-
In March 2024, the FCA concluded a thematic review (TR24/1) into retirement income advice. Interestingly, within this review, they found that...
-
In July, we learned that consumer prices in the UK rose by 2.0% in the 12 months to June –...
-
You will have likely woken up to the news that global stock markets have fallen sharply. This appears to be because...
-
You will have seen that the Bank of England (BoE) cut interest rates by 0.25% today, the first cut since...
-
The world of politics took a surprising turn over the weekend, as we learnt that US President Joe Biden has...
-
It is conventional wisdom that investment decisions are usually informed by an assessment of the investor’s willingness to take risk...
-
In June, we learned that consumer prices in the UK rose by 2.0% in the 12 months to May 2024,...
-
As one may suspect, we are often among the first companies called by an investment business when a fund manager...
-
In May, we learned that consumer prices in the UK rose by 2.3% in the 12 months to April 2024,...
-
Yesterday, it was announced that the UK will hold a general election on July 4th 2024. We can understand how...
-
The conscious decision to invest in one asset class over another is probably the most important investment decision we will...
-
In April, we learned that consumer prices in the UK rose by 3.2% in the 12 months to March 2024,...
-
You will have likely seen the news on Saturday. On the back of these developments, we noted that equities in...
-
In March, we learned that consumer prices in the UK had risen by 3.4% in the 12 months to February...
-
February saw diverging fortunes in markets, with stocks performing well while fixed income markets were largely down. Within fixed income, it...
-
Chancellor Hunt unveiled this year’s Budget on Wednesday in the House of Commons. Background Since the next UK general election is likely...
-
One of the most common questions we receive from our clients revolves is whether to remain in cash or transition...
-
The “Magnificent Seven” Stocks - Our View and Portfolio Exposure – Fundhouse Adviser Insights6th March 2024The concentration in the S&P 500 of just seven names – Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla is...
-
In December, the annual level of UK Consumer Price Inflation rose to 4%, up from 3.9% in November (with a...
-
In November, the annual level of UK Consumer Price Inflation fell to 3.9%, down from 4.6% in October. It is...
-
November saw positive news on inflation – UK CPI data for October fell to 4.6%, a notable drop from 6.7%...
-
On Tuesday, the FCA released a 212-page Policy Statement on Sustainability Disclosure Requirements (SDR) & Investment Labels. These new rules will...
-
On Wednesday, Chancellor Hunt delivered an ‘Autumn Statement’ to give Parliament an economic update and announce new policies – “110...
-
Having seen painful double-digit inflation in late 2022, it was something of a relief in October to see UK inflation...
-
At Fundhouse (UK), we help our clients avoid pitfalls when choosing funds. Fundhouse CIO Joe Wiggins investigates why following the...
-
At Fundhouse, we dig deeper into the data to make better investment decisions for our clients. Have UK equity fund managers...
-
2022 has been an incredibly difficult year for investors. Not only have we seen steep declines in equity markets, but...
-
As a UK citizen, it is certainly worrying that we have our fourth Chancellor and (soon to be) third prime...
-
The UK commercial property market is facing a torrid environment. Not only is the economic outlook bleak; but rising interest...
-
Over the years at Fundhouse (UK), we’ve spoken to dozens of #assetmanagement firms undergoing corporate change. Today, we share insights on...
-
Based on years of observation and bitter, painful experience; here are my thoughts on the ten most significant mistakes made...
-
At Fundhouse (UK), we use our own algorithms to analyse trading patterns, giving our clients greater #investmentclarity about the funds...
-
At Fundhouse (UK), we monitor the fund universe for signs of #liquidity issues, to give our clients better #InvestmentClarity. Today, we...
-
At Fundhouse (UK) we’ve been building a #greenwashing detector to give our clients greater #investmentclarity. We’ve uncovered a number of insights...
-
In today’s blog, we look back at the many meetings that we have had with fund groups discussing ESG. Although...
-
The market has become counterintuitive: in a strongly rising market across almost all asset classes, we find expensive has beaten...
-
As part of our manager research process for a given fund, we will evaluate the corporate entity employing the investment...
-
In this article, we explore whether there is persistency in tactical asset allocation skill, by evaluating the evidence we have...
-
In this article, we discuss how the historic low yields we are seeing in credit markets today does not seem...
![](https://www.fundhouse.co.uk/wp-content/uploads/2024/07/kier-starmer.jpg)
UK General Election Results
![]() |
Home » Published: 5th July 2024 This Article was Written by: Chris Proudfoot - Fundhouse |
Following the overnight news that Keir Starmer and the Labour Party won a large majority in the UK General Election, we have written the following note outlining the potential implications for personal finance and investment markets.
Taxation
Labour has typically been associated with wealth redistribution, higher taxation, and increased spending. However, in this election, both Labour and the Conservatives committed to tighter spending plans. The two parties were perhaps much more closely aligned in this regard than in years gone by. This is in the wake of the shambolic mini-budget of 2022, where Conservatives Liz Truss and Kwasi Kwarteng announced several unfunded tax cuts, which knocked investor confidence in the UK and has left scars on the gilts market – but Labour’s more cautious approach to finances should foster stability and confidence there.
Less ambitious spending plans has meant that Labour has been able to commit to not raising income taxes, which has gone down well with many voters. But we know that the tax burden will certainly increase for some families, with plans to add VAT to private school fees and a promise to reform the ‘non-dom’ rules.
It is also telling to look at the areas where Labour has not explicitly ruled out tax increases, as these may be fair game in the near future: in capital gains tax (CGT), dividend tax, and tax relief on pensions. Neither has Labour addressed the issue of frozen income tax thresholds. Although this is not an explicit way of increasing tax revenues, it is often referred to as a ‘stealth tax’ – wages and other income usually rise with inflation, so by simply freezing the threshold at which one starts to pay tax (or higher rates of tax), more people are destined to be dragged into higher tax bands every year.
Markets
One area of high importance to Labour is in housing, with a pledge to ‘get Britain building again’. It is expected that Labour will aim to change the planning system and focus on affordable housing, utilising the ‘grey belt’ – under-utilised land already in urban areas, such as poor-quality wastelands and disused car parks.
While Labour governments are typically seen as favouring more intervention and regulation across industries, we are reminded that the Conservative government of the last 14 years hasn’t exactly been hands-off itself. We’ve seen such policies as sugar taxes, energy price caps, and windfall taxes on oil producers. This is on top of the increased influence of regulatory bodies such as the FCA and Ofcom. While we don’t expect intervention to lessen under Labour, we note a ‘friendlier’ approach to the financial services sector than may have been expected under previous Labour leadership, with the party ruling out a banking windfall tax or a bonus cap while vowing to cut down regulatory red tape.
The Labour Party have pledged to create Great British Energy: a new, publicly owned clean-energy company, harnessing Britain’s sun, wind, and wave energy potential. Clearly, they are turning their back on the oil and gas industry somewhat, which will likely affect the UK stock market, given the concentration of oil and gas majors in the FTSE.
Finally, regarding currency, it is possible that sterling will experience short-term depreciation due to the initial uncertainty of a new, but long-term effects will depend on Britain’s economic performance under Labour policies.
Conclusion
The last few years have often seen wide discrepancies between the UK’s main parties, particularly under the leadership of Jeremy Corbyn and Boris Johnson – attitudes to Brexit and handling of the Covid pandemic come to mind, amongst countless others. Arguably, the parties are more closely aligned today, which has meant less uncertainty regarding policy and market volatility going into this election. They will likely be more fiscally reserved regarding spending than previous Labour governments, but as noted earlier, they’ve left open the potential for a number of tax increases (excluding income). They will be more open for business than the manifestos of previous Labour leaderships had been and are likely to have a ‘greener’ focus than the outgoing Conservative government.
Clients familiar with our investment philosophy will know that we do not incorporate forecasting of geopolitical events, such as elections, into our portfolio decision-making. While elections often cause short-term volatility in financial markets, they rarely have a predictable longer-term impact.
Speak to the team: mps@fundhouse.co.uk.
Fundhouse is the trading name of Fundhouse Bespoke Limited. Fundhouse provides investment management services to professional clients and does not provide financial advice. Importantly, this note does not represent investment advice and any reader should always speak to their financial adviser before making any investment decisions. Please note that the value of any investment may go down as well as up and you may lose capital when investing and the value of your investments may not always increase. Please ensure that you are comfortable bearing financial losses and that you are comfortable taking a long-term investment view of five years or more.
![](https://www.fundhouse.co.uk/wp-content/uploads/2024/07/kier-starmer.jpg)