'Give London a carve out' Brexit deal says mayor Sadiq Khan

Thu 12 Jan 2023
Posted by: Phillip Adnett
Trade News

City of London skyline including the Shard

London mayor Sadiq Khan is to call for a reformed relationship with Europe and an end to the “vow of silence” about the “immense damage” caused by Brexit.

In his annual speech at the Mansion House in the City this evening (12 January), Khan will claim that “Brexit isn’t working” and the “unnecessarily hard-line version of Brexit (ministers have chosen) is having a detrimental effect on our capital and country – at a time when we can least afford it”.

He is expected to call for the capital to be allowed to set its own immigration rules to ensure there are enough skilled workers to run essential services, reports the Evening Standard.

Skills loss

“The number of businesses in our city experiencing at least one skills shortage has now risen to almost seven in ten,” he will say, pointing out that the loss of more than 80,000 EU-born workers is putting a “huge strain” on the capital’s hospitality and construction industries.

“Devolving powers to London and allowing us to create a regional shortage occupation list would be one way to give businesses the ability to attract and retain talent in the areas they need it most.”

The City of London is being hit by the loss of trade and talent to its competitors, he will add.

“We need greater alignment with our European neighbours. That includes having a pragmatic debate about the benefits of being a part of the customs union and the single market,” Khan will say.

Drag on trade

The government’s version of Brexit is “a drag on growth, investment, and trade” and fixing it would shorten the recession, according to the mayor.

Rather than demanding a reversal of the UK’s decision to leave, the former Tooting MP is pushing for a closer deal with the EU, and will say “no one wants to see a return to the division and deadlock that dominated our body politic for five long years”, reports City AM.

“After two years of denial and avoidance, we must now confront the hard truth: Brexit isn’t working. It’s weakened our economy, fractured our Union and diminished our reputation. But, crucially, not beyond repair,” the Labour party mayor will say.

Labour split

According to the Independent, Labour's shadow attorney general Emily Thornberry told the BBC it was Labour’s job to “make Brexit work”.

"We're not going back into the European Union... What we now need is a decent relationship with our closest neighbours with whom we trade and do most of our trade, and we need to have a grown-up relationship and not be shouting at them, but sitting down and negotiating properly and finding compromises, and finding a way through,” she said.

London leads on start-ups

Despite Brexit, London has beaten off competition from European rivals to remain the top destination for tech investment last year with nearly $20bn was pumped into the capital’s start-ups, reports City AM.

Tech firms in London attracted $19.8bn of venture capital in 2022, some $10bn more than Paris and over $14bn more than tech firms in Berlin, data from Dealroom and London & Partners showed.

Laura Citron, boss of London & Partners, said the City’s tech sector was “looking resilient, despite the challenging context”.