The former Bank of England’s top economist has called for “boldness” from the Government to boost investment in UK companies and help stop the exodus of British-listed firms abroad.
Andy Haldane – chief economist at the Bank until 2021 and now president of the British Chambers of Commerce (BCC) – says the Government must take action to shift investment into UK businesses by “deploying the huge stockpile” of savings, pension and investment fund cash “more effectively”.
He added: “UK households hold financial assets of around £9 trillion, more than enough to finance business Britain, but right now only a tiny sliver of that £9 trillion is being recycled into supporting British business.
“Only around five per cent or less is making its way into nourishing British businesses.”
Mr Haldane – speaking at the British Chambers of Commerce’s global annual conference in London – also said other countries have a “home bias” towards investing in their domestic companies.
He added: “The UK’s pension fund system, big and mature, is the only pension system in the world on the planet that does not have such a home bias towards British businesses, it’s the ultimate irony that Canadian, Dutch, Australian pension funds invest more in British companies than do British pension funds.
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.”
In his speech, Mr Haldane also said the UK risks losing more valuable companies overseas unless it makes the UK more attractive and bolsters investment in British businesses.
There has been a flurry of UK firms switching their primary listings overseas in recent years, including big names such as Paddy Power owner Flutter Entertainment, which now plans to quit the London market altogether.
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