of history, you better plan well and proceed with care.
If you rush it, you risk botching not just the negotiations, but the ability for our economy and our businesses to adapt, and with them - Britain’s economic prospects.
Second strand – promoting growth and investment
Turning to the second strand I mentioned at the start, which is about how we can actively boost growth, jobs and investment in London.
Monetary policy can offer relief to the economy in the short-term.
But to strengthen London’s shield against the expected blows from Brexit, we have to push ahead now with plans for jobs, growth and investment.
This is more important than ever.
And it’s why I’ve already been setting the groundwork for investment and growth in London.
Looking at how we can support SMEs and start-ups by providing them with more affordable workspace.
Expanding the Night Tube to help boost our nighttime economy.
Putting in place plans to build the thousands of affordable homes London needs to improve productivity.
Pushing ahead with big infrastructure projects in London, by completing Crossrail 1, getting Crossrail 2 off the ground and supporting the delivery of HS2 in a way that benefits the city.
Planning the next major infrastructure projects for the long-term – such as the potential Crossrail 3, new tram extensions and new river crossings in East London.
Supporting increased aviation capacity by signing off on the expansion of City Airport and backing a second runway at Gatwick.
And working with businesses to support newer growth industries, like tech, low carbon and life sciences.
Skills for Londoners / working in partnership with business
And one area in particular we’re looking at is skills.
Whenever I talk to businesses across London, you tell me that a key barrier to growth is the lack of certain skills in our workforce.
Politicians have not been good enough at ensuring businesses have access to the skills you need – not just today, but for the future.
So I’m determined that we get better at responding to the needs of industry and the growing sectors of our economy whilst putting productivity front and centre.
That’s why I’ve pledged to lead a new skills agenda for London, making sure businesses and Londoners get the skills they need to succeed.
A major part of this will be working on a new digital talent pipeline initiative, led from City Hall.
With new powers over skills and higher education devolved from Whitehall to London.
We’re actively investing to open up new opportunities for young Londoners.
That means mapping the skills London needs and working in partnership with businesses to plug the talent gap.
New courses and apprenticeships will be created with industry to provide young people with cutting-edge skills - skills that can lead them directly into well-paid jobs.
And all of this work – from building genuinely affordable homes to creating new apprenticeships - will be done in partnership with you.
Because I understand the importance of working closely with business – something that is now a central plank in how we’re doing things at City Hall.
As part of this, I am in the process of setting up a new Business Advisory Board, made up of real experts – and I hope some of you will be able to be involved in that.
Finally, I’d like to finish by saying a few words about devolution.
Because I believe that devolution is one of the key tools to stimulating growth and being able to protect London through these uncertain economic times.
London’s population is the same size as Wales and Scotland combined, but we have far less control over how the capital is run.
That’s why I’m talking to the Government about getting more autonomy in London over things like business rates, infrastructure investment, skills and housing, so that we have more tools to stimulate economic growth.
And I hope to able to say more about this in the coming months.
So yes, we face some huge challenges ahead.
And on occasions, it’s going to feel like the City is being rocked by the repercussions of Brexit.
But I’m still optimistic for London – and not naively so.
I’m confident that we’ll continue to be the best place in the world to do business.
And convinced that just like Lloyd’s has managed to change, adapt and evolve over the centuries, we can do the same – ensuring that we carry on flourishing over the decades ahead.
With the right approach, I know that we can get a good deal that works for London with the EU, whilst at the same time promoting new business, attracting inward investment and actively supporting growth.
And as the Mayor of London, I’m determined to make sure this happens.