Nigel Green, CEO of deVere Group, criticizes the UK Treasury's plan to force pension funds to invest up to 10% in private markets, with half directed domestically. He argues this policy endangers retirees by prioritizing government interests over the long-term growth of savers' wealth. The initiative, backed by Chancellor Rachel Reeves, seeks to invigorate UK markets but risks undermining fiduciary duties and reducing portfolio diversity. Green suggests improving market performance rather than coercing investment. He warns that trust in pension management could be severely impacted by the government's approach.
The purpose of a pension fund is to grow wealth for savers over the long term. That means investing wherever the most compelling returns are likely to be found.
Forcing pension funds to tilt portfolios toward one geography regardless of market conditions could distort asset allocation, reduce diversification, and expose millions of future retirees to lower performance.
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