"In a letter to the chancellor, business leaders said the government must address a crisis in which pension investment in UK-listed companies has fallen from 53% of total equity holdings in 1997 to 4% this year. The signatories, including major pharmaceutical, financial services and health firms, said that to reverse decades of investment overseas, Labour should tell pension fund managers they must invest at least 25% of their equity holdings in UK shares."
"We urge you to be bold, the authors wrote, adding that the chancellor could make pension fund managers include a minimum 25% allocation to UK assets part of every default fund, forcing savers to opt out if they rejected the plan. This policy would set the default level of UK domestic pension investment closer to that of international competitors, the letter said."
More than 250 British company bosses urged the chancellor to use the budget to force pension schemes to channel extra funds into domestic businesses, potentially increasing private investment by as much as 95bn. They highlighted a fall in pension investment in UK-listed companies from 53% of total equity holdings in 1997 to 4% this year. Signatories from major pharmaceutical, financial services and health firms proposed that pension fund managers be required to invest at least 25% of equity holdings in UK shares, and that defined contribution schemes change default rules to include a minimum UK allocation, with opt-out for savers.
Read at www.theguardian.com
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