City sets out to show it's doing a good job

The City of London is going on the counter-attack against its critics with the launch of a study on the contribution financial services make to the British economy.

Christopher Walford, the Lord Mayor, said: ``The City brings great benefits to the nation. It concerns me that it is so poorly regarded in the country at large.''

The move comes after a series of assaults on the financial services industry, culminating in the recent attack on the banks by Gordon Brown, the shadow Chancellor. The Labour Party's traditional hostility to the City has been reinforced by last year's scandal over pension transfers and the disclosure this year of high commissions on life assurance sales.

Even traditional supporters have hinted that all is not well. Last summer the Treasury carried out an inquiry into the financing of industry which prompted Stephen Dorrell, then Financial Secretary, to suggest the pressures of the stock market forced companies to make excessive dividend payments during the recession.

The City Corporation is also concerned about the growing power of pressure groups such as anti-bank campaigns or the small-business lobby.

The new research project, to be carried out by London Economics, an independent consultancy, will cost £30,000 initially but could become much bigger. It follows the completion of the £1.3m City Research Project, which looked at London's international competitiveness as a financial centre. Its final report is due to be published next month.

The latest study will look at areas where the City' performance has been under attack. These include the financing of growing companies, attracting inward investment to Britain, providing long-term finance to industry, and the funding of pension provision.