Places for People’s fund management arm welcomes government’s pensions review

The first phase of the review will focus on investment and will report initial findings later this year.

Ms Webster said: “We welcome the review. It is key for the growth of the housing sector to bring in new sources of capital, as traditional sources of capital for housing delivery (registered providers) are focused on improving existing stock and are not growing pipelines, and in many cases have decreased housing delivery.

“LGPS is investing and continues to allocate funds, and this continuance is welcome. DC funds could be a very strong source for the future if investment in private (illiquid) markets can be increased.

“Investment in this sector – with investment managers who have the track record and capability to manage the homes and communities well – will provide stable and good financial returns with tangible social impact alongside good UK/local economic activity with raw materials demand and employment growth.”

The first phase of the review

The government has revealed that the first phase of the review will focus on developing policy in four areas.

These include tackling fragmentation and inefficiency in the LGPS through consolidation and improved governance, and driving scale and consolidation of DC workplace schemes.

It also covers the structure of the pensions ecosystem and achieving a greater focus on value to deliver better outcomes for future pensioners, rather than cost; and encouraging further pension investment into UK assets to boost growth across the country.

In developing its recommendations, the review will consider a range of areas.

These include: improving the affordability and sustainability of the LGPS in the interest of members, employers and local taxpayers; the role of pension funds in capital and financial markets to boost returns and UK growth; and boosting returns for pension savers.

It will also cover any implications for wider government financial stability policy objectives, for example around the gilt market, which will need to be considered in the context of public finances.

Recommendations will also consider a wide range of external viewpoints, including from employers, trade unions, the pensions industry, financial services, local government and consumers.

The first phase of the review will focus on investment. It will report its initial findings later this year and ahead of the introduction of the Pension Schemes Bill.

According to the government’s background briefing paper for the King’s Speech, the bill will support over 15 million people who save into private-sector pension schemes get better outcomes from their pension assets
and support the government’s mission to deliver growth.

The second phase of the pension review will start later this year. Alongside investment, it will consider additional steps to improve pension outcomes, including assessing retirement adequacy.

The government added that ongoing policy development with respect to defined benefit workplace pension schemes will remain separate from the review.

The review is being led by Emma Reynolds MP, who has a joint ministerial role across the Treasury and the Department for Work and Pensions.