Helping Members run their schemes, May 2023 update

Of course, there is nothing new about politicians vowing to ‘unlock’ pension funds for more investment in UK enterprise / infrastructure / venture capital etc; my Policy colleagues have been attending Whitehall roundtables on these issues since at least the ‘patient capital’ review of 2016.

What is different now is that both the Government and the Opposition are singing a similar tune, and the volume is getting louder.

In the March Budget, the Government announced that this year’s Autumn Statement would include proposals to ‘unlock DC pension capital’ to support ‘UK growth’. The Budget also announced plans to further accelerate the consolidation of Local Government Pension Scheme funds, which are already largely managed in eight ‘pools’. The Labour Party have also made it clear this area would be a priority for them in office.

Clearly, there is going to be action on this front. If we do not influence and inform it – including making positive proposals on how the UK regime and UK assets could be made more appealing to pension funds, then there is a risk we will end up with policies that are – to use some political language – ‘unhelpful’.

This is where my Policy colleagues really earn their corn, representing you to HM Treasury and other Departments and Regulators. Part of this is simply briefing officials and Ministers on how pension funds invest, including the different approaches taken by DC, DB (open or closed) and LGPS schemes. The team has highlighted the extensive scope for more investment in illiquids by each type of fund, but also identified the barriers. We’ve also responded to the recent consultation on Long-term Investment in Science and Technology (‘LIFTS’). Busy times!

These issues are sure to feature at our Investment Conference in Edinburgh (6-8 June) – a great opportunity for us to hear your personal perspective on these issues. I hope to see you there.

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