Magazine article Public Finance

Funds Warn on Investment Plan

Magazine article Public Finance

Funds Warn on Investment Plan

Article excerpt

A senior local authority figure has warned ministers that plans for pension funds to invest in national infrastructure developments will not be approved 'just to dig the government out of a hole'.

Councillor Ian Greenwood, chair of the Local Authority Pension Fund Forum, told Public Finance that he would not vote for the plan 'unless it's absolutely in the members' interests'.

Chancellor George Osborne announced in the Autumn Statement that a Memorandum of Understanding had been signed with the National Association of Pension Funds. This agreement could provide up to £20bn of private investment in public infrastructure, he said.

'We need to put to work the many billions of pounds that British people save, in British pension funds, and get those savings invested in British projects,' he said. "You could call it British savings for British jobs.'

Osborne said the government had identified more than 500 infrastructure projects it wants to see built over the next decade and beyond, where this cash could be used.

Local government pension funds could be among the investors, with two - the Greater Manchester Pension Fund and the London Pensions Fund Authority - specifically highlighted by the government.

But Greenwood, whose body represents 54 public sector pension funds with combined assets of more than £100bn, said that as chair of the pension fund forum he would want to ensure investments would benefit members.

He said: 'My view, very strongly, is that when you're acting as a pension fund trustee, you should act on behalf of the beneficiaries of the scheme. …

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