19 November 2024

UK – November 2024] ZEDRA, the award-winning provider of pension and incentive services, today have shared their thoughts on the latest interim report of the Pensions Investment Review.

Colin Richardson, Director at ZEDRA commented, “With the government policy attention on driving growth for UK Plc, we mustn’t lose sight of the fundamental principle that our focus is to deliver strong and safe results for the savers in the pension schemes that we look after.   Investment in private markets, infrastructure and other growth assets will be assessed in this way. With no incentives or additional support to invest in UK assets in the Pensions Review, UK investments will need to pass this test against opportunities in all asset categories available worldwide and, if they don’t, the Chancellor may be disappointed.

That said, greater investment in productive finance should be a win-win, providing additional returns to increase workers retirement savings and promoting economic growth. Scale is an important enabler for increasing investment in productive finance but needs to be attained carefully.  The DC transition to the prospective 2030 position will be extensive, and both main points of detail and the interaction with the Value for money framework due for 2027 onwards are unclear.”

“Regulations need to work together. The danger is that growth and productive finance objectives are undermined with an approach that achieves scales but drives herding of investment approaches rather than rewarding performance and stifles innovation which then reduces returns in the long term. Retirement savers need returns, and scale is useful only when it supports their returns in the long term.”

 

-ENDS-