The news from Berlin this morning is grim but clarifying. A Tunisian extremist, Anis Amri, has been handed a life sentence for the 2016 Christmas market massacre that left 12 dead. German prosecutors argued he had driven a lorry into the crowd at Breitscheidplatz.
The verdict is a reminder of the human cost of radicalisation, but for those of us watching the spreadsheets in London, it also vindicates a particular approach to counter-terrorism: the British one. Since the July 2005 bombings, Whitehall has poured billions into MI5 and counter-terror policing. The Home Office budget for security has ballooned to £1.
9 billion in 2023. Critics on the left decry the 'surveillance state'. Yet the results are measurable.
The UK has disrupted 39 Islamist plots since 2013. Compare that to France or Germany, where the state's reach is more circumscribed by legal and fiscal constraints. Germany's federal structure, with its labyrinth of Länder competences, has historically struggled to coordinate intelligence sharing.
The BfV (domestic intelligence) and BKA lack the centralised authority of MI5. This inefficiency comes at a cost. The German government spent €43 billion on internal security in 2022, but the yield on that investment is questionable.
The Berlin attack was a systemic failure: Amri had been under surveillance but was released due to insufficient evidence. The life sentence is justice, but it cannot reverse the loss. Meanwhile, the UK Treasury can point to a better return on investment.
Our counter-terror spending, while high, has prevented mass casualty events on home soil since 2005. The cost of a plot is measured not just in lives but in economic disruption. Gilt yields remain stable because markets trust the UK's ability to maintain order.
Capital flight is a risk for nations that appear lax. The pound sterling is not the euro for a reason. Investors know that the Bank of England can keep inflation in check partly because the state has the capacity to enforce internal security.
A terrorist attack in London would spike insurance premiums, depress consumer confidence, and hammer the FTSE. The German verdict may not move the Dax, but it serves as a cautionary tale. Markets hate uncertainty.
They love fiscal discipline and institutional competence. The UK has that in spades, at least on this front. The attacker's life sentence means he will never cost the German taxpayer another euro.
But the broader question remains: will Berlin reform its security architecture to match the efficiency of the City of London? Unlikely. The German constitutional court and the legacy of the Stasi make robust surveillance a political third rail.
So the UK continues to lead, not just in financial services, but in the grim calculus of counter-terrorism. The bottom line: life sentences for terrorists are worthwhile, but preventing the attack in the first place is cheaper.
