Former Bank of England chief economist Andy Haldane has called for "boldness" from the Government to boost investment in UK companies and help stop the exodus of British-listed firms abroad. Speaking at the British Chambers of Commerce (BCC) global annual conference in London, Haldane urged action to shift investment into UK businesses by deploying the "huge stockpile" of savings, pension, and investment fund cash more effectively.
Huge Stockpile of Household Assets
Haldane noted that UK households hold financial assets of around £9 trillion, more than enough to finance business Britain, but only a tiny sliver is being recycled into supporting British business. He stated, "Only around 5% or less is making its way into nourishing British businesses."
Lack of Home Bias in UK Pension Funds
Haldane highlighted that other countries have a "home bias" towards investing in their domestic companies, but the UK's pension fund system is the only one in the world that does not have such a bias. "Canadian, Dutch, Australian pension funds invest more in British companies than do British pension funds," he said.
Tax System Changes Needed
Haldane emphasized that changes would be required not only in pension fund investing but also in the tax system. He said, "If the Government wishes to act at speed and scale, and it surely needs to do both of those things… it will require this level of boldness of thinking."
Risk of Losing More Companies
Haldane warned that the UK risks losing more valuable companies overseas unless it makes the UK more attractive and bolsters investment in British businesses. He noted that the UK has lost over 100 listed companies with a market cap in excess of £100 million since 2024, including big names like Paddy Power owner Flutter Entertainment, which plans to quit the London market altogether. "We simply cannot afford to allow the continuation of overseas stripping of our greatest growth asset… on this scale," he concluded.
