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Landslide win for Labour: impact on financial advice sector

ended 05. July 2024

Following this morning's landslide election win for the Labour Party, Newspage asked financial advisers how this could impact  investors and people putting money into their pension pots. Their views are below.

4 responses from the Newspage community

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Daniel Wiltshire
Actuary & IFA at Wiltshire Wealth
The markets have been pricing in a Labour landslide for months and have barely moved this morning. It will be interesting to see what happens once we start to get more policy detail, something that was sorely lacking during the campaign. The new government will be acutely aware that unfunded spending plans could potentially trigger a Truss-style spike in interest rates. They'll want to keep the bond markets on-side. With taxes and public spending at historic highs, there is very little room for manoeuvre. That said, it's worth remembering that the UK accounts for around 4% of global market capitalisation, so for investors with well diversified portfolios there's no need to panic.
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Joshua Gerstler
Chartered Financial Planner at The Orchard Practice
In the short term, there will be movement and policy changes that impact everyone one way or another. For long-term investors, which most of us are, a well diversified equity portfolio will continue to grow, regardless of who is in power. Businesses will continue to find ways to innovate and grow and will always be looking to generate profits.
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Dariusz Karpowicz
Director at Albion Financial Advice
The landslide win for Labour doesn't necessarily bode well for the financial advice sector. Their ideas aren't exactly pro-housing market or business-friendly. However, let's wait and see—they might just prove us wrong. For investors and those putting money into their pension pots, the outcome is uncertain. Labour's promises of regulation and market intervention could create challenges. While they aim to address the housing crisis and support first-time buyers, the broader impact on the financial markets remains to be seen. It’s a time for cautious optimism and careful planning as we navigate these new political waters.
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Samuel Mather-Holgate
Independent Financial Adviser at Mather and Murray Financial
This is a momentous moment for Britain, homeowners, those saving for retirement and anyone else who wants a secure future. Finally we will have a government focused on stimulating a stagnant economy. Expect to see incentives in the home building sector, for buyers, builders and even sellers. This is the most important way of getting the economy moving that will allow Starmer to push an agenda for change so many people voted for. Not much will change in terms of policy, as Reeves will seek to be judged on her mantra of stability. However, stability is new and a breath of fresh air for markets. A budget in the first 100 days is unlikely, but would be welcomed if Starmer really wants to push for growth.