Changes to the rules on ISAs are still on the table, Rachel Reeves has confirmed as she laid out wide-ranging plans to strip back red tape in a dash for economic growth.
The Chancellor used her annual Mansion House speech to City financiers on Tuesday to warn that state regulations are “a boot on the neck of businesses”, calling for watchdogs across the economy to take a light-touch approach.
She is keen to boost the economy in order to keep Labour’s promise to make Britain the fastest-growing country in the G7, and avoid the need to keep raising taxes in future Budgets.
But critics have claimed that cutting regulations emboldens banks to behave more dangerously and makes a repeat of the 2008 financial crisis more likely.
Reeves has opted against immediately scrapping cash ISAs or limiting the amount that savers can put into them each year, an idea which had been floated to encourage people who save more than a few thousand pounds a year to put their money into stocks and shares instead.
In her speech, however, she signalled that reforms are still possible in future despite the backlash from savers and smaller financial institutions, which pushed against any curbs on tax-free cash accounts.
The Chancellor said: “I have confirmed that long-term asset funds can be included in stocks and shares ISAs, allowing long-term ISA investors to benefit from this innovative product. And I will continue to consider further changes to ISAs, engaging widely over the coming months and recognising that despite the differing views on the right approach, we are united in wanting better outcomes for both savers and for the UK economy.”
square NEWS Newsletter (£)Why Rachel Reeves can't fix the housing crisis, from a BoE economist
Read More
She called for a major change in how society sees investment, saying: “For too long, we have presented investment in too negative a light, quick to warn people of the risks, without giving proper weight to the benefits. And our tangled system of financial advice and guidance has meant that people cannot get the right support to make decisions for themselves.”
As well as considering an overhaul of ISAs, Reeves has pushed through a law which would allow the Government to force pension funds to put a certain minimum proportion of their assets into British investments.
She said in the Mansion House speech: “Our bill reserves the power to mandate pension funds to invest productively in a wider range of assets, sending a clear signal that pension funds and this government are united in our determination to deliver higher returns for savers and more investment for the economy.“But I am confident that I will not need to use that power, because firms see the urgency and importance of this as clearly as I do.”
As well as announcing laxer financial regulations, for example letting banks offer higher-risk mortgages to borrowers on modest incomes, the Chancellor insisted that “it is clear that we must do more”, adding: “In too many areas, regulation still acts as a boot on the neck of businesses, choking off the enterprise and innovation that is the lifeblood of growth. Regulators in other sectors must take up the call I make this evening, not to bend to the temptation of excessive caution, but to boldly regulate for growth in the service of prosperity across our country.”
Green party co-leader Adrian Ramsay accused Reeves of behaving dangerously, saying: “If in their desperation to achieve growth, the government is willing to set up the conditions for another disastrous financial crash, then we need to question whether growth should be the be-all and end-all of economic policy.”
Mel Stride, the Conservatives’ shadow Chancellor, said: “Reeves should have used her speech to rule out massive tax rises on businesses and working people. The fact that she didn’t should send a shiver down the spine of taxpayers across the country.”
Hence then, the article about cash isa changes still planned as reeves wants your savings on stock market was published today ( ) and is available on inews ( Middle East ) The editorial team at PressBee has edited and verified it, and it may have been modified, fully republished, or quoted. You can read and follow the updates of this news or article from its original source.
Read More Details
Finally We wish PressBee provided you with enough information of ( Cash ISA changes still planned as Reeves wants your savings on stock market )
Also on site :
- Suspected mountain lion attack in Colorado mountains under investigation
- Person falls to death on Boylston Street on New Year’s Eve
- Hazel Avenue in Orangevale closed as suspect barricades in home