The formation of a new Commission and Parliament provides an opportunity to re-evaluate the work programme within the current political and economic context, and to build for the future around four key imperatives:
- First, the agenda needs to change to delivering jobs and growth, underpinned by competitiveness, competition and innovation.
- Second, positive action is required to promote the contribution that the financial sector can make to jobs and growth. Jean-Claude Juncker calls for a capital markets union: this must be about getting the single market for capital to work – rather than more regulation. Long-term financing needs to be facilitated and encouraged. European capital markets need to be developed. And banks need to restore their role as providers of loans, trade finance and risk management services.
- Third, the regulatory reform agenda needs to be revisited and rebalanced. Although many of the individual measures were necessary, the number of measures and the severity of their calibration has resulted in a negative impact of regulation on economic growth in Europe. FTT is counter-productive; and structural separation is unnecessary on top of national legislation and other reforms.
- Fourth, greater certainty is required about the end-point of regulatory reform, to enable financial institutions and their customers to plan more effectively for the long term.
Our paper proposes specific measures to deliver these objectives, read the full report (PDF 320 KB).