Johnny Leavesley is a businessman and Chairman of the Midlands Industrial Council.

Whatever happens politically the state will soon be spending much more money. Labour has plans to nationalise industry, expand welfare and increase taxation in an attempt to create some sort of Utopian equality.

The Conservatives are seeking to reassure voters with increased expenditure on the NHS, education, grand infrastructure projects, and seemingly everything else.

Meanwhile, short-term prospects after Brexit are be likely disruptive to economic growth until new trade agreements are settled and then exploited.  However, to remain within the EU is to keep within a customs union the size of which is slowly contracting as a proportion of global GDP. It is a diminishing market.

There is a very big, structural problem, regardless of Brexit – our aging population. Every western economy which faces this issue partially solves it with the immigration of younger and preferably skilled workers, but post-Brexit it looks as if British governments will be less able to rely on this than they have in the past.

It is the productive workforce that pays for everyone else’s public services, health, and welfare. This is ‘the dependency ratio’, and is only sustainable with long-term economic prosperity.

In our largely services-based economy, as healthcare improves and working practices adapt, it is possible for people to have longer working lives before retirement, but there will always be limited opportunities for 65-year-old labourers. Robotics may help to fill labour shortages, but there will be a generational time lag before technologies are adopted.

The simple fact is that an ageing population will need increasing pension payments, but a worsening dependency ratio will lead to a smaller pool of productive (and increasingly resentful) workers to pay for it all. When you have an expanding population and economic growth this is just about affordable. Post-Brexit, it might not be.

A sovereign wealth fund is the answer. This is a state-owned entity which invests globally to compound its size and generate income that can be used for the benefit of its citizens. Established by Royal Charter, and properly protected from politicians wanting to raid it for pet projects, it would be able to supplement pension costs and, if its mandate allows, invest in domestic, income-generating infrastructure.

Countries that have them tend to fund them from budget surpluses, asset sales, and revenue from exporting natural resources. Those sources are not available to us. Even after a decade of austerity we still have too much debt to be able to balance the books year on year. It would therefore be easy to conclude that it is not affordable.

However, with bonds yields historically as low as they are, the Bank of England could issue a sizeable amount of long-term 30-year gilts – currently the coupon is at 1.75 per cent – and invest the tens of billions raised in emerging markets where returns of up to five per cent are very possible.

Emerging markets generally have the characteristic of expanding populations with skilled, youthful workforces aspiring to western-style consumerism. The effect is that the pensions for our retirees would be generated from profits created by younger workforces elsewhere. This may seem like a giant, government-backed hedge fund – and in some respects it is – but with the essential difference that it would never go bankrupt. In the unlikely event that it could not pay the coupon on those gilts, the Old Lady of Threadneedle Street could ultimately generate sufficient money at the click of a suitably-authorised mouse.

All this extra debt to establish the fund may seem counter-intuitive to the prudent and financially literate. It is true that there is a tipping point at which the costs of servicing and repaying debt diminishes economic growth. When that is in prospect government budgets must be reduced – what politicians call ‘austerity’. The bond markets are very sensitive to this and price in tolerance levels accordingly.

But government debt spent on current expenditure is viewed less positively than money raised for investment. When politicians talk of ‘spending to invest’, bond markets tend to be sceptical. Social spending on welfare and health do not produce financial returns, regardless of their other merits. A sovereign wealth fund, however, is regarded by markets as an actual investment. The value of the assets held, the income generated, and a government guarantee all change market perceptions positively.

If such a fund is not created there will inevitably be, at some point, unpleasant and politically difficult choices to be made. Either expenditure that is currently prioritised will have to be substantially and permanently reduced, or pensioners will have to accept lower incomes. To solve this dilemma a sovereign wealth fund is not just a post-Brexit opportunity, but an economic necessity.