Reform for growth key message in chancellor’s Mansion House speech

The word ‘reform’ appeared 19 times in Reeves’ speech given at a dinner at Mansion House last night (November 14).

Firstly, she plans to reform the pension system by creating “megafunds” — a plan which had been formally announced earlier that day.

This would, in theory, enable schemes to deliver better outcomes for savers by achieving economies of scale while investing to grow the UK economy.

The reforms will be introduced through a pension schemes bill next year, consolidating defined contribution schemes and pooling assets from 86 Local Government Pension Scheme authorities.

In her speech Reeves said: “Australian pension schemes invest around three times more in infrastructure investment compared to defined contribution schemes in the UK and 10 times more in private equity, including in high growth businesses, compared to the UK.

“One of the key reasons for this is the much larger size of their funds while our pensions landscape remains highly fragmented. That means many of our pension funds do not have the capacity to invest at the scale required.

“And more often than not, it is Canadian teachers and Australian professors reaping the rewards of investing in British productive assets through their pension schemes rather than British savers.

“That’s not good enough and we need to change that.”

Reform for growth key message in chancellor’s Mansion House speech - FTAdviser