Britain has built a savings culture that rewards standing still and quietly penalises taking a chance. We give a tax advantage to money left sitting in a cash account, and we make it harder, and more complicated, to back a growing British company with the same savings. Then we act surprised that our productivity is flat and our best firms raise their later money abroad. This is not bad luck. It is what the incentives were built to produce.
Contrast that with the United States. Through their workplace pension plans, Americans have poured capital into equities and into their own companies for decades. They had this argument twenty years ago and settled it. The pay-off is a technology sector that leads the world. Plenty of those bets failed, but the failures paid for the winners, because a culture that learns from failure keeps taking the risks that create the giants.
The cash trap
Start with the obvious fix. It makes little sense to hand a tax break to money that merely sits in cash while asking productive investment to work harder for a weaker incentive. There is a live debate about trimming the cash side of the tax-free allowance and steering the benefit toward stocks and shares. I would support the principle: reward should follow productive investment in Britain, not idle balances. Cash has its place for security, but the tax system should not pay people to keep the country's savings dormant.
None of this means lecturing savers into risk they do not understand. It means fixing defaults and incentives so the easy, sensible option is also the productive one. Most people are not frightened of investing. They simply do not know how, and the system does little to help them. That is a financial-literacy problem and a design problem, not a character flaw in the British saver.
Back British companies on purpose
We already have tools that channel money into UK firms. The Enterprise Investment Scheme, the Seed Enterprise Investment Scheme and Venture Capital Trusts all give tax relief for backing British businesses, and the relief is tied to investing in the UK. The lesson is that a well-designed incentive can direct capital where the country needs it. The task now is to extend that logic, sensibly and at scale, into pensions and into later-stage growth funding, so a British company can raise its Series A, B and C rounds at home rather than being forced across the Atlantic.
The prize is keeping the upside here. When we build a company, list it, and then watch it sold on so that the gains flow overseas, we are doing the hard part and handing away the reward. I would far rather the wealth created by clever British companies accrued to British pensioners and savers than to overseas equity and hedge funds. That is not protectionism. It is refusing to give away what we have earned.
Celebrate the failures that lead somewhere
The hardest cultural change is the one around failure. We treat any failed public investment as a scandal, which teaches every official to avoid risk entirely. But you cannot pick only winners. If we want the successes, we have to accept that some sensible, informed bets will not come off, and treat that as the cost of progress rather than as a crime. Reward the risk, learn from the misses, and stop punishing the very behaviour that growth depends on.
Britain does not lack talent, savings or ideas. It lacks a system that rewards putting them to work at home. Fixing that is not about spending more. It is about pointing the incentives we already have at the country we actually want.