Interactive Investor abandons retail campaign in fresh blow to Rachel Reeves
Chancellor Rachel Reeves’ plans to increase investment in the UK stock market has been hit with a fresh blow, as Britain’s second largest retail investment platform pulls out of the government backed marketing campaign.
Interactive Investor, which is owned by London listed investment manager Aberdeen, has become the latest well known name to abandon the initiative, according to Sky News.
The industry-led campaign, which is being coordinated by the Investment Association, is aiming to explain the benefits of investing in a bid to stop people from hoarding cash.
The Chancellor hailed the campaign as a key part of her ambition to “rewire the financial system” upon its announcement in July.
Funding the campaign
Companies who agreed to help fund the marketing push included Barclays, Natwest, Hargreaves Lansdown, London Stock Exchange Group and asset manager Schroders.
However, since July, backers with a significant presence in the UK retail investment space have reportedly withdrawn from the plans, such as AJ Bell, Freedtrade and Trading212.
The withdrawal of Interactive Investor is said to have been driven by the cost implications of participating.
The campaign, which will be overseen by advertising agency M&C Saatachi, will go live next year.
Cash ISA reforms
The campaign will follow likely changes to the ISA regime in the upcoming Autumn Budget, as part of the Treasury’s efforts to stop an over reliance on cash.
Reeves is rumoured to be slashing the cash ISA ceiling from £20,000 to £10,000 in this month’s Budget, after initial plans to do so during the summer were scrapped after fierce backlash from building societies.
The providers argued that they used cash ISAs to fund mortgages and reducing these inflows would potentially make home loans more expensive.
Other reforms include a potential hike to dividend tax, which could see investors move their investments into tax efficient wrappers, such as stocks and shares ISAs, to avoid paying more.