Don’t force us to invest in Britain, City warns Labour
Biggins argued that instead of forcing schemes to invest in U.K. assets, the government needs to better incentivize investment in British companies.
“While global equities have outperformed U.K. stocks in recent years, the solution lies in incentivizing investment in U.K. productive finance through measures like reinstating the dividend tax credit or scrapping stamp duty [on share trading]— not through compulsion,” he said.
The Capital Markets Industry Taskforce, a group of firms advising on capital markets reforms, has already called for the government to scrap penalties for trading U.K. stocks and shares.
It warned that the U.K. had fallen behind its economic peers in the G7 due to decades of underinvestment and needs to drive billions into key areas like housing, water, energy and venture capital that helps startups grow.
A Treasury spokesperson cited figures from Peel Hunt, which state that U.K. pension funds invested around 44 percent of their capital in U.K. equities in 1998 — compared to only around 4 percent today.
“We want to unlock more investment to help grow the U.K. economy and deliver better returns for savers,” the spokesperson added. “The pension review is looking at ways to achieve this in an effective way by working closely with the pensions industry.”