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External publication

Beyond boosterism

The UK is a low investment nation. Low business investment is a big driver of this. Low investment is one reason behind the UK's weak productivity growth, which in turn is the main reason behind the stagnation in UK living standards. Policy makers understand this and have made attempts to fix it. This paper, part of the Economy 2030 Inquiry, explains why this matters, why recent attempted fixes won't cut it, and what to do about it, as part of a broader economic strategy for the UK.

This report finds that corporation tax cuts and a return to policy stability, while important, will not be sufficient to bring about the new investment ecosystem that the UK badly needs. Instead, wide-ranging reforms to the pension system and corporate governance are needed to focus firms' managers on long-term value, boosting their willingness to invest. Fundamental changes to the UK's restrictive planning regime are needed to improve firms' ability to execute these new investment plans. Meanwhile, unlisted high-growth businesses should get more backing from the newly restructured pensions industry, a powered-up British Business Bank, and evidence-based business support policies.

Paul Brandily, Mimosa Distefano, Krishan Shah, Gregory Thwaites and Anna Valero

22 June 2023

The Economy 2030 Inquiry

Beyond boosterism

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This External publication is part of the centre's Growth programme.

This publication comes under the following theme: UK productivity and policy