With just a couple of days to the general election it appears that firms in London’s financial district (the ‘City’) are backing Boris Johnson to win the election though the majority of executives working in the City believe the Brexit deal brokered by the prime minister would be bad for the financial district.
According to a recent poll of more than 100 executives working in financial services, 56 per cent said a Conservative Party victory would be the best outcome for the area, with a further three-quarters of respondents believing the Tories are the natural governing party for the City.
“The Conservative Party is the only route to some degree of certainty,” said one respondent to the poll. “The other option risks a return to 1970s or even Soviet-style communism, in which the state would control financial services. With an election being held for the third time in less than five years, Johnson had said he wanted to break the deadlock in parliament, citing it as “the only way the country can move on”.
Huge political upheavals over the past few weeks and months has forced financial services to contemplate what many see as two unpalatable scenarios: a no-deal Brexit, which has been a strong possibility under Johnson: or a surprise election victory by the Labour Party and Jeremy Corbyn.
The poll of 112 workers in the City revealed that the Square Mile cannot stomach the idea of Corbyn, who had made clear his intentions to increase income tax for the country’s richest people upon taking office. Just 5 per cent of respondents thought a Corbyn government would be the best outcome for the financial district. Chief market analyst for Markets.com, a trading platform, Neil Wilson, said: “You need your head examined if you work in the Square Mile and don’t vote Tory.” The founder and managing partner at Better Capital, the private equity firm, Jon Moulton, added: “Brexit bad. Corbyn worse. Hail Boris.”
The support for Johnson chimes with the results of a separate poll of a group of heavyweight investors that manage hundreds of billions of pounds. They have backed the PM to win the general election and keep the Conservative Party in power.
According to that poll of 49 influential investors, conducted by opinion-sharing platform Procensus, before campaigning began last month, almost 30 per cent believe the British public will vote to keep the Tories in government. Not one investor said the Labour Party would be able to win the election and form a government on its own.
A finance professor at London’s Cass Business School, David Blake, said: “It’s not surprising that the City does not support Labour, given it wants to impose a Marxist-style government bent on confiscating everyone’s wealth.
“What is surprising is the view recently expressed by some, such as the Institute for Fiscal Studies, that a Corbyn government would be better than a no-deal Brexit. Anyone who believes this must have taken leave of their senses.”
Despite the support for Johnson, the poll also found that two-thirds of City workers felt that if Brexit were to be cancelled it would be overwhelmingly positive for financial services.
This sentiment, however, has not translated into meaningful support in the City for the Liberal Democrats, who have said they would move to revoke Article 50 and halt the Brexit process if they won a majority in the election. The poll found that only 14 per cent of workers in the financial district believe the Lib Dems are the natural governing party for the City.
Sir Vince Cable, the former Liberal Democrat leader, said: “Maybe the City hasn’t collectively thought through what Brexit means. There is of course an alternative to Corbyn and Johnson, which is the Lib Dems: pro-business and with a proven record of competence in government.”
“Most people in the City appear to want to remain in the EU, so it is perhaps surprising that more of the respondents have not favoured the Lib Dems – who are the most pro-remain national political party in the country. Perhaps they do not believe they will be in a position to form a government,” said Blake.
He added: “It will therefore be interesting to see how well Chuka Umunna, the new Lib Dem candidate for the Cities of London and Westminster, does in the general election.”
(The author is our foreign correspondent based in the UK. He can be reached at firstname.lastname@example.org)