UK Pension Funds Commit £25 Billion Investment in National Economy by 2030

Seventeen of the UK's largest workplace pension providers, managing about 90% of active savers' defined contribution pensions, have agreed to the Mansion House Accord, pledging to invest 10% of their workplace portfolios in assets such as infrastructure, property, and private equity by 2030, with at least 5% ringfenced for the UK. This initiative is expected to unlock up to £50 billion in investment, directly releasing £25 billion into the UK economy, supporting clean energy projects, enhancing energy security, and fostering growth in science and technology sectors, thereby creating jobs and boosting incomes. The Accord builds on a previous commitment made under the Mansion House Compact in 2023, which targeted 5% investment in unlisted equities. The government and pension providers emphasize that these investments could improve pension returns and diversify assets, with comparisons drawn to higher private market investments by Australian pension schemes. This move is part of the broader UK government Plan for Change, following recent trade agreements with India and the US and aiming to strengthen economic growth amid challenges in global capital markets. The initiative is led by key industry bodies and is subject to fiduciary and consumer duties to ensure protections for pension savers.