The new chancellor is set to prioritise controlling inflation, a recovery in the private sector and “delivering our vision” for financial services as he gives his first Mansion House speech today (July 19).
Nadhim Zahawi will say he wants to deliver “sound public finances” to avoid pushing demand up further, and easing supply constraints that are the “underlying cause” of high inflation.
“The country should feel confident that we can, and we will, get inflation back under control,” he will say.
Inflation is at a 40-year high of 9.1 per cent and is expected to rise even further by the autumn.
The speech is Zahawi’s first since taking over as chancellor after Rishi Sunak resigned earlier this month, ultimately triggering the resignation of the prime minister.
Sunak is currently battling to be the next Conservative leader.
In the speech Zahawi confirmed his commitment to Sunak’s plans to overhaul regulation in the City.
He will say: “Our objective is clear: We want to make sure the UK remains the most open, inclusive, welcoming, competitive, safe, and transparent place to do financial services business, in the world”.
He will commit to “repeal hundreds of pieces of retained EU law and replacing them with a coherent and agile approach to financial regulation that is right for us”.
This includes reforming Solvency II, the EU’s rules for insurers, which Zahawi will say will ensure they have more flexibility to invest in long-term assets like infrastructure and increase the competitiveness of capital markets.
“We are steadying the ship. We are stabilising the economy. We are getting on with the task at hand,” he will say.
A new Financial Services Bill is due to be published on Wednesday, which will set out the government’s aims for the sector.
sally.hickey@ft.com
