LSE Chief Urges UK to 'Take the Handbrake Off' as Companies Flee London for New York

The head of the London Stock Exchange has issued a blunt warning to the UK government: Britain must do far more to support its own companies or risk watching an accelerating parade of major firms abandon London in favour of overseas markets, particularly the United States.

Dame Julia Hoggett, who leads the LSE, told the BBC that Westminster needs to create a more compelling environment for investment in UK equities, arguing that without structural changes, large British businesses will keep looking abroad to fund their next phase of expansion. Her intervention comes at a moment of growing anxiety about the health of the City of London as a global financial hub.

In an interview with the BBC's Big Boss podcast, Dame Julia said the government should focus on making the UK stock market "more attractive" to investors. She invoked language used by the chancellor and prime minister, who have repeatedly spoken about the importance of backing British business. "If we want Britain to back Britain... then let's make sure that we're creating structural incentives to do so," she said, adding that policymakers need to "take the handbrake off."

The scale of the challenge is considerable. The LSE's main market currently hosts roughly 930 companies with a combined market value of approximately £4.9 trillion. Nearly 40% of those businesses are international, originating from more than 80 countries around the world. That international character has long been a point of pride for London, but it also means the exchange is exposed to fierce competition from other global financial centres.

In recent years, a string of prominent companies have either delisted from the LSE, shifted their primary listing elsewhere, or been acquired by foreign private investors. Takeaway chain Just Eat moved its listing to Amsterdam, travel operator Tui opted for Frankfurt, and Flutter, the parent company of Paddy Power, now trades in New York. These departures have become emblematic of a broader trend that critics say is eroding London's standing.

Perhaps more concerning is the shrinking pipeline of new arrivals. Last year, London hosted just 23 initial public offerings, raising a total of £2.1bn. By contrast, the much larger US capital markets saw 354 IPOs, generating $44bn, equivalent to around £33bn. The disparity underscores how far London has fallen behind New York in the race to attract high-growth companies seeking public listings.

The exodus has coincided with a dramatic surge in UK investment money flowing into US stocks, as British savers and institutions chase stronger returns across the Atlantic. Dame Julia framed this as a paradox at the heart of the national economic conversation. "We talk as a nation about wanting growth in every postcode, but at the moment, a lot of us are funding growth in every zip code," she observed, contrasting British aspirations with American spelling.

She insisted that the raw ingredients for success remain in place. There is "no shortage of great companies and no shortage of capital," she said, pushing back against the narrative that the UK has run out of either. What is missing, in her view, is the confidence and the policy framework to keep that capital and those companies anchored at home.

Part of the problem, Dame Julia argued, is a self-defeating national mindset. Negative sentiment about the UK market, often exaggerated beyond what the data warrants, has contributed to companies choosing to leave. She called on the country to break what she described as a "national habit" of running itself down, urging Britons to "stop throwing shade at ourselves as a nation."

Beyond rhetoric, she is pressing for concrete tax changes. She wants the government to abolish the 0.5% stamp duty that Britons pay when purchasing UK shares, noting that no equivalent tax applies when they buy foreign stocks. That asymmetry, she argues, tilts the playing field against domestic investment and makes London less competitive in the eyes of both issuers and investors.

She also backs the reintroduction of tax credits for Britons who invest domestically, a scheme that existed until 2016 before being scrapped. Such incentives, she suggests, would encourage a culture of homegrown investment and help channel British savings into British businesses, rather than sending them overseas in search of better returns.

The Confederation of British Industry, a major business lobbying group, has echoed these concerns, calling for urgent government action to halt the departure of firms from the LSE. The CBI has advocated for lighter regulation, more effective marketing of the UK as a listing destination, and targeted incentives for investors as the key pillars of any rescue strategy.

Despite the mounting pressure, the government has remained noncommittal about whether stock market reform will feature in its Budget this month. A spokesman said tax decisions are a matter for the chancellor to announce at fiscal events, rather than something to be commented on amid "rumour, speculation or proposals." That response suggests Downing Street is not yet ready to commit to the kind of sweeping changes Dame Julia and others are demanding.

The stakes are substantial. A weakened London market means reduced tax revenues for the Treasury, depressed valuations for British businesses, and a diminished ability for UK companies to raise capital on home soil. If the current trajectory continues, the UK risks ceding yet more ground to New York and other financial centres, with consequences that would ripple through the broader economy.

Dame Julia's message is ultimately a call for national self-belief backed by policy action. She believes the UK has the companies, the capital and the expertise to compete, but only if the government removes the barriers and reverses the incentives that currently favour investing elsewhere. Whether Westminster heeds that call may determine whether London remains a first-tier financial centre or slides further down the global rankings.