Press Release 37 – UK Investments, UK Returns, UK Growth
There has been considerable focus recently on how pension funds should invest more in the UK for “Levelling Up”, for UK growth and for the future. This is a major part of the LGPS funds consultation published recently by the DLUHC.
In their annual reports, the 86 LGPS funds publish figures showing the balance of their UK and Global investment assets, AND the income or returns from these investments.
Information from Annual Reports for five years shows that CPF invests only about 20% of CPF assets in the UK, but these return about 80% of investment income.
Press Release 37 – UK Investments, UK Returns, UK Growth
BBC – The future of the economy and prosperity depends on investment spending.
In Chapter 5 – Investing in Britain’s future, this report looks at the roles of pension funds and how they invest.
“ The common objective would be to produce a system that directly holds more UK equities (listed and unlisted) via a smaller number of far larger pension funds, which have the incentive and means to take an active interest in their holdings. This will also give them the scale to invest in unlisted high growth firms and infrastructure projects in the UK. Specifically, we propose
- legislating to facilitate the entry of DB schemes into ‘superfunds’ and extend the remit of the Pension Protection Fund (which absorbs DB funds when an employer becomes insolvent) to provide a state-backed consolidation option for solvent pension schemes – something the PPF itself has expressed interest in;
- accelerating the consolidation of DC schemes, requiring funds to carry out stringent value-for-money tests and mandating funds that fail them to close, with a target of there being fewer than 250 DC funds by the end of the decade,
just over 10 per cent of the number of schemes that exist today; and,- pooling the £300bn of LGPS assets, currently split between 86 local pension funds in England alone, into one consolidated fund, which would have similar in-house scale and expertise as the large Canadian and Dutch pension
funds. ”
