UK Government challenges investors to create an ‘Investment Big Bang’ for a green recovery

The Prime Minister and Chancellor believe that now is the time to unlock the hundreds of billions of pounds sitting in UK institutional investors and help drive the UK’s green recovery from the pandemic.

In an open letter to industry, they challenge UK institutional investors to consider investing a greater proportion of their capital in long-term UK assets - from pioneering firms to infrastructure - enabling pensions savers to access better returns and support an innovative, greener future for the UK.

The letter, co-signed by the Prime Minister and Chancellor, says: "It’s time we recognised the quality that other countries see in the UK, and back ourselves by investing more money into the companies and infrastructure that will drive growth and prosperity across our country."

"We want to see UK pension savers benefitting from the fruits of UK ingenuity and enterprise, being given the opportunity to back British success stories, and secure higher returns and better retirements."

Currently, global investors, including pension funds from Canada and Australia, are benefitting from the opportunities that UK long term investments afford, while UK institutional investors are under-represented in owning UK assets. For example, over eighty per cent of UK defined contribution pension funds’ investments are in mostly listed securities, which represent only twenty percent of the UK’s assets.

On aiding a green recovery, the letter continued: "This Government is determined to Build Back Better, uniting and levelling up the country. By delivering our Ten Point Plan for a Green Industrial Revolution we will support up to 250,000 jobs, while also being the first generation to leave the natural environment in a better condition than we found it."

This letter comes ahead of the Investment Summit in Downing Street in October.

Anne Richards, Chief Executive of Fidelity International, said: "As both an asset manager and DC provider, we are committed to achieving the best outcomes for our clients and can see the benefits of making long term, less liquid assets available to both our DC and retail customers. We also believe our customers will welcome more choice and access to a wider investment universe."

"Making this a success will require a collaborative approach from a policy, regulatory, tax, industry and wider stakeholder perspective and we welcome the opportunity to work together to make it a reality."

6 August 2021

Climate Action