Chancellor of the Exchequer Rachel Reeves has called on British pension funds to adopt strategies from their Canadian counterparts to invigorate the UK economy. On August 7, Reeves will host a roundtable with the ‘Maple 8,’ a group of prominent Canadian retirement funds known for their substantial investments in the UK over recent years.
During the meeting in Toronto, Reeves will encourage these funds to continue their support for the UK and to share insights on how consolidating pension schemes into larger funds can enhance investment in critical infrastructure and high-growth sectors.
This roundtable is part of a broader effort related to the landmark review of pension fund investment, announced last month. The review aims to stimulate investment in the UK and improve returns for pension savers.
In addition to her focus on pension funds, Reeves will address the financial services sector in her upcoming Mansion House speech. She will outline her plans to collaborate with industry leaders and regulators to foster growth within the sector. Her agenda includes ensuring the sector’s stability, supporting investment across the UK, and implementing reforms to keep the sector at the forefront of innovation and technology.
Reeves commented:
“The size of Canadian pension schemes enables them to invest significantly more in productive assets like essential infrastructure than our funds currently do. I want British pension schemes to draw lessons from the Canadian model to invigorate the UK economy. This approach promises better returns for savers and the potential for billions in investment. We are already witnessing pension schemes announce their investment plans, which reflects growing confidence in our efforts to strengthen the economy and enhance national prosperity.”
The announcement of the pension fund investment review has received strong support from various industry groups, including Legal & General, the BVCA, Aviva, Barclays, and Phoenix.
Recent developments include the launch of new investment vehicles aimed at channeling pension fund money into infrastructure projects and fast-growing UK companies. Notably, Phoenix and Schroders introduced the Future Growth Capital co-investment fund last week, which aims to invest up to £20 billion in the UK over the next decade.
Efforts to channel more pension fund money are complemented by initiatives to boost investment supply, including reforms to the planning system, the establishment of a National Wealth Fund, and a major overhaul of UK stock exchange listing rules.
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