There is a new series of Industry coming up, which, as its name does not suggest, is a BBC series about goings-on in the City — or rather in a fictional investment bank, Pierrepoint. This paper billed it as Squid Game without the subtitles: bankers profiting from Covid, badly behaved suits; juniors working all hours on, er, stimulants. There is, it would seem, zero scope for lovable and ethical City people on stage or screen.
This may be why there is so little political will to engage with the crisis in the City. In the manifestos you look in vain for acknowledgment that the London Stock Exchange, the institutional face of the finance sector, is in a bad, bad way. Rather than counting the companies not floating their shares here or transferring their listing abroad, to New York for instance, it saves time to mention the one company that did float here: the computer business, Raspberry Pi. Oh, and Shein, the Chinese online retailer, may list here, which would be huge, except it’s too toxic for New York.
There simply isn’t the capital coming in that might make London attractive to high-growth companies
So far this year, listings in London have raised less than £100 million. There simply isn’t the capital coming in that might make London attractive to high-growth companies. The no-shows are telling: Octopus, the energy retailer; Tui, the travel giant; Paddy Power decamped to New York. Shell has hinted that if its pariah status doesn’t improve, this stalwart of the Stock Exchange may exit too. Well done, Extinction Rebellion!
Trouble is, none of the parties are registering the crisis. Certainly not Labour. The London market is over regulated; Labour, on past form, will make it worse. As the financial author Matthew Lynn points out, its requirement that companies invest in green infrastructure means that there will be even fewer funds available to invest in normal equities. Its appetite for windfall taxes won’t do it for Shell. Worse, its likely increase in Corporation tax will squeeze investment further.
And the Tories? The Chancellor’s brilliant initiative of a British ISA, £5,000 tax-free to invest in UK equities, is beside the point, viz, The Stock Exchange is on a terrifying trajectory of decline. Once, the party would have cared.
As Industry shows, it’s hard to love the City. But our politicians should, if they know what’s good for us. Don’t they?
