City 'must move to stay ahead'

London will lose its status as the world's top financial centre unless urgent action is taken, Boris Johnson's new City adviser says today.

Bob Wigley, a senior Merrill Lynch banker and leader of a new protection squad assembled by the Mayor, has warned that changes are needed to prevent complacency and keep the capital at the top of its game. He says his team, comprising London's most important finance chiefs, will look at expanding markets in the Middle East and other international centres to measure the City's success.

"This isn't about London versus New York," he said. "It is about the fact there are three or four leading financial centres now and we need to be sure London is one of them.

"It will involve looking at how the Middle East and Far East are growing so fast, to keep London one step ahead.

"London isn't facing a crisis but we must not get complacent. Other markets are moving fast and rather than just watching, we need to stay on guard and change things so we can stay ahead and in the top three."

The crack team contains members of a similar body which guided Gordon Brown as chancellor. They include Barclays Chief Executive John Varley, KPMG Chairman John Griffiths-Jones and Andrew Moss of insurance group Aviva.

Insiders say unnecessary taxation and regulation which are stagnating financial institutions will be at the top of the group's hit-list.

They also say the group are determined to stay free from lobby influence and will offer neutral apolitical expertise on what they individually think is best for the Square Mile.

Mr Johnson said: "I am keen this group makes clear recommendations. It is vital the capital retains its competitive edge."