Nicky Morgan MP, chair of the Treasury Committee, urged ministers to provide clarity.

Her comments came after John Glen MP, Economic Secretary to the Treasury, told her in a letter that the Government, "must carefully consider the timing of any publications that could be used to undermine the UK's negotiating position."

But Ms Morgan responded: "Nothing undermines a negotiating position more than not having one. The Government should publish its position paper on the future of financial services immediately."

She said: "By publishing a position paper on financial services, the Government could articulate a clear sense of direction and provide some much-needed clarity. Yet, as the Economic Secretary confirms, the Government is refusing to publish such a paper for fear of undermining the UK's negotiating position.

"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.

"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. Financial services firms will be seriously concerned at the chronic state of uncertainty."