Vision for Economic Growth — a roadmap to prosperity 9 representatives from industry alongside government Executive summary Government Pension Schemes (LGPS) increase their and regulators, could help design and implement allocation to unlisted equities to 10% (which the the strategy. government is consulting on at time of publication), and if UK DC schemes allocate at least 5% of their Raise investment levels 17 Reforms to Solvency default funds to unlisted equities. For greater prosperity and growth, the UK needs II could potentially unlock £100bn from the insurance higher long-term returns for savers and more and long-term savings sector over the coming decade 18 Capital will only 昀氀ow if these regulatory investment in its 昀椀rms and infrastructure to from 2024. create high quality jobs. The UK’s FPS 昀椀rms are reforms are accompanied by profound cultural change. leaders in providing capital to 昀椀rms and projects In addition, there will need to be a signi昀椀cant increase in savings levels into DC retirement schemes. globally. Deploying this expertise more consistently at home will pay dividends. It has the potential Big move #3: maximise the effectiveness of every to improve returns for long-term savers, provide capital for businesses to pursue new opportunities, pound of government support for growth companies. Government deploys 昀椀nancial support across the and create compelling investment options for international investors. economy, nationally and locally. Clarifying how these disparate funding schemes align to major strategic Big move #2: fully implement a programme of change outcomes would provide strong signalling. The clearer These objectives are delivered through a series of Nearly everyone in the UK interacts with 昀椀nancial for UK pension and insurance funds. These reforms the priorities, the greater the chance of leveraging in and professional services (FPS) on a daily basis. For “big moves”, or strategic reforms, that are designed private capital. Operationally, 昀椀rms also 昀椀nd it di昀漀cult will bene昀椀t long-term savers while also supporting some consumers, those dealings may consist of daily to create transformational change over time. Often growth companies, infrastructure, and the wider to navigate the opportunities. This could be made much purchases using a credit/debit card or keeping money they amplify existing recommendations and calls for economy. Government should progress the reforms more user-friendly with a “product and institution-neutral” securely in current accounts. For others, it is about change that have been brought forward by various for which there is strong and broad ranging support. advisory team and portal that would help 昀椀rms navigate milestone events such as taking out insurance for a new industry bodies, government reviews, and civil society the choices available to them. There is also an opportunity This includes Solvency II reform and a new Value for car, a mortgage for a new home, or a savings product to organisations. We expect these big moves to deliver to explore creating investment vehicles that could provide Money framework for de昀椀ned contributions (DC) 19 prepare for retirement. Individuals and businesses may even bigger impact than the numbers suggest as the a destination for long-term capital. schemes. Government has indicated that up to £75bn seek investment advice, legal expertise, or other forms bene昀椀ts they will provide reach far beyond FPS. Through in private capital could be unlocked by 2030 if Local of professional services. FPS supports UK businesses the role of FPS as an enabler, we believe these initiatives to stay on top of their 昀椀nances, invest in order to drive will deliver a signi昀椀cant knock-on impact on overall productivity, manage risk, and create jobs in the UK and growth for the UK economy. abroad. Regardless of the speci昀椀c interaction, FPS boils down to ensuring people can get through good times Support the conditions for growth Government, regulators, and the industry must support and bad, and plan for the future. It is vital that we have an industry that supports consumers and businesses the conditions for growth. This is about getting the basics right across the country and through all stages in right. Some conditions, such as world-class infrastructure, their lives. apply to the whole economy. Others are speci昀椀c to the FPS sector and can be far more e昀昀ectively implemented This report highlights 昀椀ve critical objectives as part of a wider FPS strategy (see below). to strengthen UK-based FPS as a driver of jobs and prosperity: Big move #1: develop a long-term strategy for UK- • Support the conditions for growth based FPS to support growth (an “FPS strategy”). • Raise investment levels The strategy should outline the policy priorities that • Turn the UK into a digital-昀椀rst economy government, regulators and industry will focus on to support a competitive FPS industry to drive growth. • Anchor the UK as a leader in This would include how FPS can best support the sustainable 昀椀nance growth of potential areas of competitive advantage • Develop world-class promotion such as sustainable 昀椀nance, and emerging technologies and interconnectivity such as tokenisation. Clear timelines and routine Leeds Docks, Leeds reporting will be key. An FPS Partnership Council, with