Chancellor Rachel Reeves has called for an end to the “negative” narrative around investing for growththrough stocks and shares. Speaking at the Mansion House dinner, she argued that excessive caution has discouraged savers from capitalizing on economic opportunities.
Reeves emphasized that financial advice often overstates risks while downplaying rewards. Consequently, many Britons keep savings in cash ISAs rather than exploring higher-growth investments. Currently, £300 billion sits in these low-risk accounts.
To encourage investing for growth, the government is collaborating with the Financial Conduct Authority (FCA). Together, they plan to introduce targeted support for new investors before the next financial year.
The UK economy shrank in May, adding pressure to stimulate growth. Meanwhile, speculation about potential tax rises looms after recent U-turns on welfare and winter fuel payments.
Former Lord Mayor Sir William Russell warned that uncertainty could unsettle markets. However, he dismissed rumors of a wealth tax, calling the government “more sensible than that.”
Historically, governments have promoted share ownership. In 1986, the “Tell Sid” campaign encouraged Britons to buy British Gas shares. Similarly, the 2013 Royal Mail IPO aimed to boost public investment.
Reeves aims to revive this spirit of investing for growth. She assured that ISA reforms remain under consideration, with consultations planned in coming months.
While investments can lose value, inflation erodes cash savings over time. Reeves stressed that well-informed decisions allow savers to benefit from economic success.
She also criticized excessive financial regulation, calling it a “boot on the neck” of innovation. Bank of England Governor Andrew Bailey acknowledged the need for modernized rules but cautioned against destabilizing changes.
Reeves joked about her challenging start as Chancellor but reaffirmed her commitment to growth-focused policies. With new investor support and regulatory reforms, the government hopes to unlock capital for businesses and fuel long-term prosperity.
The focus on investing for growth marks a pivotal shift in economic strategy. As consultations progress, the goal remains clear: empower savers, energize markets, and drive the UK economy forward.
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