Yes vote is critical if Ireland wants to maintain its influence, shape financial services rules and compete for pan-European business, says Paul McGowan

Earlier this week a number of people - including myself - who are working directly or indirectly in the International Financial Services Centre established a group - IFSC For YES - to campaign in favour of a Yes vote in the forthcoming Nice referendum.

As a group, active politics is not something most of us are particularly familiar with. So it's hardly surprising that the most frequent reaction we've received so far is Why?

Why have we set up the group and why should we - as IFSC people - support Nice?

The first question is easy. Anyone who observed the last Nice referendum can see the failure of people who benefited from EU membership, or who would benefit from the Nice Treaty, to campaign for a Yes vote.

This left the stage to those who were opposed to Europe to generate all kinds of hysteria and laid the seeds for a rejection of the treaty.

As for the second question - why should IFSC people support Nice? The answer is equally clear. The Nice Treaty is good for the IFSC and good for the Irish economy.

Ireland is now a European and international financial centre. There are now nearly 500 international financial services companies operating from Ireland. The IFSC has spread from Dublin's north quays to Galway, Kilkenny and Wexford.

More than 11,000 people are now directly or indirectly employed in Ireland through IFSC businesses.

From a zero start, and against some scepticism, we have grown to provide world class services in:

international investment funds, where 5,000 people provide services to 1,000 Irish funds and international funds, keeping track of more than €500 billion in assets;

international banking, with more than half the world's top 20 banks and more than €200 billion in bank assets located here;

life assurance and international captive insurance management, with a total of 92 companies licensed to write insurance or reinsurance;

stock exchange listing of investment products and specialist securities, as one of the top two exchanges for these services in Europe.

There are thousands of jobs in accountancy and professional services firms which owe their existence to IFSC activity. Specialist third-level courses have been developed to cater for the training and education needs in funds, banking and finance.

We did this by working effectively within Europe since 1987, in a unique common commitment between public and private sector.

The EU Commission approved the initial special 10 per cent rate for Dublin's financial services centre. We developed common European financial services rules for investment funds and services.

Ireland worked with other member-states to reach mutual agreement on particular tax issues.

We agreed the transition from the 10 per cent special tax rate to the national 12.5 per cent rate. This allowed international financial services to be set up in the regions.

Ireland secured the right of member-states to set their own corporation tax rates, a key part of the Nice summit.

In the forthcoming referendum, we are being given an opportunity to re-commit ourselves to Europe. And to sustain our influence there.

From an IFSC perspective, this continued influence is critical. Ireland must be able to shape new financial services rules to open opportunities for us and to allow us compete for pan-European business.

If we are perceived to be less significant to Europe, our influence will diminish as other states forge ahead without us and we will become less attractive for investment from countries seeking a European base.

The Nice Treaty itself does not contain new proposals to complete and deepen the single market in financial services.

That work is already well under way in the EU Commission's Financial Services Action Plan. Consumers and businesses across Europe will benefit from greater transparency and ease of use of cross-border financial services.

There is a good way to go for a lot of services, but Ireland will stand to gain greatly if we continue to be a competitive and top class centre for servicing this business.

The bottom line: A Yes vote is the only way forward for our jobs and for Ireland.

Paul McGowan is a tax partner with KPMG and a member of the IFSC For YES Group.