Premier Miton Investors calls on the Government to direct more of the UK’s savings into UK companies

March 19, 2025

Two immediate actions will help to deliver a significant boost to economic growth, to employment and the tax revenues to be invested into UK services.

Premier Miton Investors, the £11 billion AUM investment management firm, which invests in some 418 UK listed companies, is calling on Government, via a letter to the Chancellor Rachel Reeves and City Minister Emma Reynolds, to enact two immediate and joined actions which would deliver substantial, rapid and beneficial changes for the UK economy.

Limit Cash ISAs. Premier Miton first called for ISA reform in 2023, specifically championing the GB ISA. Limiting the future tax benefit to £5,000 will significantly reduce the almost £300bn^[2] allocation to cash within ISAs and immediately increase future investment savings into equities. Premier Miton share the view expressed by Emma Reynolds that by holding onto cash savings, consumers are missing out on substantial potential investment returns. There is a significant benefit for both investors and the UK economy from this cash being invested in more productive assets. To avoid the risk that a large proportion of switched savings would be invested into overseas equities, Premier Miton propose an incentive to invest savings to benefit UK businesses and the UK economy.

Focus ISA Equity allocation to the UK. Limiting all future equity ISA contributions to UK listed equities, UK domiciled funds that invest at least 80% in UK equities, UK listed funds and UK Government gilts, would provide a significant increase in the proportion of savings invested at home. This does not prevent individuals investing in foreign companies, but it improves the allocation to domestic investment, supports a flourishing UK equity market and a growth agenda, and is far better for the economy as a whole and the country in the long term.

The tax cost of making these changes is nil. The administration changes involved are minimal and the benefits are potentially significant.

London AIM market listed Premier Miton, which invests £4.5bn in the capital of companies of all sizes, including many small and mid-size businesses across the UK, originally called for the GB ISA in 2023, and has long been a supporter of ISA reform. It also strongly believes in the principle that when the UK’s tax system provides benefits to encourage and support long term savings, that UK businesses get value for and a fair share of this investment so that our domestic economy and society benefits. In the UK, taxpayers effectively pay c. £6.7bn to subsidise investing UK savers’ capital overseas.

Mike O’Shea, Chief Executive Officer, Premier Miton Investors:

“Premier Miton has been calling for ISA reform for some time to ensure that tax breaks for British savers are used to support British businesses. This will help ensure that companies have access to the capital they need to scale up and list here in the UK.

“We know the current Government is keenly aware of the challenges facing the UK’s domestic savings and investment sectors and their critical role in creating the economic growth that is essential for our national prosperity, security and resilience.”

Robert Colthorpe, Chairman, Premier Miton Investors:

“Increasing investment flow into listed UK companies would lift valuations, making it more attractive and easier to raise capital for both organic growth and growth via acquisitions. These actions would also help to create more jobs across a range of industries as well as in the associated professional services sectors, an area of strategic focus for the UK.

“We think it would boost the number and the size of IPOs in the UK, breathing new life into our capital markets, further adding to GDP growth. Finally, it would send a fantastically strong signal to international capital markets and UK businesses of the Government’s intent and commitment to creating a vibrant and resilient domestic investment market.”