THE UK Government's refusal to publish a Brexit paper on the financial services industry has been condemned by a former Cabinet Minister, who insists it will only add to the “chronic state of uncertainty” for business.

Nicky Morgan, who chairs the influential Commons Treasury Committee, said "the clock is ticking" for the vital sector and called for a position paper to be published immediately.

In a withering response to the Treasury, which has refused to publish a paper, Mrs Morgan said: "Nothing undermines a negotiating position more than not having one."

John Glen, the Economic Secretary, has written to Mrs Morgan setting out the Government's position, insisting that it would not publish anything which could undermine the Brexit negotiations.

"It is important to be cognisant of the fact that the UK's intentions for our future relationship with the EU form an integral part of our negotiating strategy.

"Negotiations are highly sensitive and we want to secure the best possible outcome, including for our financial services industry," he explained.

Mr Glen went on to tell Mrs Morgan: "We must carefully consider the timing of any publications that could be used to undermine the UK's negotiating position."

In January, David Davis, the Brexit Secretary, told MPs: "We may well publish on financial services. I suspect we will publish something and we are certainly going to have a lot of public debate about it."

In her response to Mr Glen's letter, the committee chairwoman said: "The clock is ticking for the financial services industry.

"Many firms will begin to activate their Brexit contingency plans at the end of March, but they're still none the wiser about the Government's desired end-state for the sector.

"By publishing a position paper on financial services, the Government could articulate a clear sense of direction and provide some much-needed clarity.”

Yet she noted the Treasury was refusing to publish such a paper for fear of undermining the UK's negotiating position.

"Nothing undermines a negotiating position more than not having one,” she declared.

"Clarity has been provided for numerous other sectors, so the more than one million people employed in financial services will take no comfort in the Government's inaction.”

Mrs Morgan added: "Financial services firms will be seriously concerned at the chronic state of uncertainty. The Government should publish its position paper on the future of financial services immediately."