The Great British PAC is launching the Great British Savings Plan, and we want it written with your help. Our aim is to crowdsource the government policies and tax breaks that would reward and encourage Britons to invest in our own economy – and to do that, we need to hear what you think should be in it. Head to our Policy Platform and add your ideas there.
You can find the discussion here: Help GB PAC Create a Great British Savings Plan For British Savers & Investors (please add your ideas in the Comments) – Economy – Policy Platform UK.
Strip away the noise and most of today’s political argument comes down to one divide: between those who would paper over unsustainable problems with short-term fiddles, and those willing to actually solve them whatever the near-term disruption. That fault line runs through almost everything – Brexit, immigration, tax, welfare, pensions, crime, the NHS, and most recently the bailout of British Steel.
Seen this way, Donald Trump has a point, and British voters appear to sense it. Whatever you make of his style and communication, the president is being blunt about something true: America cannot keep subsidising the rest of the world on security, trade and aid by piling up crushing debt. His message is that every country must fix its own problems and stand on its own two feet.
Britain suffers from the very same structural weakness as the United States, but lacks the mindset to confront it. Our generosity to the wider world is funded by a falling quality of life at home and ever more unsustainable borrowing.
Three decades on, that model has run its course. As Trump pushes back, Asian nations will be forced to sell down Western assets to prop up their own economies, while Europe prepares to borrow trillions for a new defence pact. We can no longer outsource our saving to others.
Nor should we want to, because the costs of our ‘buy now, pay later’ habit are plain to see. Carrying so much debt, we now lurch into economic crises – the GFC, Truss, Reeves – every time the markets doubt our ability to pay. Sooner or later one of those mini-crises will not simply blow over. That is when we reach Greek-style economic Armageddon, with all the human cost it brings.
The same failure to save shows up in our crumbling infrastructure, our housing shortage and our shrinking stock market. British fixed capital investment has trailed its G7 peers since 1990, and we sit bottom of the pile for corporate investment too. A tax-and-spend economy simply leaves us without the capital, or the incentives, to invest in infrastructure or growth.
The consequences for our sovereignty are enormous. During Rachel Reeves’ mini-crisis, the Chancellor’s first move was to fly to China, cap in hand. When we cannot save for ourselves, our lenders – be it the EU, China or the globalist consensus – get to call the shots. That makes a mockery of Brexit and of what the public have repeatedly demanded: an independent UK run by people acting in the country’s interest. If we have no wish to be a vassal state along the lines of Greece or Sri Lanka, we need our own money.
A savings culture matters for more than national sovereignty; it underpins personal freedom and wellbeing. Money – for a nation as for an individual – means choices. A poor and indebted population has little agency to fix its own problems. Debt, indeed, is among the most common causes of mental health problems, including suicide. As Dickens famously put it in David Copperfield:
“Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”
The case for reviving a domestic savings culture is, in short, overwhelming. Yet Reeves appears to be heading the wrong way. Government borrowing is climbing fast, and the Chancellor is straining to dilute the prudent lending rules put in place after the financial crisis.
More debt may deliver a short-term sugar rush, but it is not good-quality, sustainable growth. Borrowing is simply taking from the future – from our children and grandchildren – to buy an easy fix today, and it leaves us poorer and more exposed to the next shock.
Worse still, this government has gone after savers from every direction, vindictively targeting investors and pensioners. As a recent tweet from Rob Moore noted, with taxes this lopsided it is little wonder that wealthy entrepreneurs and prudent savers are leaving in droves. His like-for-like comparison of Dubai and the UK is stark:
- Income tax: Dubai 0%. U.K. 45%
- National insurance: Dubai 0%. U.K. 15%
- VAT: Dubai 5%. U.K. 20%
- Corp tax: Dubai 0% to 9%. U.K. 19% to 25%
- Capital gains tax: Dubai 0%. U.K. 10% to 28%
- Inheritance tax: Dubai 0%. U.K. 40%
- Property tax: Dubai 2%. U.K. 5% to 12%
Punishing wealth means money made in Britain is now flowing abroad – and that is, quite literally, an existential threat. The Adam Smith model on which Western prosperity rests depends on profits being reinvested. Without that, as Smith himself made clear, capitalism does not work.
To be fair, none of this is Reeves alone; our savings crisis has been thirty years in the making. Gordon Brown, Balls, Osborne, Sunak and Hunt each played a part. Investing in this great country has grown too complex, too punitive, too expensive and too uncertain – and look at the state we are now in.
For the sake of national renewal it is imperative that we launch a Great British Savings Plan, built to encourage and reward long-term British saving and investing. Now is the moment to become a nation of savers.
This is essential if we are to make the most of our post-Brexit sovereignty. Our Brexit freedoms let us build a new, low-cost, simplified model designed around savers.
And that is where you come in. We want your ideas on what a Great British Savings Plan should contain – cutting the costs and bureaucracy of the investment industry, tax cuts, simplification, merging pensions and ISAs, or anything else you can think of.
Whatever your big idea, please take it to our Policy Platform and add it below by clicking ‘Reply’ at the bottom. The link is here: Help GB PAC Create a Great British Savings Plan For British Savers & Investors (please add your ideas in the Comments) – Economy – Policy Platform UK.
All ideas are welcome. The more original, the bolder and the simpler, the better. We will share the result with all parties, and already have interest from the Conservative Party leadership.