Costs for hiring bankers, accountants and lawyers from outside Britain will soar after Brexit and threaten London’s standing as a global financial centre unless the immigration system is urgently reformed, a report said.

The report from TheCityUK, which promotes Britain as a financial centre, and consultancy EY, said that attracting and retaining the best people is a top priority.

“Losing this could undermine Britain’s position as the world’s leading financial centre,” TheCityUK’s chief executive, Miles Celic, said in a statement.

The financial sector is quick to remind the government that it is Britain’s biggest economic sector, raising more than £70 billion annually in taxes.

Applying the current immigration system after Brexit will not work

Other sectors like health and agriculture are also calling for unhindered access to international hiring after Brexit. The government is mindful that many of those who voted to leave the EU in Britain’s 2016 referendum want tougher controls on immigration.

Across Britain 7.5 per cent of banking and related professional staff are European citizens and 4.7 per cent are from non-European countries, rising to 16.9 per cent and 11.4 per cent, respectively, in London where one in four staff in the sector are non-UK citizens.

Banks, insurers, asset managers, and the lawyers and accountants that support them, can currently hire from across EU states without visas, but must use the Tier 2 work visa system for citizens from outside the bloc.

If Britain fails to secure a bilateral agreement with the EU on the movement of people, the sector will have to use the Tier 2 system for all non-British hires.

Applications for certain categories of Tier 2 visas are routinely oversubscribed and rejected due to caps on numbers, the report said.

The resulting increase in visa applications, combined with planned hikes in visa application fees, would result in a 300 per cent rise in costs for hiring international staff, the report said. “Simply applying the current immigration system for non-European citizens to European citizens after Brexit will not work,” Celic said.

Britain could adopt some of the report’s recommendations unilaterally, though some speakers at Monday’s launch cautioned that this could dent UK leverage in future trade talks.

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