Employers play a bigger role in pensions than imagined
Every link in the pension chain – from trustees to consultants to employers – has a part to play, writes Lady Mayor Susan Langley For many UK savers, their pension pot will become their single largest asset, bigger than their home. Yet too often the industry loses savers from the conversation entirely between the moment [...]
Pension systems worldwide demonstrate the importance of employer involvement in shaping retirement outcomes, a lesson the UK must learn. The UK's pension landscape currently lacks sufficient incentives for businesses to invest in domestic companies, resulting in missed opportunities for both citizens and the economy. The City Corporation's Mansion House Accord aims to change this by committing 17 major pension providers to allocate 10% of default fund assets to private markets in the UK by 2030.
However, to achieve this goal, a clear pipeline of investable UK opportunities and confidence in removing investment barriers are essential. The government's Sterling 20 initiative aims to serve as a trusted platform for testing and refining investment propositions. Employers must also recognize their influential role in the pension value chain, committing to a value-for-money approach through the Employer Pension Pledge.
To unlock the full potential of UK pensions, the focus should be on prioritizing long-term saver outcomes, fostering growth and diversification, and assessing value across the entire delivery chain. By addressing the barriers to investment and fostering innovation, the UK can deploy capital effectively, finance projects, and ultimately deliver better retirement outcomes for its citizens.
Written by urgent.news from City AM's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
