A Guide to Securonomics

Securonomics is a term that has recently been gaining attention in the media. But what exactly does it mean, and how will Labour’s new economic policy impact UK property investors?

What Is Securonomics?

Coined by Rachel Reeves, the incumbent Chancellor of the Exchequer, Securonomics at its core “focuses on the economic security of a nation.” It draws inspiration from the American concept of ‘Bidenomics,’ making it no coincidence that Reeves chose to launch her new economic concept in Washington DC in April 2023.

Reeves’ concept seeks to rectify the perceived shortcomings of the Conservative administration by providing a clearer approach to economic policy. According to Reeves, the Conservatives had been too laissez-faire, leading to underinvestment and a lack of economic security, especially in the wake of the pandemic. There is also a pervasive worry that the UK is not sufficiently autonomous, as evidenced by the impact of the Russian invasion of Ukraine on fuel supply chains. It is with these shortfalls in mind that Reeves decided that the UK needed a new approach to the economy entirely, hence the evolution of Securonomics.

Speaking at the launch of the concept in Washington, Reeves stated that Securonomics was all about…

“Prioritising economic strength and resilience in the face of our uncertain world. Addressing the challenges of the future, and finding the opportunities within them.  It also focuses on securing the finances of working people. Good jobs, decent pay, strong public services and an end to relentless increases in the cost of living”

Securonomics In Practice

In practice, Securonomics focuses on targeted investment strategies that benefit underserved communities and distribute prosperity more evenly. This commitment was evident in the Labour Party’s 2024 manifesto, and as the new government begins to implement its plans for the UK, we anticipate Securonomics will transcend being merely an economic concept and become the new cornerstone of the Labour Party’s financial policy.

A Focus On Local Decision Making

A significant aspect of this approach is local decision-making. The party’s manifesto emphasizes the need for a “smarter government that works in partnership with business, trade unions, local leaders, and devolved governments.” It argues that too many areas have been held back because decisions are often made in Westminster, rather than by local leaders who understand local ambitions and strengths. By empowering local authorities, mayors, and councils, decisions can be made that directly benefit local communities. After all, different communities across the UK have different needs and different pains that cannot be addressed adequately unless special attention is provided on a community level. 

A Boost To Investment

Greater investment is another cornerstone of Securonomics. To create a secure economy, substantial investment is required, involving both incentives and partnerships between the public and private sectors. The government aims to strategically invest in multiple ways, starting by identifying and forming international alliances and trade partnerships, with many in the Labour Party being particularly keen on re-joining the European Single Market. Additionally, they propose an £8 billion “national wealth fund” designed to co-invest public money alongside the private sector. Reeves stated that for every £1 of public money spent, Labour aims to secure £3 from the private sector to ensure the state gets “bang for your buck.” This is how Securonomics aims to bring security from investment.

Property Reform

More pertinent to existing or budding property investors is Labour’s plan to build 1.5 million new homes over their term, creating a “next generation of Labour new towns.” The Labour Party hope that the UK will see significant growth as a result of reforming the way we plan and bring forth new homes, with Reeves proclaiming that the slow planning system is “the single greatest obstacle to our economic success”. So, by stating her intention to tackle the severe undersupply of housing across the UK, Reeves is simultaneously proclaiming that she aims to boost the economy by reforming the bureaucracy of planning. 

Stable Economy, Stable Future

Stability is also a crucial element of Securonomics. The goal of the Labour Party is to avoid the kind of inflationary shocks seen in October 2022, when inflation rose to 11%, a 40-year high. The tail-end of the Conservative Party’s time in office seems to suggest that the economy has been stabilising anyway without the need for Securonomics, with mortgage rates gradually improving month-by-month and the Bank of England base rate anticipated to reduce by the end of 2024. This anticipated market stability will be beneficial for the vast majority of Brits: it ensures that the cost of living does not see unanticipated spikes, mortgage owners with variable rates can be comfortable that their rates will be predictable, and investors can feel confident in the market they are investing in.

How Will Securonomics Impact The Property Market?

Most important to Centrick Invest readers planning on investing in land and new homes is how the implementation of Securonomics will impact the property market. We anticipate the market will feel the positive impact of Securonomics in a number of ways:

1. Local planning, a key aspect of the strategy, means building the right properties in the right places, which will allow for the construction of properties that truly fulfill the needs of tenants across the UK and pays attention to what tenants want in specific towns and cities. This could mean the increase of permitted developments in areas with little space to build new constructions 
2. Should the government stick to its promise of bringing 1.5 million homes to the market, this will impact first time buyers as well as investors. The amends to planning and construction to expedite the building of new homes will create more ample opportunities for investors to invest and diversify their portfolio by purchasing units in new Labour towns 
3. Economic stability is a prerequisite for investment success. By improving Bank of England base rates and controlling inflation, investment properties and buy to let mortgages will remain affordable. It is this promise of economic stability and steady capital growth that has made the UK such a viable property investment prospect for so many years 
4. Securonomics aims to make energy cheaper through initiatives like GB Energy and more protectionist fuel supply chains. Lower energy bills will help tenants afford their rental accommodations, reducing the risk of being priced out and ensuring stable income for landlords

Stay In The Loop With Centrick Invest

In essence, Securonomics presents a comprehensive approach to economic security, combining local decision-making, greater investment, and stability to foster growth and prosperity. This promise of economic stability, improvements to planning reform and local investment strategies will be a fantastic asset to the UK property market.

As your local property experts, Centrick Invest are on-hand to keep you in the loop regarding any property news and insights on the government, economy and its impact on the property market near you. Have any specific questions? Fill out the form below to contact a member of our expert team – we’re on hand to help you navigate the property market no matter what your property goals may be.