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UK could lose £10bn a year in City-related tax revenue after Brexit

A leading City figure whose former role involved governing the Square Mile has said Brexit could result in the loss of 75,000 jobs and up to £10bn in annual tax revenue.

Sir Mark Boleat, who was chairman of the City of London Corporation until last year, said a seepage of jobs from the capital was already underway and that the political rows over a deal or no-deal outcome was now “irrelevant” to City chief executives.

Banks including JP Morgan, Lloyds, Barclays, HSBC and Goldman Sachs have already established subsidiaries in other EU countries, or moved part of their business because EU law requires them to be legally compliant from the day the UK leaves.

“It is no longer contingency planning. If you are running a bank it is non-negotiable. The regulators won’t allow it,” he said.

In an interview with Advisory Excellence before a keynote speech on Wednesday at the Cass Business School in London, Boleat said the City would not die as the financial capital of Europe but would be damaged by Brexit.

“These moves are bad for London, but they are also bad for the EU because they will make financial markets less efficient,” he said. “Financial services will be fine, but I would say if the City has 80% of international business now, in future it will have maybe 60%.”

Boleat said Brexit has prompted expensive and unwelcome processes and the damage would be seen over the decade to come.

“This is a 10-year operation. In the short term it won’t be noticeable in terms of staff. Banks won’t be putting out press releases saying they are moving some of their operations because of Brexit because they don’t want the publicity. They are just getting on with it.

“Moving costs millions. Banks have had teams of 100 working on Brexit. It is an expensive process. You have to identify which city to go to, applying for a [banking] licence costs millions, then you have to find the IT staff, find accommodation.”

He also believes the government is in such disarray that the Brexit deal will be pushed back to December, leaving business planning elsewhere perilously close to exiting the EU.

In his address, Boleat will say he does not think financial services will get a special passporting deal to allow them to continue pan-European services from London and that banks are already past that moment of truth, whatever politicians think.

“Those who suggested that some business would move were accused of scaremongering,” he will say before listing 15 major banks and financial services who have already set up on the continent or Dublin.

He will quote a report by the Oliver Wyman consultancy that says if the UK strikes a deal giving full market access, the impact on the City would be modest, the equivalent of 3,000-4,000 jobs and a loss of £500m in tax a year to the Exchequer.

“At the other end of the spectrum if the UK had no special status with the EU, now the most likely option, the industry would lost £18bn a year in revenue which would put 31,000 to 35,000 jobs at risk along with £3.5bn to £5bn in tax revenue.”

Add the knock-on effect for related industries and the loss of entire business units, there is an estimated further losses of £14bn to £18bn in revenue and 34,000 to 40,000 jobs and £5bn in tax.

Asked whether the government was aware of the daily bleed of financial services to the rest of the EU, Boleat said: “Not enough, that’s the worry. It needs business to talk to MPs, not to give their view on Brexit, but to explain to them ‘this is what I am having to do because of Brexit’. This is not scaremongering, this is reality.”

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The best consulting firms for Healthcare, Pharma and Life Sciences

The healthcare consultancy industry comprises of a handful of global firms and huge array of small/boutique to medium size firms that specialise exclusively in this area focusing their efforts across the whole value chain, from R&D to product launch, whilst others may focus on a specific portion of the lifecycle.

As the National Health Service continues to seek out savings opportunities while the government remains reluctant to up spending on the institution and, as health insurance and pharmaceutical costs threaten to spike in the near future, consulting firms are in demand in both the private and public sector to help the health industry negotiate the issues of the day. Now, a new survey conducted by professional services firm IgeaHub has revealed which consulting companies are considered the best in the healthcare space.

Following a large polling process among life science and healthcare industry executives, researchers, investors, health policymakers and patient advocates in 2017, the researchers found that QuintilesIMS – recently rebranded as IQVIA – McKinsey & Company, ZS Associates, Accenture and Deloitte provide the best consultancy services in the healthcare and pharmaceuticals landscape.

The best consulting firms for Healthcare, Pharma and Life Sciences

American multinational IQVIA, formerly QuintilesIMS, works to serve the combined industries of health information technologies and clinical research. The firm, which rebranded in November 2017, boasts approximately 55,000 employees in more than 100 countries. Last summer, the firm entered into a strategic collaboration with the NHS Cancer Vanguard, with a view to contributing its anonymous patient level, real world data on drug usage treatment costs and outcomes, in order to extend the capabilities of the national body.

Second placed McKinsey & Company and fifth placed Deloitte were both recently named top healthcare consultancies for the UK by Statista and the Financial Times. McKinsey reportedly struck a lucrative deal with NHS Improvement for a new partnership to “develop our internal organisational development work”, and to clarify NHS Improvement’s “purpose and operating model” – according to the Health Service Journal. Deloitte was meanwhile a recipient of several accolades at the most recent HealthInvestor awards.

Professional services firm Zs ranked third. The company’s Medical Products and Services practice provides a wide range of sales and marketing consulting, outsourcing and technology offerings to medical device and diagnostics companies as well as those specialising in medical supplies, equipment, distribution and healthcare services. The firm counts household healthcare names such as Astra-Zeneca, Bayer, GE Healthcare and Pfizer among its clients. Multifaceted IT and advisory firm Accenture meanwhile positioned fourth. Accenture recently published research suggesting that by making the overall healthcare industry more efficient, artificial intelligence applications could create $150 billion in annual healthcare savings in the US by 2026.

Rounding off the top ten, BCG – which appointed a new Associate Director for its Healthcare practice in the form of Chris Bergstrom – Clearview, Navigant, PwC, the Advisory Board Company all ranked highly among healthcare executives. Founded in 2007, ClearView Healthcare Partners is a global strategy consulting firm serving the life sciences sector, while Navigant has been working to expand its health offering over a number of years – including the acquisition of services provider Revenuemed. Big Four firm PwC has one of the largest healthcare networks advising clients – including policy makers, healthcare providers, payers and health sciences – to meet the challenges of addressing value, new entrants and new global markets, while the Advisory Board Company recently sold its healthcare assets to Optum, part of UnitedHealth Group, in a deal worth $1.3 billion including debt.

Rounding off the 20 firms named by IgeaHub, Big Four member EY ranked 11th; with Huron, which recently acquired HSM Consulting, L.E.K. Consulting, which recently boosted its healthcare wing with three new senior staff; international strategy firm Bain & Company, and global management consultancy FTI Consulting. Concluding the list were Chicago-based The Chartis Group, life-sciences and health strategy specialist Health Advances and Kaiser Associates, a boutique strategy consulting firm based in Washington DC and London, as well as Marsh McLennan Companies subsidiaries Mercer and Oliver Wyman.