Newletter 21/04/24


A row has broken out amongst EU members over reforms to the supervision of capital markets across the bloc.

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Dear Subscribers,

A row has broken out amongst EU members over reforms to the supervision of capital markets across the bloc. France and Germany are pushing for more powers to be given to the EU-wide regulator, ESMA, which is based in Paris. The proposals are unpopular amongst smaller nations, who fear losing a competitive advantage which allows them to compete for business with the largest economies in the bloc.


Unhappy families

The governments of Sweden and Finland have complained about the EU’s lack of progress in reaching free trade deals which they blame on a protectionist mindset and the insistence on environmental provisions. The lack of progress is, they say, having a negative impact on the EU’s global influence as an economic power.

The Prime Minister has promised to get the Rwanda Bill through Parliament on Monday, saying that peers and MPs, will ‘sit there and vote’ until the law has been changed to allow flights taking illegal migrants to Rwanda to take off. This was in response to an attempt by Labour peers to amend the legislation (the fourth such attempt) to limit the government’s ability to deport illegal migrants to Rwanda.


The PM’s Rwanda policy approaches Last Chance Saloon

Trade Minister Kemi Badenoch has spoken out against plans by the Financial Conduct Authority to require firms to set diversity targets, calling them ‘counterproductive’. The plans are a blatant example of regulatory overreach. The purpose of the FCA is to reduce systemic risks in the financial sector, not to force firms to indulge faddish HR practices.

A international conference of conservative thinkers, commentators, and politicians was forcibly shut down by the police in Brussels on fanciful concerns about public order. A Belgian court quickly overturned the decision to close the event made by a socialist mayor opposed to the views of some attendees on gay marriage and euroscepticism. It was a blatant attempt to censor political opponents. This is a local symptom of a worrying wider trend: civil authorities responding to threats of unruly protests by cracking down on those who the protestors wanted to stop in the first place over concerns about ‘public order’.


Boris Johnson on the UK’s faltering trade negotiations with Canada

Kemi Badenoch on DEI indoctrination


Hear, hear for suspended food tariffs by Catherine McBride

The UK has finally suspended its tariffs on tropical fruit and nuts, citrus fruit juices, and even on tofu. But the key question is why did we keep these tariffs after Brexit – they were designed to protect EU manufacturers but they harmed UK consumers and as we don’t have the climate to grow these foods, didn’t protect UK farmers. My only complaint is why is this suspension temporary and why aren’t the many other foods we can’t grow or don’t manufacture also on this list?

The UK’s entire tariff structure requires a fine-tooth comb, to eliminate tariffs and quotas on the goods that we don’t or can’t produce in the UK. There are literally hundreds of products: rice, buckwheat, millet, quinoa, cocoa butter, cocoa powder, roasted coffee, green tea,  ground pepper, vanilla, cloves, pineapples, mangoes, avocados, dates, figs, bananas, oranges, lemons, grapes, watermelons,  apricots, peaches, kiwifruit, yams, sweet peppers, asparagus, olive oil, palm oil, sunflower oil, coconut oil, soy oil, linseed oil, sesame oil, fruit juices, preserved vegetables, I could go on, but I am sure you get the idea. We add tariffs to imports of all of these foods.

Key Points

The Financial Conduct Authority has, at least in theory, a very important role to play in the UK economy. Along with the Prudential Regulation Authority, they set many of the rules which constitute the financial system. Their task is to design a system of rules which allows market forces to allocate financial resources freely and efficiently while eliminating systemic risk and abuses of natural imbalances in financial power. Such a system continues to elude even the most advanced economies and is particularly elusive in an age where technology is making profound changes in how people ‘do finance’ both on the High Street and in the City.

That an organisation with such a clear mission could waste its time trying to impose diversity targets on businesses is a sad symptom of a modern malaise. Having lost sight of the purpose of institutions, the resulting void in strategy is filled with the shallow rhetoric of DEI. Under the banner of social justice, all manner of mad mandates are introduced by bureaucrats who have forgotten why they were entrusted with power in the first place.

The result is regulatory overreach in areas of life which don’t need regulating while the actual purpose of an institution is neglected. The FCA could spend a thousand years making hiring and firing in the financial sector perfectly just or making boardrooms perfect imitations of society at large and not prevent a single fraudulent transaction nor do anything to eliminate systemic risk. The FCA is one amongst many institutions to be lured away from its founding purpose by the siren-song of diversity and inclusion.

Kemi Badenoch’s intervention is therefore welcome. But her criticism does not go far enough. To say that diversity targets would be ‘counterproductive’ is to imply that promoting diversity in the private sector is something which the FCA ought to do. Since it contributes nothing to the FCA’s guiding function, plainly it is not. She should have said that it falls outside of the FCA’s remit and therefore constitutes an abuse of power.

The FCA is just one amongst many institutions who are increasingly distracted from their day jobs by experimental attempts at social engineering. With the Conservatives heading for a long period in the political wilderness, there is unlikely to be any impetus for change from central government any time soon. Slowly, the whole of Whitehall will reorient itself away from doing useful things for the general public and towards vapid interventions in how private firms organise human resources.

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Briefings For Britain