Tony Blair – the ultimate wealth management mascot?

The British prime minister's legacy might be brought into question by some sections of society, but the wealth management sector would give him a universal thumbs up when he leaves.

As Tony Blair announces his departure date today there will be much talk about his political and economic legacy. Debate will revolve around Iraq, the economy and public services under his rule.

But there will be one area he will almost certainly get the universal thumbs up on: creating a flourish environment in the UK for the rich and as such the wealth management sector.

As the Sunday Times Rich List said last month: “The past decade of Labour government under Tony Blair has proven a golden age for the rich, rarely seen in modern British history”.

That publication –the most prominent barometer of the rich in the UK– said that since Mr Blair came to power ten years ago, the wealth of Britain’s richest 1,000 has grown by 263 per cent to a staggering £261 billion.

There is no other country in Europe that has witnessed such strong growth – with only the US, and possibly China and India claiming matching growth rates in other parts of the world.

The wealth management sector has flourished equally during this period, with a growth rate possibly even exceeding that of the richest 1,000 in the UK, say analysts.

If you asked the wealth sector ten years ago what they would have felt about a Labour government coming to power, few would have expressed much enthusiasm.

Indeed, many would have been downright sceptical, given the party’s left-leaning legacy.

And few – even in the dreams – would have thought the sector would be flourishing as much today as it is.

Of course, much of this has been due to forces outside of the control of the Blair government – globalisation the most obvious. But his government’s policies have more than just underpinned the wealth sector.

"Mr Blair’s economic policies effectively instigated the largest boom in UK personal wealth since the industrial revolution," said Sebastian Dovey, managing partner of the financial consultancy Scorpio Partnership and one of the most seasoned observers of the UK wealth sector.

The cornerstone of this was the resident, non-domicile tax perk for the very rich, which has meant that London has become the biggest global centre for the burgeoning class of footloose billionaires and multi-millionaires.

This trend is portrayed well in a recent Citigroup/Knight Frank report on the global property market and the very wealthy.

Mr Blair is almost certain to be succeeded by Gordon Brown, who can in some ways take even more credit for the boom in the wealth sector as the Chancellor of the Exchequer during the last 10 years.

But there are signs that there is a growing debate among Labour members of parliament about the legitimacy of tax breaks for very rich foreigners, particularly as the gap between very wealthy and the less fortune members of society grows wider.

And some wealth managers are likely to be wondering if the new prime minister might start to apply the brakes to the perks the very wealthy have enjoyed during the last 10 years. Higher income taxes have also been mooted.

Equally, though, wealth managers might be looking back in ten years time at an even more rich-based economy than when Mr Blair left office, particularly if successive governments allow the forces of globalisation to flourish.