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City bankers should be protected from crippling regulations and taxes rather than treated like “pariahs”, Boris Johnson declared today.
In a passionate defence of the finance industry, the Mayor warned that choking off the Square Mile and Canary Wharf would hit government revenues needed for public services.
Mr Johnson lambasted Labour's new 50p top rate of tax and Brussels' plans to curb hedge funds, as well as making a strong case for protecting investment in major projects such as Crossrail.
He also savaged comments by Financial Services Authority chairman Lord Turner that making the City more competitive overseas was not a priority.
Accepting that he was going “out on a limb” to defend bankers, he said that while there were undoubtedly some in the City who did not deserve sympathy, the overall health of the sector was essential to driving Britain's economy.
The Conservative leadership have so far backed off opposing the 50p tax rate — due to come into force next spring — fearing that they will fall into a Labour trap to portray the party as friends of the rich in a time of recession.
But Mr Johnson made clear that he opposed the higher rate in principle, and because in practice it would not work.
“I will oppose high marginal rates of taxation because they failed in the miserable Seventies, because they yield tiny sums of revenue and because they only serve to drive away talent,” he said.
“I think it does matter that the City of London should remain competitive. I know how unpopular these bankers are. I know how far out I am on this limb in sticking up for these pariahs.
“But never forget, all you would-be banker bashers. that the leper colony in the City of London produces nine per cent of UK GDP, 13 per cent of value added and taxes that pay for roads and schools and hospitals across this country.
“And that is why I am willing to take the fight to our friends and partners in Brussels against ill thought out regulation.”
Mr Johnson said the City was “not so much a problem as a vital part of the solution” to the economic downturn.
“We cannot sort out the deep-seated problems of unemployed young people in London without the help of those firms that could provide work for young people.
“And it's only if we have sensible taxes and light regulation and reasonable employment law that business will be able to pay the taxes for the things we need to do.”
The Mayor took to the stage while the EastEnders theme tune played and won a standing ovation from party supporters before he had begun speaking. He began by saying how pleased he was to be in Manchester “one of the few great British cities I have yet to insult”.
He also poked fun at Labour Deputy Leader Harriet Harman, who is being investigated after she was involved in a traffic collision.
Mr Johnson said: “The tragedy of this Labour Government is that they are now set to scuttle from office with unemployment higher than when they came in, and rising, and with colossal public debt, like Peckham motorist Harriet Harman fleeing the scene of a crime.
“Once again it is up to us to sweep up the crushed indicator lights of a classic Labour car crash.”
In a reference to his cameo appearance in EastEnders last week, Mr Johnson said the Tories would have to “sort out the usual disastrous legacy — the damnosa hereditas, as we say in Walford”.
Reader views (17)
The main thing is for bankers not to be non dom, mind you the owner of the D mail is non dom in france. I found this out today and all my family are now not buying it anymore. You see I think the focus of who the crooks and tax dodgers are has shifted onto the so called work shy, unemployed and MP's. There is a big con going on at the mo and the real crooks have got us all running around missing the truth.
- John Smith, b,mouth richmond, 06/10/2009 00:34
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Boris is one of the few politicians who has the guts to speak his mind, and for this I applaud him - and agree with him on this occasion (even if I don't every time)
- Andy, New York, USA, 05/10/2009 23:01
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British bankers in Venice take water taxis at over 100 Euro a throw, stay in the grandest hotels, and eat at the most expensive restaurants. What can the ordinary person, in Italy or in Britain, possibly have to gain by them. In many respects they are 'socially useless'.
- Mark, Venice, Italy, 05/10/2009 22:39
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Sorry Boris, we gave you a chance but you blew it! Bankers have always screwed us, but Boris should start sorting out the problems in central London before getting involved in national issues. Bendy buses? The Western Congestion charge zone? Hollow promises, Boris! Vote catching slogans to get elected. What about the abandoned road works everywhere? The disaster in Oxford Circus? The chronic congestion caused by the old Labour apparatchiks at TFL? Boris is now a novelty, part-time mayor. We voted for him to make a radical difference to London but so far he has delivered zilch. But why should he bother when he’s trousering £250k a year from the Telegraph for a couple of badly written articles a week?
- Antoine Colonna, London, 05/10/2009 21:33
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I am sure he has many friends in the industry. Can't comprehend why this prat is speaking up for them.
- Kunle Sotunde, London, 05/10/2009 21:01
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Boris is wrong. this is not about bashing bankers or the city. it is about their greed. Of course banking is important to the country but that does not give bankers the right to be given huge bonuses and mega salaries based on spurious maths. Sadly I think all the publicity is going to Boris' head and he is starting to think he is PM and not Lord Mayor. Lots of busesm trains and traffic jams to fix Boris
- Jim, London, 05/10/2009 20:59
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Boris needs to remember that there is a treatment leprosy there is no known cure for being a City Banker.
- Mike M, Bedford England, 05/10/2009 19:46
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Lepers become horribly corrupted and spread their disease through no fault of their own; dealers in banks and hedge funds through their innate avarice and cynical self-seeking. Lepers deserve our compassion; financial parasites our contempt. Surely it's better to eradicate a vile disease than tolerate it lest the contagion flares up and spreads anew?
- Richard Kennard, Welling, 05/10/2009 18:19
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While bankers grow richer the Western C-Charge carries on and on and on...etc
Never mind their decendants will get their unjust rewards when they are in heaven if Inheritenc Tax is cut...
- Melvyn Windebank, Canvey Island, Essex, 05/10/2009 17:46
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Boris forgets the key issue - the banks only appeared to make such a large contribution to UK GDP. They were in reality taking on excessive risk and gambling with depositors money. The implicit guarantee of a bail out by the government enabled the banks to operate with a falsely low cost of capital, to privatise their gains and then socialise their losses. That isn't capitalism Boris! The cost to ordinary tax payers of the subsidy to banks' cost of capital and the subsequent government bail out is real and is now a massive contributor to our huge public deficit - along with overspending by new labour!
However if we can separate out the gamblers from the banking utilty and ensure that traders gamble with their own money and they make millions good luck to them. But never again should banks with an implicit or explicit government guarantee be allowed to put the banking system at risk of collapse and then use public funds to pay spectacular amounts to employees who effectively failed in their jobs.
- Alan, london, 05/10/2009 17:19
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"All illegal immigrants in UK should be granted Amnesty" Another Boris pearl of wisdom ,in the midst of high unemployment!
- E Reed, Bournemouth, 05/10/2009 16:50
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Well what do you expect from a Party whose policy was to scrap all regulations for Bankers and leave it to the Market and the Bankers' honesty to regulate themselves? When Dave gets in the Bankers will cause another crash and come back to the Taxpayer to be bailed out.
- S Jones, Kennington England, 05/10/2009 16:48
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Boris is such a buffon - always saying exactly the opposite of whay the British people feel.
- Keith Price, Luton England, 05/10/2009 16:45
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Boris is correct,Bankers must be protected from crippling regulations,they must remain free to carry on receiving their multi million pound bonuses,and bad decision making,even if they bring the country to its knees.
- Charles Beckton, Kensington, 05/10/2009 16:21
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Boris is absolutely correct
I am not a banker nor do I have a fond view of them however the fact that they are responsible for 13% of our GDP is massive
This in effect is invisible earnings for the nation, we need to keep the Banking Community centric to the UK and not allow them to go overseas, it reminds me of the brain drain
- Peter Stevens, Liphook , UK, 05/10/2009 16:07
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Boris,stop dealing with main line politics and sort out your rubbish London for Transport.Bus service useless,tube useless,wake up man,you are their to fix London problems,now get of your ar-e and start doing what you were elected to do.
- Dave, london, 05/10/2009 15:52
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I agree with Boris. I wouldn't treat bankers like lepers.
I would cross the road to help lepers.
- Gerry, Chatham KENT UK, 05/10/2009 15:28
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