Only 10% of the public say that supporting UK national security would make them more likely to invest in a defence bond.
Financial incentives matter more: 31% cite tax-free interest and 29% cite a competitive rate.
43% say they would want to learn more before deciding whether to invest.
Trust is a major barrier: 30% say they would not trust the Government to spend the money effectively.
Retail investors show stronger interest but also higher expectations than non-investors: 56% cite tax-free interest and 53% a competitive rate as the primary draw.
The overwhelming majority of investors who might buy a bond said that they would fund it from cash rather than existing investments
New polling from Hargreaves Lansdown, the UK’s largest investment and savings platform, suggests that Britons are open to the idea of National Security Bonds to help fund rising defence costs, but patriotic appeal alone is not enough to persuade most people to invest.
The polling follows renewed political interest in using government-backed bonds to raise money earmarked for defence, echoing the idea of the “War Bonds” sold during the First and Second World Wars.
The survey found that only 10% of the public said they would be more likely to invest because they wanted to support UK national security. Among active retail investors, the figure was slightly higher, at 15%.
By contrast, financial incentives were much stronger motivators. Among the general public, 31% said tax-free interest would make them more likely to invest, while 29% cited a competitive rate. Among those who already invest, those figures rose to 56% and 53% respectively. Inheritance tax treatment could also be a meaningful lever, with 25% of retail investors saying they would be more likely to invest if the bonds fell outside their estate for inheritance tax purposes.
The polling also suggests the main barrier is not opposition to defence spending itself. Only 12% of the public said they would not invest because they did not want their money linked to defence or military spending. The bigger concern is trust: 30% said they would not trust the Government to spend the money effectively, while 23% said there was not enough information about how the money would be used.
Despite this, the data shows a significant group remains open to persuasion. 43% of the public and 49% of retail investors said they would want to learn more before deciding whether to invest, suggesting any future bond would need clear terms, a competitive return and strong commitments on how the money would be used.
The polling also suggests that National Security Bonds could attract new money to investing from cash savings, rather than simply be a reallocation from existing investment portfolios. The overwhelming majority of investors who might buy a bond said they would fund it from cash rather than existing investments. 65% of respondents said they would take the money from cash savings or income, compared to just 12% who would fund a bond purchase from other investments. The result suggests that national security bonds could support long-term efforts to encourage the British public to invest more and hold less in cash. To be successful, it would need to be positioned carefully alongside existing savings and investment options.
Anna Macdonald, investment strategy director, Hargreaves Lansdown:
“Brits are open to buying a bond to fund our national defence, but patriotic rhetoric alone won’t be enough to persuade them to invest. Any government that’s interested in this policy should consider incentives including more favourable tax treatment to encourage investors to commit their money. Inheritance tax could be a powerful lever to pull here.
Our polling shows that the public have little trust in governments to use the money they raise effectively, so any so-called “war bond” would have to come with very clear and strong commitments to make sure the cash they raise was being put to good use.
Of those that would consider investing, a sizeable portion said they would use cash savings to fund a purchase, instead of switching from an existing investment. With the government’s ambition to get more Britains investing, a National Security Bond offering the right incentives could also encourage people to money out of their cash pot.”
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