IFSC should create 10,000 jobs and change name, report says
Strategy calls for abolishing of Clearing House Group
Create 10,000 new jobs, abolish the sometimes-controversial Clearing House Group, and come up with a new name for the “IFSC” are some of the measures outlined in a new strategy for Ireland’s international financial services sector.
Launched on Wednesday by Minister for State with responsibility for the IFSC, Simon Harris, the strategy marks “a new departure for government in terms of a cross-departmental approach in promoting Ireland as a location for international financial services (IFS) ,” Mr Harris said, adding that, “We’re upping our game in terms of selling Ireland as a location”.
The vision of IFS 2020 is for Ireland to be “the recognised global location of choice for specialist international financial services , building on our strengths in talent, technology, innovation and excellent client services, while focussing on capturing new opportunities in a changing marketplace and embracing the highest standards of governance”.
A key target of the strategy is to increase the level of employment from 35,000 to “at least 45,000” by 2020.
One of the main changes outlined in IFS 2020 is that the public-private partnership model of old, under the Clearing House Group, will go, and will be replaced by a new structure which bifurcates public and private interests.
On one side will be the public sector through a high level IFS implementation committee, chaired by Mr Harris, and including the secretaries general of the Departments of the Taoiseach, Finance, Public Expenditure and Reform, Jobs Enterprise and Innovation, and Foreign Affairs and Trade, as well as the CEOs of the IDA and Enterprise Ireland.
In addition, a small department in the Department of the Taoiseach will be charged with implementing the strategy. On the private sector side will be a new industry consultative forum, the IFS Industry Advisory Committee, which will meet with the public sector arm four times a year. This will “provide a channel for the IFS sector to work closely with and engage with the public sector”.
“It’s a much more appropriate way of doing business,” Mr Harris said of the move.
Also on the strategy’s agenda is coming up with a new name for the IFS sector, a “banner brand” which can be used by those promoting the sector and which will facilitate “a more cohesive approach to the marketplace”.
“Everyone involved in selling Ireland has been doing a very good job, but it’s not a co-ordinated approach. We need a common brand and promotional material,” Mr Harris said.
Another element to the re-branding is the fact that the sector is now a national industry, with between 30-40 per cent of jobs in the sector located oustide the Dublin/mid-east region.
The National Asset Management Agency (NAMA) also has a part to play in the new strategy, by funding the development of Grade A office space in the strategic development zone around the North Lotts and Grand Canal Docks area
An annual IFS summit will also be held in Dublin, akin to the Asian Financial Forum which attracts some 2,600 visitors to Hong Kong. Mr Harris hopes the first such event will be held in Dublin next February.
The strategy also sets out enhanced roles for government bodies such as the IDA, Enterprise Ireland, and the embassy network, while benchmarking is another element of the report.
“We will be producing quarterly strategy reports and it is very much a living document. It’s the start rather than the conclusion of a process,” Mr Harris said.
On specific industries, the green IFSC and Islamic finance are cited as opportunities for growth, while fintech is a sector which Mr Harris is “very excited about”.
“There is a huge opportunity for development of fintech,” Mr Harris said, adding that the focus is not just around larger multinationals but also smaller indigenous companies.
“A key objective is to sustain year-on-year growth in the number of new fintech start-ups,” the report says.
Five strategic priorities:
- Promote Ireland as a location for IFS
- Drive continuous improvement in the operating environment and competitiveness of the sector
- Drive research, innovation and entrepreneurship in the IFS sector
- Develop job-creation opportunities from emerging IFS sub-sectors and new markets
- A new implementation framework for IFS2020
Additional recommendations include:
- The introduction of a year-end progress report, including benchmarking competitiveness
- A securitisation and capital markets forum will examine opportunities afforded by the Capital Markets Union green paper
- Establish an IFS education and skills liaison group
- Promote IFS as a carer choice
- Market the overall opportunity in Dublin’s strategic development zone
- Co-ordinated approach to international promotion of IFSC
- Banner brand for the IFS sector
- Operational metrics for Central Bank
- Identify potential new double taxation agreements
- Build a more cohesive financial technology ecosystem in Ireland and identify sources of funding for fintech companies
- Create a payments forum to co-ordinate sector-wide discussion and review of the payments industry in Ireland
The IFSC in facts & figures:
- 400+IFS companies 200 of which are Irish owned
- 35,000 directly employed - one third outside of Dublin
- Fourth largest exporter of financial services in the EU
- Number one global location for alternative investment funds
- €3.2 trillion of assets under administration
- 50 per cent of the world’s leased commercial aircraft owned or managed from Ireland