Policy Chairman, Catherine McGuinness speech at Leeds Conference June 2017
Building closer links between the Square Mile, International Business and Leeds
Good morning, everyone, and thank you for your welcome.
I am Catherine McGuinness, the Chairman of the Policy & Resources Committee of the City of London Corporation, which is the elected authority that oversees the running of the Square Mile.
I am what in any other authority would be described as the political leader, but being an unusual and ancient body we don’t use such simple terms.
Besides our local responsibilities overseeing planning, street cleaning and so on in the immediate Square Mile, we also have a wide range of other responsibilities.
These include promoting and supporting the UK based financial and related professional services sector which was traditionally concentrated in the City.
In that role we aim to help attract and retain inward investment to London and the wider UK, and to facilitate overseas trade for the financial and related professional services sector, working directly with businesses and trade bodies; including the Law Society.
Our Lord Mayor – the direct (but not immediate!) successor of Dick Whittington, takes trade delegations to priority markets across the year to tell the world that the UK is open for business.
I am also as it happens a lawyer myself, having specialised in banking and financial matters all my career, first in a City law firm where I was articled and became a partner, and then in-house.
Why are we here?
You will be wondering what I, as the political leader of a London authority, am doing in Leeds at this important conference.
Well, I can tell you, I am delighted to be here. I’d also like to congratulate Bill Barton for his hard work in making this event possible.
Delighted because legal services are a crucial part of the finance and related professional services sector, which we promote.
A sector which is national, not just London based.
Which in total involves 2.2 million jobs across the UK.
Generates an estimated £72 billion of tax annually.
Impacts on the real economy and the ordinary family through the services which it provides – from bank accounts, insurance and pensions through to support for business and infrastructure.
And a sector which is a major export, as well as powering domestic growth.
The legal sector is itself a major contributor to this.
- Around 314,000 people are employed in private practice, two-thirds of whom are based outside London.
- The UK legal services sector contributed £25.7bn to the UK economy in 2015, and
- The UK accounts for 10% of all global legal services fee revenue.
Leeds itself is a crucial part of that sector.
I am well aware that for example DLA Piper, one of this country’s great law firms, had its birthplace here, founded by two great Leeds figures Thomas Dibb and Sir Charles Lupton.
I don’t need to tell you that today, Leeds has the most diverse economy of all the UK’s main employment centres and has seen the fastest rate of private sector jobs growth of any UK city.
Your location – lying at the heart of the Northern Powerhouse, if the expression is still used – has huge strategic benefits. For example, linking up the strategic capitals of London and Edinburgh.
This research paper shows that Leeds is home to a wide variety of law firms with a diversity of sizes and structures, ranging from international players to highly specialised niche practices, and trusted to deliver world-class advice and services across the world.
And it’s great to hear how your law firms here are making a positive difference to society by taking on legal apprentices from the wider city and donating tens of thousands of hours of time in pro bono work every year.
Impressively, the legal sector in Leeds alone employs over 8,000 people!
What a contribution to our economy!
Your city plainly has a bright future and is a strategic centre for UK growth; it is the focus of billions of pounds of public investment in transport infrastructure with new high-speed rail services to London and Manchester planned.
Why it’s important to connect across regions
All of which underlines your importance to the UK economy and why we - in London - are interested in what is happening here.
Connections and links across the UK are important in themselves as we are all part of the same ecosystem, contributing to UK wellbeing and to national jobs and growth.
And although the City of London Corporation has long recognised this interconnectedness I am not sure we have approached our relationship with the rest of the UK as strategically as we should.
Indeed one of the lessons I take from the Brexit vote last year and the debate around it, is the division which we collectively have allowed to grow up between our great metropolises and the rest of the country.
Which is why I have made one of the main objectives of my own time in office to build stronger and better relations outside London.
We, at the City of London Corporation, have just agreed to a new regional strategy focused on working in partnership with regional inward investment organisations to…
- retain investment in the UK…
- attract new investment into the UK….
- and for regionally based firms to participate in the City Corporation’s work programme to encourage UK exports.
Connections and links across the UK are important in themselves.
But particularly so at this moment, as we face the national challenge and opportunity of leaving the European Union and taking a new place on the world stage.
And on that note let me return specifically to the legal sector.
Why the English legal sector is so important
It’s easy to see why the UK legal sector has been so important. Why it is such a global player.
- English and Welsh Common Law is used by businesses across the world. It is trusted for its clarity, fairness, predictability and consistency.
- The freedom of contract which our system allows is prized. There are very few mandatory provisions for business. Write your bargain down clearly and it will generally be given effect: the courts will respect what you have agreed.
- As a result our law is widely chosen as the applicable law to govern contracts, often where there are no UK parties, for example across finance, insurance, trade and construction.
- Our system for enforceability of judgments has developed to allow reciprocal enforcement with many countries. Our courts are used to working with other laws and enforcing judgments from courts of other countries. It is part of Britain being open for business.
- Our commercial lawyers act as deal lawyers and advisers, they aren’t just involved in resolving disputes. UK lawyers follow clients (British, Other EU and non-EU) around the world (in a way that lawyers from other countries typically don’t) to advise on transactions: understanding clients’ businesses and making business happen, not just picking up the pieces.
- So it is not surprising that the United Kingdom is in the top 10 nations in the latest Rule of Law Index and its legal framework is viewed as among the most efficient in Europe, significantly outranking those of France, Germany and Spain.
That supremacy, though, faces challenges, and if we don’t navigate the Brexit process smoothly it could be undermined.
To take just a few examples, and at a high level:
- Firms or individual lawyers operating across border into the EU need solutions so that they can continue to do so.
- Recognition and enforcement of judgements needs to be preserved; we need to be sure that judgements from the English courts carry the same weight that they presently do.
- We need to protect the legal certainty and pragmatism for which our system of law has rightly been prized.
- And there are whole areas of law which are currently integrally tied up with EU legislation and regulation – for example, data protection, intellectual property, patent protection and competition law. An area where we not only need to import EU legislation into English law but to ensure lawyers are authorised to advise.
Pascal Lamy, former World Trade organisation chief, recently likened Brexit to removing an egg from an omelette.
Well, as far as I am concerned, if there is one section of the UK national economy, that we do not want scrambled, it is UK law.
It’s vital that this sector is enabled to make the most of its contribution to the growth of our economy, and to this country’s ability to remain a global leader.
It’s vital that its needs and concerns – both for business and for the sector itself – are recognised and addressed through the Brexit process.
That’s not easy.
There are many complexities involved.
Indeed I am leaving this conference early to go back to a meeting of the Brexit Law Committee, a committee reporting to the Ministry of Justice and looking at some of the challenges the sector faces.
But for all the work experts can put in identifying the sector’s needs, our future rests in the hands of those negotiating our exit arrangements and the framework beyond: primarily, our politicians.
We meet in interesting times, as Parliament seeks to digest the outcome of the General Election.
My phone has been hot since Monday with calls from across the financial and professional services sector expressing the hope that Parliament with reflect and reset the tone of our Brexit approach.
Will listen more carefully to the needs of business.
And seek to deliver the sector’s three core asks:
1. Access to people – our most important asset – and where we need to assure existing overseas staff that they are welcome here and reach arrangements allowing for appropriate future recruitment.
2. Secondly, an early agreement on a transitional period, giving us all time to move smoothly through the Brexit process. As lawyers, you will all know how much work this is likely to involve, as arrangements are repapered and contracts amended. Transition is
vital for business certainty and without it, businesses may prematurely move.
3. Thirdly, a bespoke British agreement providing for mutual market access. An agreement which works for us, and works for the EU.
This is a time of national challenge and now - more than ever - our regions - and our cities - must come together to meet that.
We must look to engage and speak up as a united business community on how best we can navigate Brexit and look for the opportunities beyond.
Which is why I am really pleased to hand over to Hillary Benn and look forward to hearing what he has to say on how Leeds – and the rest of the country – can flourish after Britain leaves the EU.
The fundamental strengths of our world class economy remain.
Global reach and reputation, unrivalled expertise and insight and the ambition to succeed in a global industry.
There is much we can do together.
I wish all of you here a successful conference and I look forward to working with you to ensure the continued success of the UK legal sector.