PLSA AC 23: Industry urged not to 'short-change' UK; consultation updates expected in Autumn Statement

Economic Secretary to the Treasury, Andrew Griffith, has argued that the industry should be “bullish” about the UK, confirming that further updates on the Mansion House reforms and recent consultations are set be shared at the Autumn Statement

Speaking at the PLSA Annual Conference 2023, Griffith said that he saw “no conflict whatsoever” between "unleashing" productive capital into some of “fastest growing and scaling” parts of the UK economy, whils also delivering benefits to beneficiaries.

He also acknowledged that the pensions industry is “absolutely central to that endeavour”, welcoming the industry feedback on the recent Spring Budget consultations and Mansion House reforms.

"I do think we should all be bullish about the UK," he continued.

"It's a fantastic place to put capital to work and the challenge is to go back and make sure that in the pursuit of delivering the best performance for people, because that's the thing none of us will be forgiven for if we don't deliver people the best returns, that we make sure we’re not short-changing the UK when so many other people in the world see this as a fantastic place to put capital."

Griffith also highlighted some of the work already underway to support greater investment in the UK economy, such as the UK Infrastructure Bank, suggesting that “one of the challenges is not just these opportunities being investable, but often it's finding them”.

Alongside institutional capital and private capital, he said that pension capital will be “incredibly important”, and potentially “the most important element, because it is trying to do those two jobs of invest productively to deliver returns that are both prudential but give performance for long-term savers."

Although Griffith acknowledged that this is “an incredibly busy moment in time for reform”, he said that “revolutions happen through the application of marginal gains”, each of which will be informed through consultation with the industry.

“We put out some thoughts and consultations and Spring Budget and you can expect more to hear more from them on from us on that at the Autumn Statement," he confirmed.

Griffith was also asked specifically about superfunds and the push towards consolidation, arguing that “it’s not consolidation for the sake of consolidation”.

“It's not picking an arbitrary point and saying that if things were consolidated, that would automatically be better,” he explained, pointing out that the flipside of consolidation is scale.

However, Griffith admitted that "we'd all be kidding ourselves if we did not think the direction of travel of UK pensions was for more consolidation".

More broadly, Griffith also confirmed that concerns around the lack of flexibility in the draft defined benefit funding regulations is “firmly in the scope” of the government’s current review of the proposals.

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