2020 is going to be a pretty rough year for all of us. Our front line NHS staff will have a particularly torrid time. Many of the financial losses incurred by individuals will not be covered and unemployment will become, sadly, quite common. So, is there anything extra we as individuals can do to improve the situation? How can we invest in our economy?
I am suggesting a form of Citizens Wealth Fund independent of national government and have laid out a possible format in this document.
Essentially any UK citizen or those with a right to live here could apply for an account that would hold their free share in the fund. You are only allowed one share, it cannot be sold or passed on and its life will end with yours. The free share would pay out an annual bonus which would be a portion of the previous year’s profits.
They could also invest in trade-able bonds which would pay a set interest rate plus a bonus. The bonus is also a share of the annual profits.
The general aims of the fund could take into account the following:
- The environment should be a prime motive in all investments.
- Have social benefits.
- Invest heavily in affordable housing.
- Economic regeneration in conjunction with local stake holders.
- A holder of national assets like farmland and buildings.
- An investor in business as a partial or total shareholder with profit shared with employees.
- Work with local and national government, charities and educational establishments to help with funding.
- Operate a national carbon offset scheme.
- Be a long term investor and savings vehicle.
- Invest in future technologies, manufacturing and agriculture.
- Make a profit for citizens.
Please let me know your thoughts, ideas and criticisms.
* Ian Hamilton is a Lib Dem member in Horley
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6 Comments
Is it going to be compulsory ?
You could always join the Ecology Building Society…. an ethical mutual with all the benefits you say that you want without any of the drawbacks, and it’s not cancelled or confiscated on death..
Hi David,
You would only lose the single share which has no value. Any money/bonds in the account would be part of your estate. It’s not just about the environment but about investment in the UK economy like affordable housing and investment in areas that have been “left behind”.
Nothing about this proposal would attract me to invest in the fund.
The description leads me to believe that the investment returns would be far worse than I can achieve with my present investment strategy, which just involved buying listed equities.
Even if one claims no personal investing ability, given a choice between investing in this fund and simply buying a low-cost global index tracker, why would anyone want to invest in this fund?
Ian.
I can see you have put some initial thought into your proposal document. Social or ESG investing is a growing, if still niche area. This site is an example https://emea.invesco.com/uk/en/esg-etfs/?gclid=EAIaIQobChMIm7HAks6s6AIVBLDtCh0x6A9ZEAAYASAAEgJibfD_BwE
My first thought is your fund objectives are quite broad. You could try floating the idea on an equity crowd funding platform like https://www.crowdcube.com/ to guage interest, but you will need regulatory approval from the Financial Services Authority to market an investment fund to the public. Approval can take up to six months. Part of the approval process requires the investment manager to demonstrate adequate financial resources and appropriate staff, systems, and controls to manage the fund.
Hi Mohammed,
I agree. I invest in a broad range of funds including some peer to peer. However this fund would return more than the guaranteed 1% with the addition of the annual bonus, which in time, would grow. This is essentially a decent paying bond fund that also offers social benefits. So although a young investor my only contribute a very small proportion of their savings, as you age you would gradually switch more into incomes producing assets like this.
Regards Ian
Hi Joe,
I realise this would be a major undertaking. Perhaps starting with affordable rental developments and then gradually forming management teams to cover other areas. The Big Issue have an investment unit called Big Issue Invest and there is the Resonance Fund based in Bristol which has a number of funds. So there is a market for this kind of investing.
Regards
Ian