William Eichler 15 June 2020

Pension ‘superfunds’ could aid post-Covid recovery, think tank says

Pension ‘superfunds’ should be created to invest in infrastructure as part of Britain’s post-Covid recovery, a think tank has argued.

A new report published by the Social Market Foundation (SMF) and sponsored by Tidal Power Limited proposes merging UK pension funds to create fewer, larger funds which would be able to invest large sums in big long-term projects.

The think tank said that ministers preparing for a post-coronavirus recovery should be ready to spend public money to support innovative ‘pathfinder’ infrastructure projects and new renewable energy markets.

Priority should also be given to ‘shovel-ready’ projects that support domestic supply chains and employment, according to SMF.

The Government launched consultations on pension consolidation and the creation of ‘superfunds’ in 2018 and 2019 but ministers have yet to announce decisions.

The SMF said that the need to support an economic recovery with infrastructure projects meant ‘urgent action’ is now needed on pension reform.

Investment rules should also be reformed to allow the new funds to pay the management fees often involved in running big infrastructure projects.

‘The best way to support the infrastructure the country urgently needs in the long-run is to make better use of the billions of pounds held in pension funds that could be profitably invested in helping Britain on its way to a green recovery,’ said Richard Hyde, senior researcher at the SMF.

‘Ministers should move quickly to encourage the creation of pension superfunds like those in Australia and Canada.

‘In the short-term, ministers looking to get infrastructure projects up and running and providing jobs should be prepared to spend directly to support pathfinders that can prove to investors that it is safe to invest in similar projects. That means taxpayers bearing more of the risk, but the long-term rewards justify that risk.’

SIGN UP
For your free daily news bulletin
Highways jobs

Assistant Director - Prevention and Service Development

North Yorkshire County Council
£86,252- £98,275 plus relocation support (up to £8,000)
Come and Join Team North Yorkshire! County Hall and around the county, including from home
Recuriter: North Yorkshire County Council

Principal Transport Development Planner

Suffolk County Council
£39,759 per annum (pro rata if part time)
A great opportunity to join the Suffolk County Council's Transport Strategy Team as a Principal Transport Development Planner. Suffolk County Council, Ipswich IP1 2BX
Recuriter: Suffolk County Council

Senior Manager - Asset and Network

Cheshire West & Chester
£56,593 - £62,792
This is a brand-new role developed out of our vision for the future of the recently established Transport and Highways directorate. Chester, Ellesmere Port, Winsford
Recuriter: Cheshire West & Chester

Provider Development Manager

North Yorkshire County Council
£50,183 - £58,379 plus relocation support (up to £8,000)
Come and Join Team North Yorkshire! County-wide – Hybrid
Recuriter: North Yorkshire County Council

Head of Integrated Care

North Yorkshire County Council
£60,567 - £69,001 plus relocation support (up to £8,000)
Come and Join Team North Yorkshire! North Yorkshire
Recuriter: North Yorkshire County Council

Partner Content

Circular highways is a necessity not an aspiration – and it’s within our grasp

Shell is helping power the journey towards a circular paving industry with Shell Bitumen LT R, a new product for roads that uses plastics destined for landfill as part of the additives to make the bitumen.

Support from Effective Energy Group for Local Authorities to Deliver £430m Sustainable Warmth Funded Energy Efficiency Projects

Effective Energy Group is now offering its support to the 40 Local Authorities who have received a share of the £430m to deliver their projects on the ground by surveying properties and installing measures.

Pay.UK – the next step in Bacs’ evolution

Dougie Belmore explains how one of the main interfaces between you and Bacs is about to change.