Financial services firms should start planning now to comply with the EU’s Markets in Financial Instruments Directive (Mifid), which is due to come into force in November 2007. Failure to do so could leave firms facing higher wage bills as they compete for staff with the skills to put the correct policies and procedures in place, or relying more heavily on costly external consultancies, according to IT services provider Zeda.

One aim of Mifid is to get banks to reduce the barriers to trading in the UK, by creating more trading venues outside of the London Stock Exchange. But this will create the need for "a whole lot of back office systems and procedural changes", according to Steve Tomlinson, services manager at Zeda.

"The message is that firms need to start ASAP," Tomlinson warned. " Organisations can take steps to ensure their delivery methods and testing [processes] are robust enough and to identify where they're vulnerable [to staff losses]."

Some firms are delaying implementation because many of the requirements of Mifid are still unclear, but if they plan ahead, they will stand a better chance of complying on time and to budget, Tomlinson added. "[Specialist] IT staff salaries will skyrocket, because it is such wide-ranging legislation," said Tomlinson. "And because the EU has [around] 40 [pieces of] compliance [legislation] upcoming, getting it right now will make subsequent compliance issues a lot easier."