How to Revive the ‘Stagnant’ Economy: Empowering Every Child with a £1,000 Investment Pot

Every child could receive a pot of £1,000 at birth to be invested in long-term growth strategies for the UK economy, according to proposals aimed at reviving the ‘stagnant’ economy.

This plan for a ‘New Generation Trust’ is part of a package of reforms that could potentially contribute £225 billion to the economy, as mentioned in a report by the City of London Corporation.

The idea brings back memories of the child trust fund scheme initiated by Gordon Brown twenty years ago but later discontinued by George Osborne.

The report suggests that these investments would be locked until adulthood, at which point they would be automatically transferred to an individual savings account (ISA) or a defined contribution (DC) pension.

By doing so, the government would provide a long-term source of capital for UK businesses and help foster an investment culture in the country.

The idea of a ‘New Generation Trust’ is raised as part of a package of reforms that could add £225bn to the economy, according to a report by the City of London Corporation

The report does not provide details on how this proposal would be funded.

It is one of several ideas aimed at boosting economic growth, including the establishment of a financial and professional services council co-chaired by the Chancellor, and the promotion of digitalization in businesses.

Chris Hayward, policy chairman at the corporation, stated that every aspect of the proposal is focused on driving growth and creating jobs, adding that a trust like this could be an investment in the nation’s future. The report is targeted at politicians preparing for the general election.

Hayward further stated, “Whoever is in power, we believe the common agenda item will be: once you have brought down inflation and interest rates, what do you do to drive economic growth? This country has been stagnant in terms of growth for many years.”