Tory leadership candidate Liz Truss pledged on Friday that by the end of 2023 all EU laws in Britain’s statute book would be reviewed and measures thought to be holding the City of London back.
The foreign secretary promised a “bonfire of bureaucracy” if she became prime minister, including reform of the Mifid II trade rules, which she said were too onerous for small businesses. Her advisers noted that she has no intention of abolishing the entire regime.
In a statement, Truss vowed to “unleash Britain’s full potential post-Brexit,” adding: “EU rules are holding back our businesses and that needs to change. At Downing Street, I will seize the opportunity to deviate from outdated EU laws and frameworks and seize the opportunities that lie ahead.”
The EU introduced Mifid II in 2018 to offer investors more protection and bring more transparency to financial markets.
This week, after another round of eliminations, Truss and Rishi Sunak became the remaining contenders in the lead race. The vote now goes to members of the Tory party who will elect the UK’s new Prime Minister, who will be announced on September 5th.
There is no such thing as deregulation for deregulation’s sake in the city.
A regulatory expert, who asked not to be named, said financial services firms wanted to see “efficient regulation” but not a firework of rules that UK regulators had played a key role in creating before Brexit.
John Glen, former City Minister, said the Treasury Department had already optimized Mifid II through the Financial Services and Markets Act, which passed the House of Commons on first reading this month, after consultation with the City.
“Deregulation for deregulation’s sake is not where the city is,” said Glen, who is a supporter of Truss’s leadership rival, ex-Chancellor Rishi Sunak.
Truss, a former Remainer, has courted the Tory Eurosceptic right and is the favorite to beat Sunak, according to bookies and pollsters. YouGov said 62 percent of Conservative members polled supported Truss, compared to 38 percent who supported the former chancellor.
This weekend, Sunak is expected to outline his vision for the NHS to increase its appeal among party members. In a speech, he will make pledges including establishing a task force to cut bureaucracy and waste and deploying 200 “community diagnostics hubs” by March 2024.
Some MPs have privately warned that Sunak’s resignation from Johnson’s cabinet, combined with his refusal to commit to sweeping tax cuts, has reduced his appeal with the Tory base.
“I hear from Union members that there is a perception that Rishi has stabbed Boris in the back and is pursuing a socialist tax policy, so I think Liz will do better when it comes to membership,” said a senior Tory .
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Meanwhile, Conservative Party activists are frustrated by the acrimonious tone of the leadership campaign, which has caused sharp divisions among the finalists over economic policy.
“There was so much mud thrown and it got really bad,” a conservative activist told the FT. “A leadership contest should be about ideas and bringing something new to the table, and it doesn’t feel like that at the moment.”
“I don’t know of any member right now who is positive about the future of the party,” they added. “Younger members are concerned about the lack of focus on issues like housing and older members are upset that Boris was removed in the first place.”
Johnson remains a popular figure with some of the Tory base. The Telegraph newspaper has reported that thousands of party members have supported a petition calling for Johnson to be included on the ballot in the forthcoming leadership vote.
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