The £392bn local government pension scheme should be harnessed to address the UK’s underinvestment in affordable and social housing, think tank says.
A new report from Localis argues the Government should set up investment vehicles to use the assets held across the Local Government Pension Scheme (LGPS) to support the delivery of social housing.
It says encouraging institutional investment in social housing is in line with the Government's ongoing reforms to the LGPS, including the push for ‘megafund’ pools, and Labour’s wider focus on housing delivery.
Localis head of research, Joe Fyans, said: ‘[T]he LGPS can become a pivotal source of patient capital, contributing significantly to alleviating the housing crisis, supporting local economic development, and fostering national economic growth.’
He added: ‘The challenge lies in ensuring the right incentives and strategic tools are in place for all involved parties to deliver meaningful and impactful outcomes.’
Steve Simkins, public services leader at Isio, added: ‘The current LGPS surplus presents a unique and unexpected opportunity to drive affordable housing growth at a crucial time for the UK.
‘The scenario of some council revenue savings being directed to removing barriers to housing development, as the LGPS becomes more adept at local investment, presents a solution which can benefit our society as a whole.’
