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Tories bidding to win back the City

Paul McMillan finds Conservative vice-chairman Richard Spring leading a drive to get business backing the party

The Conservatives are lining up a campaign to win over the City and put themselves at the heart of the financial services community.

Suffolk West MP and party vice-chairman Richard Spring says the Tories must show they are the party of choice for the business community.

He has set up a consultation panel with financial services experts looking to make sure industry concerns are voiced in Parliament, with Spring acting as a cond- uit to the Tory Treasury, pen- sion and trade and indus- try teams.

Responding to suggestions that leader David Cameron is repositioning the Tories at arm’s length from the City, with anti-business rhetoric filling news pages, Spring says there is no contradic- tion in demanding better social responsibility from firms while standing up for business interests, asserting they should go hand in hand.

Spring says: “We want a thriving business commu- nity creating jobs and will continue to fight over regu- lation. Nevertheless, it has to be socially responsible, which will help build brands, increase public perception of the industry and help business growth.”

Spring, who also co-runs the Tories’ City Circle fund-raising body with money broker ICAP chief executive Michael Spencer, says he will spend the early part of the year shoring up the party’s relationship with the financial services community, listening to concerns and keeping a close eye on issues affecting the industry.

He says the Tories have not spent enough time focusing on the specifics of the Government’s financial services policies and now is the perfect time to prove the Conservatives would make a difference by attacking the Treasury’s “functional incompetence”.

He focuses on Chancellor Gordon Brown’s U-turn on Sipps as a prime example of the damage done, making announcements without producing enough guidelines to industry or thinking through the economic consequences in the fine print.

“If you are making major changes to pension flexib- ility, a Government needs to do so with more caution and ruthlessly check the suitability of these new policies before announcing them and leading on the industry,” says Spring.

He is also concerned about future VCT amendments from the Treasury, including the anticipated lowering of the current 40 per cent tax break. Spring questions whether these changes would be appropriate and says there is much to be said for maintaining the current levels of tax benefits.

Regulation is a common source of Tory ire and is still top of Spring’s agenda. He remains committed to calls for refundable fees for Financial Ombudsman Service complaints, no future single EU regulator and a mora- torium on European reg- ulation.

Spring says he will be consulting the industry to form- ulate specific policy propo- sals to lessen the burden of regulation without uninten- ded consequences, although he also warns against try- ing to cut red tape for the sake of it.

He says he is not criti- cising work done by indiv- idual FSA figures, saying their hands are tied and describes them as “products and creatures of ineffective Government policy”.

The most significant improvement to the regulator would be to make promotion of competition a free-stand- ing FSA objective, says Spring, an idea put forward by FSA director for wholesale and prudential policy Michael Folger at last year’s Tory conference in Blackpool.

Spring says: “The FSA would be the best governor of industry competitiveness and such a move would give it more licence to lessen the regulatory burden on the industry.”

He says the FSA’s “culture of pre-emption” needs to be tackled as it is leading to regulatory creep, with people fearing the regu- lator rather than working alongside it.

Spring is looking forward to getting to grips with his new role and is hoping that the Cameron “bounce” will help convince the financial services community that they are serious about regaining power, combining new, more socially liberal policies with a business agenda designed to help the industry.

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