Incentives urged to encourage regional investment by financial services sector

The Big Four consultancy claims that “sustainable and well-regulated” growth in a well-functioning sector could add an extra £62bn across the UK by 2020.

This figure includes investment in IT equipment, new buildings and R&D, the increased provision of credit and greater employment, which has a knock-on effect on consumer spending.

PwC estimates that this would create an extra £2.4bn in Yorkshire, £5.3bn in the North West and £300m in the North East, compared to an extra £24.9bn in London.

Gary Shaw, who leads the firm’s financial services practice across Yorkshire and the North East, said: “Yorkshire has one of the largest financial services sectors outside London.

“With strong technical capabilities and a diverse base of FS firms, including head office functions, specialist back office functions and regional HQs of major UK banks, it is no surprise that the region could significantly contribute to the UK’s growth by 2020.”

He singled out the Yorkshire, Skipton and Leeds building societies as important national players. Mr Shaw said: “Given the importance of the regions outside London for driving growth for the rest of the UK, policy makers should explore ways to grow the financial services industry across the UK.

“We are seeing many financial services institutions looking at ways to improve their UK regional footprint, so Government support in the form of offering incentives for financial services businesses looking to locate activity outside of London would be welcomed.

“By encouraging investment across the UK, the FS industry will be able to access a wider pool of resources and at a lower cost than in London.”