Labour front benchers have urged the government to work with the opposition, business and trade unions to protect British interests from planned European regulation of the pensions and insurance industries.
Shadow chief secretary to the Treasury Rachel Reeves and shadow business secretary Chuka Umunna (pictured) warned of the impact of the European Union (EU) plans in a joint letter to their counterparts in the cabinet Danny Alexander and Vince Cable.
They warned that the proposed overhaul of the Institutions for Occupational Retirement Provision (IORP) Directive would divert hundreds of billions of pounds from British businesses and deter pension funds from investing in the UK.
The letter added that the Solvency II directive for insurance companies could damage the international competitiveness of the UK insurance industry and reduce investments in infrastructure.
Reeves said: "In the wake of the global financial crisis it is vital that financial services, including the pensions and insurance industries, are properly regulated to ensure stability and good governance, but this must not have the perverse consequence of hindering investment in the essential infrastructure and productive businesses that must be the foundation of our future prosperity."
Reeves and Umunna called for a full report on the assessment the government has made on the threat to the UK economy.
They also urged the government to build alliances in the European Parliament and with other member states concerned about the impact of the regulation.
They asked: "What action is the government taking to bring together the wide interests that have concerns about the proposals, to put the UK's case most effectively - not sabre-rattling for sabre-rattling's sake, but a constructive engagement to get the best outcomes for the UK?"
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