Government should consider allowing National Wealth Fund to issue bonds

The Government has said that it is it reform pensions rules to try to drive growth and investment.

 

Among the suggested plans are an idea to allow pension funds to invest surpluses in things lke infrastructure projects.

Mike Clancy, General Secretary of Prospect, said:

“It is welcome that the government is exploring how pension funds can support greater investment in the UK, however it is essential that the interests of pension scheme members are prioritised.

“There are currently large surpluses in DB pension schemes, but this is not likely to continue indefinitely and any decisions taken must support the sustainability of funds in the long-term.

“Both government and scheme trustees should proceed carefully in this process, ensuring guardrails are in place to protect against any change in economic conditions.

“Finally, government should explore options for creating more mechanisms for pension funds to invest in long term infrastructure priorities, such as allowing the new National Wealth Fund to issue its own bonds, which would be likely to attract investment from pension schemes.”