Investors call for a competitive Autumn Budget which will aid green transition
Investors are urging the Chancellor to use his upcoming Budget to ensure the smooth transition to the green economy of the future, boost the competitiveness of the UK economy, and support a strong savings and investment culture.
As the country prepares to host COP26, the Investment Association (IA) is calling on the Chancellor to bring forward a series of measures in his Budget that will ensure the UK remains a leading international financial services hub, and allow the investment management industry to play its part in the global fight against climate change. These include:
Building on the delivery pathways outlined in the Treasury’s Net Zero Strategy, to develop clear, long-term sector-specific net zero transition plans. Further detail on these pathways is needed if the investment management industry is to support transition in different sectors of the economy and factor climate risks more accurately into investment decisions.
Working with the investment management industry to identify specific sectors or projects which align with the goal of net zero transition and where additional investment is needed. This could focus on sectors, nascent technologies, or underdeveloped overseas markets, and should consider appropriate mechanisms to crowd in private finance.
Supporting long-term investment and broadening investor access to long-term, illiquid assets, both in the UK and globally. The Long-Term Asset Fund (LTAF), which the IA pioneered, needs to have a broader distribution within the retail market than currently envisaged under the FCA’s draft rules.
Creating a supportive regulatory culture, with competitiveness hardwired into it. The UK is in a unique position to update its regulatory framework following the UK’s departure from the EU and ensure that it remains appropriate to meet the social, economic and geopolitical challenges that lie ahead.
Ensuring that the UK has a tax regime that is competitive, stable and predictable, so that businesses have the confidence to make long-term decisions.
Protecting the UK’s international outlook so that world class investment talent continues to bring their expertise to the UK - one in five of those employed in UK investment management are international, and this gives the UK a key competitive edge.
Allowing UK capital markets to thrive, which play a vital role in advancing opportunities for both investors and businesses. This must be underpinned by continual improvement to the UK’s stewardship and corporate governance practices.
Chris Cummings, Chief Executive of the Investment Association, said: “This is a vital budget. As we emerge from the pandemic and accelerate towards a greener economy, action and clarity from the government is critical in order to ensure every corner of our country thrives.
“As we look ahead to COP26 next month, we hope to see further measures announced by government to aid the UK’s green transition. Underestimating the severity of climate change will undermine the basis on which our economy, businesses and jobs are founded. The investment management industry recognises we must change course now in order to protect the savers we serve. UK savers put almost £1bn a month into responsible investment funds last year, showing how important investing in a way which supports our communities has become.”
For the full submission, see here.
For further information, please contact:
Katie Martin, Head of Communications: [email protected]
T: +44 (0)20 7269 4655
Camilla Esmund, Communications Executive: [email protected]
T: +44 (0)20 7269 4625
IA press office: [email protected]
T: 020 7269 4696
About the Investment Association (IA):
- The IA champions UK investment management, supporting British savers, investors and businesses. Our 270 members manage £9.4 trillion of assets and the investment management industry supports 114,000 jobs across the UK.
- Our mission is to make investment better. Better for clients, so they achieve their financial goals. Better for companies, so they get the capital they need to grow. And better for the economy, so everyone prospers.
- Our purpose is to ensure investment managers are in the best possible position to:
- Build people’s resilience to financial adversity
- Help people achieve their financial aspirations
- Enable people to maintain a decent standard of living as they grow older
- Contribute to economic growth through the efficient allocation of capital.
- The money our members manage is in a wide variety of investment vehicles including authorised investment funds, pension funds and stocks and shares ISAs.
- The UK is the second largest investment management centre in the world, after the US and manages over a third (37%) of all assets managed in Europe.