Key facts
- Tory leader Kemi Badenoch will pledge to use the City of London as a central lever for driving economic growth.
- She will suggest financial regulators have buckled to pressure and that the City has not been properly championed by successive governments.
- Badenoch will criticize the UK's "risk averse" culture regarding investment and savings.
- Her speech will address the stagnation of UK equities, a drop in company listings, and stifled business investment and productivity growth.
- Badenoch will call for "bold structural reform" in the City, reminiscent of the 1980s Big Bang.
- She has opened the door to scrapping stamp duty on shares, stating she "hate[s] transaction taxes."
- Badenoch linked potential growth in the City to increased defense spending.
Tory leader Kemi Badenoch is set to deliver a speech championing the City of London as a crucial engine for economic growth, criticizing past governments for their approach to the financial sector and advocating for a less risk-averse culture.
In her address to City financiers, Badenoch will argue that successive governments have treated the financial sector as a "problem to be managed" rather than a key driver of the economy. She plans to highlight the stagnation of UK equities, a decline in company listings, and stifled business investment and productivity growth as consequences of this approach. Badenoch will call for "bold structural reform" of the City, drawing parallels to Margaret Thatcher's Big Bang reforms of the 1980s.
Badenoch and her shadow chancellor, Sir Mel Stride, have intensified efforts to appeal to the City. Badenoch has also expressed openness to scrapping stamp duty on shares, a move that analysis suggests could offer significant economic benefit. Sir Mel Stride has commented on market assessments of the Labour government and pledged to reduce liability red tape for company managers.
The debate over financial deregulation is becoming crowded, with Reform UK leaders Richard Tice and Robert Jenrick also advocating for substantial reforms. Chancellor Rachel Reeves has focused her growth ambitions on driving retail investment through ISA reforms and urging regulators to prioritize growth.
Badenoch intends to link the City's growth potential to increased defense spending, suggesting that a stronger financial sector could support higher expenditure. She has publicly urged the Labour government to cut welfare spending to invest more in defense, referencing offers made by her party.