2 weeks Ago By Pan Pylas, The Associated Press
LONDON (AP) — British Treasury chief Rachel Reeves said Thursday the government planned to merge dozens of pension funds with the aim of unlocking tens of billions of pounds for investment and boosting the U.K.'s subpar economic growth.
Read this article for free: Already have an account? To continue reading, please subscribe: * LONDON (AP) — British Treasury chief Rachel Reeves said Thursday the government planned to merge dozens of pension funds with the aim of unlocking tens of billions of pounds for investment and boosting the U.K.'s subpar economic growth.
Read unlimited articles for free today: Already have an account? LONDON (AP) — British Treasury chief Rachel Reeves said Thursday the government planned to merge dozens of pension funds with the aim of unlocking tens of billions of pounds for investment and boosting the U.K.’s subpar economic growth.
Reeves said in her speech to finance leaders in central London that the creation of so-called “megafunds” will represent the “biggest pension reform in decades.” In her first so-called Mansion House speech, an annual ritual for British chancellors of the exchequer, Reeves said the changes could help unlock 80 billion pounds ($100 billion) for investment. Pension funds invest in a variety of assets, such as shares, bonds, real estate and infrastructure, in an attempt to increase the retirement benefits for their members.
The proposed merger of 86 local authority pension funds in England and Wales has echoes in Australia and Canada, where pension funds are widely seen to have taken advantage of their bigger size to invest in assets and boost growth. By 2030, the new Local Government Pension Scheme in England and Wales is set to manage assets worth around 500 billion pounds by 2030. The Labour government will introduce the reforms through a bill in parliament next year.
Early indications suggest it has broad support across the political divide — the former Conservative government had indicated it would go this route, too — and within the pensions industry. “Larger pension schemes can help achieve better outcomes for savers through economies of scale, stronger governance, negotiating power and additional resources,” said Zoe Alexander, director of policy and advocacy at the Pensions and Lifetime Savings Association, an organization that seeks to bring the industry together and promote best practices. Business leaders cautiously welcomed the reform plan but said the government needs to work hard to win their support following Reeves’s tax-raising budget last month.
“With the budget piling additional costs on firms and squeezing their headroom to invest, the government needs to work hard to regain the confidence in the U.K. as a place businesses and communities can succeed,” said Confederation of British Industry chief economist Louise Hellem.
Winnipeg Jets Game Days On Winnipeg Jets game days, hockey writers Mike McIntyre and Ken Wiebe send news, notes and quotes from the morning skate, as well as injury updates and lineup decisions. Arrives a few hours prior to puck drop. “Pension schemes will want to operate within a U.
K. economy that is prospering,” she added. Since the global financial crisis in 2008-9, the British economy has underperformed relative to previous years.
The government’s main aim is to bolster growth. Figures Friday are predicted to show that the economy barely grew in the second quarter of the year. Advertisement Advertisement.
