Mark Boleat: The Single Market is crucial for London’s prosperity

London’s success as a global financial centre and the benefits it brings are fundamentally linked to our ability to access the Single European Market. As the debate on Britain’s EU membership intensifies, it is time the City made the case for how this market of 500 million consumers underpins jobs and growth.

The defining characteristic of our financial and professional services industry is its international outlook. We are home to more than 250 foreign banks — more than any nation in the world — with a third from the eurozone. There are more than 200 foreign law firms with offices across the country, the largest legal services market in Europe. The UK insurance industry is also the biggest in Europe.

These figures matter more than ever at a time of austerity. The reason major international institutions base their operations in London is because we serve as a gateway to Europe and, by extension, the world.

The Single Market is at the very core of our business. It is imperative that the UK continues to have full access to it, whatever shape our future relationship with Europe may take.

Some have suggested we could adopt the model employed by Norway or Switzerland. Even were this on offer, there would be a major trade-off. While the headline figure contributed by the UK to the EU might drop, there would be a commensurate fall in our influence over regulation affecting us.

The City of London Corporation recently published research showing that about 40 per cent of Swiss legislation is autonomously derived from EU regulations. This figure is likely to rise as non-EU members have to amend their parallel legislation in order to maintain equivalence.

And if the UK had been in this position, we would have been unable to secure the non-discrimination provision as part of the banking union deal last December. Nor would we have any influence over the potentially damaging financial transaction tax, which could add £4 billion to the annual cost of financing UK government debt.

That is not to say that the EU or the Single Market should be frozen in aspic. The Prime Minister has rightly set out a vision for reforming them.

From the City’s perspective there are three areas where the UK could take a lead. First, the Government should explore how the Single Market in services can be further liberalised. Second, we need to convince European policymakers that a more flexible and competitive approach benefits not just London but the Continent as a whole.

Last, and most crucially, the UK needs to engage more effectively in the Single Market’s legislative process. We need a better relationship with the European Parliament and more Brits in the European Commission. In the short-term this is just as important as high-level debate over Europe’s future.