Spring Forecast Statement

Baroness Bi Excerpts

Tuesday 17th March 2026 Lords Chamber

[Baroness Bi (Lab)]

My Lords, I begin by sharing my tribute to the noble Lord, Lord St John of Bletso. I am a newcomer, so I have not had the benefit of his expertise on southern Africa. I am sorry about that because it is a region I am very optimistic about. I also share the noble Lord’s concerns about the impact of AI on employment.

I declare my interest as the chair of Norton Rose Fulbright, an international law firm, although I speak today in a personal capacity.

Your Lordships will not be surprised to hear that I strongly support the Chancellor’s Spring Statement and the Finance (No. 2) Bill. Together with today’s Mais Lecture, they represent a clear and disciplined approach to economic management—one that prioritises stability, growth and long-term competitiveness.

Over the last decade, businesses have had to navigate an extraordinary succession of shocks: the wars in Ukraine and now the Middle East; the disruption caused by artificial intelligence and new technologies; the societal changes caused by Covid; and the profound economic and constitutional changes triggered by Brexit, which we are still experiencing. In that environment, what globally mobile businesses value above all else is not short-term gimmicks or headline-grabbing announcements but political stability combined with regulatory coherence and fiscal predictability.

Regrettably, that is not what the United Kingdom consistently offered in the period after 2016. Multiple fiscal events each year and uncertainty over our long-term economic direction weakened confidence and made it harder for the UK to compete for investment. The damage to our reputation was real, particularly in financial and professional services, where confidence and continuity are paramount.

That is why the Chancellor has been right not to make any new tax or spending announcements as part of the Spring Statement and to ensure that there is only one fiscal event per year. The Spring Statement demonstrates that this Government understand that credibility is built not through constant activity but through consistency.

The Government’s commitment to reducing borrowing, bringing down inflation and improving living standards is essential. In an era of geopolitical volatility—including, as we speak, the conflict in the Middle East, with its global economic consequences—it is important that the UK is seen as a safe harbour. Markets will tolerate short-term adjustments to forecasts, including those made by the Office for Budget Responsibility, provided the direction of travel is clear and the policy framework is stable. That is exactly what this Government are now providing.

In my own sector—international financial and professional services—the United Kingdom remains one of the world’s pre-eminent centres. The sector contributes over 12% of our economic output and employs nearly 2.5 million people, with the majority of those jobs outside London. This is not a niche interest or a City concern alone; it is a national asset that underpins prosperity across the whole United Kingdom.

At the heart of that success lies the City of London, which continues to evolve as a global hub for capital, expertise and innovation. The recent wave of mergers between leading US law firms and London-based international firms is a powerful vote of confidence in the UK’s future as a centre for global business. Firms do not make those decisions lightly. They do so because London offers an unmatched combination of expertise, legal certainty, time zone advantage and global connectivity.

Yet we cannot afford to be complacent. Our competitors, from Dublin to Singapore, have been energetic in promoting themselves. In the years following Brexit, the UK was not always seen as the obvious place to launch new products or expand new business lines. Left unchecked, that trend would lead to a gradual erosion of the City’s position and, ultimately, to reduced revenues for the Exchequer and fewer high-quality jobs across the country.

This is why the finance Bill matters. Since 2008, layers of overlapping regulation and sector-specific taxation have placed the UK at a competitive disadvantage. What businesses require is not deregulation for its own sake but clarity, coherence and alignment with international standards, combined with a competitive and clear tax regime.

That is why, as a capital markets lawyer, for example, I welcome the changes to pillar 2 in Schedule 8 to the Bill, which address long-standing ambiguities in the tax treatment of securitisation vehicles and bring the UK into line with other major European jurisdictions. This is a practical, targeted reform that enhances the UK’s attractiveness without compromising standards.

Like the noble Lord, Lord Bilimoria, I want to address the increasingly vocal attacks on London itself. In recent months, a deeply cynical narrative has taken hold—particularly on social media and among some politicians who otherwise wrap themselves up in the flag and claim to be patriotic—portraying London as a crime-ridden dystopia in decline. This caricature is not only inaccurate; it is actively harming our national interest.

To denigrate our capital for short-term political gain is to undermine one of the UK’s greatest competitive advantages. Unfortunately, international investors do not distinguish between rhetoric and reality when headlines travel globally. I therefore urge my noble friend the Minister to ensure that this Government robustly and consistently counter this disinformation through a co-ordinated, cross-government campaign to promote London internationally as the safe and business-friendly city that we all know it is.

Looking internationally, I hope financial and professional services will be central to the UK’s trade policy, including the reset of our relationship with the European Union. But while those negotiations continue, we should focus on what we can control, which is to make the UK an easy and attractive place in which to do business.

The regulatory divergence now emerging between the United States and the European Union also presents us with a strategic opportunity. As the US loosens its regulatory framework and the EU moves towards greater standardisation, we are uniquely positioned to offer a third way, combining high standards with global reach.

In conclusion, the world is looking for centres of stability, integrity and expertise. With the right policy framework, and the approach set out in the Spring Statement and the finance Bill, the UK can and should be that place.