Commenting on the Pensions Investment Review: Call for Evidence, Mark Jaffray, Head of DC Consulting, says: "We support the government focus on how more DC pensions investment can be deployed in the UK. Increased investment in UK opportunities through listed or illiquid investments could potentially deliver improved returns and outcomes for DC members. However, UK pension schemes have an obligation to seek the best investment outcomes for their members for the risk they take. Allocating more investments to UK opportunities, e.g. companies and infrastructure, can only be justified if the investment case is strong enough compared to investing elsewhere.”
Commenting on the Pensions Investment Review: Call for Evidence, Robert McInroy, Head of LGPS Client Consulting, says: “We fully support the government’s ambitions for the UK economy and the recognition that increased investment can catalyse growth. As long-term investors, the LGPS can make appropriate investments to support the UK economy, building on what it has achieved already. However, this must be done without losing sight of the core purpose of the LGPS of paying members’ benefits when they fall due.
“To this end, investments in the UK should be driven primarily by the quality and suitability of the available investment opportunities. We trust the Government will consider how it can make available such opportunities and increase the attractiveness as investments for LGPS funds. As part of this process, the best outcome will be achieved with the Government and LGPS community working together to identify solutions and future evolution of the scheme.”
Rob Yuille, Head of Long-Term Savings Policy, Association of British Insurers, said: “We want to see successful, enduring pensions policies that secure the best outcomes for savers. We fully support ambitions to attract more investment in the UK economy, including the government’s appetite to increase investment opportunities for pension schemes. However, pensions are for the long-term - so any changes must be part of a long-term strategy that is joined up across government and regulators, and that can command cross-party support.
“There’s already lots of consolidation in the DC market, and the new Value for Money Framework supports this agenda as well as shifting the focus from cost to value. Similarly, new innovative co-investment schemes, such as LIFTS, and blended finance models have the potential to shift the dial and encourage greater investment in illiquid assets. Our industry will continue to work closely with the Government during the course of this review.”
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