Tag: Toronto

Chancellor Reeves: Pension funds can fire up the UK economy

  • Chancellor Rachel Reeves calls on UK pension schemes to invest more in the UK economy and deliver better returns for savers
  • Wants UK to learn lessons from ‘Canadian model’ ahead of meeting with major Canadian retirement funds
  • Reeves confirms first Mansion House address will focus on financial service sector’s role in delivering more investment and financing growth as work continues to fix foundations of the economy, rebuild Britain and make every part of the country better off

The Chancellor Rachel Reeves has called on pension funds to “learn lessons from the Canadian model and fire up the UK economy”.

The Chancellor hosted a roundtable with the so-called ‘Maple 8’ group of Canadian retirement funds in Toronto on Wednesday (7 August), who have invested billions of pounds in the UK economy in recent years.

She will urge the funds to continue backing Britain and take home lessons about how consolidation of pension schemes into larger funds can help drive investment in productive assets such as vital infrastructure and high-growth businesses.

The meeting is part of intensive industry engagement for the landmark review of pension fund investment announced last month to boost investment in the UK and deliver higher returns for people’s pension pots.

Also on the Chancellor’s agenda to deliver more investment and finance growth is the financial services sector, with Rachel Reeves confirming her first Mansion House address will set out how she will work in partnership with industry and regulators to deliver growth.

This will include delivering the stability the sector needs to grow, the support it needs to invest across the UK and reforms it needs to remain at the cutting-edge of new innovations and technologies.

Chancellor of the Exchequer Rachel Reeves said: “The size of Canadian pension schemes means they can invest far more in productive assets like vital infrastructure than ours do.

“I want British schemes to learn lessons from the Canadian model and fire up the UK economy, which would deliver better returns for savers and unlock billions of pounds of investment.

“We’re already beginning to see schemes announce plans to invest. That’s a vote of confidence in our work to fix the foundations of the economy, rebuild Britain and make every part of our country better off.”

Industry strongly welcomed the announcement of the pension fund investment review, with supportive comments made by groups such as Legal & General, the BVCA, Aviva, Barclays and Phoenix.

New investment vehicles have since been announced to channel pension fund money into infrastructure and the UK’s fastest growing companies. Last week Phoenix and Schroders launched their Future Growth Capital co-investment fund, which will invest up to £20 billion in the UK over the next decade.

Channelling more pension fund money will release investment demand and comes alongside measures to unlock supply through fixing the broken planning system, setting up a National Wealth Fund and the biggest overhaul of listings rules for the UK stock exchange.

Britain is open for business: Chancellor visits North America in investment drive

  • Rachel Reeves to bang the drum for Britain in visit to New York City and Toronto this week.
  • Chancellor to share her vision for growth and champion UK sectoral strengths across financial services, clean energy and infrastructure to investors and CEOs.
  • Trip to build momentum for the International Investment Summit on 14 October.

Chancellor Rachel Reeves has visited New York and Toronto this week with the message that Britain is open for business.

She met with CEOs and senior representatives from major players across the US and Canada’s foremost industries, highlighting that early steps taken by the government to fix the foundations and restore economic stability makes the UK an attractive destination for investment.

Chancellor of the Exchequer Rachel Reeves: “I’ve wasted no time in my first month in office in taking the difficult decisions necessary to fix the foundations of our economy, so we can rebuild Britain and make every part of the country better off.

“That means restoring economic stability so we can attract the investment needed to create good jobs, boost wages, and improve opportunity across Britain.

“There is no credible plan for growth without private sector investment. That’s why I’m breaking down barriers at home and banging the drum for Britain abroad as we gear up to host the International Investment Summit.”

While in New York, the UK’s first female Chancellor of the Exchequer met with Wall Street leaders and host a reception to celebrate women in finance.

The US is the UK’s biggest financial services trading partner, with UK exports to the US valued at £23.4bn annually. The sector is at the heart of the government’s core mission to deliver sustainable economic growth as a jewel in the crown of the UK economy and one of its success stories, contributing almost 10% of UK GVA and employing 1.2 million people.

In Toronto, the Chancellor met with names in the world of clean energy and infrastructure. The government’s mission to make Britain a Clean Energy Superpower will bring opportunities for economic growth whilst helping the UK meet its target of clean power by 2030.

That mission has started in earnest with the creation of Great British Energy to partner with the private sector and secure the investment needed to accelerate the transition, the sweeping away of barriers to onshore wind farms, and a record £1.5 billion budget for this year’s renewable energy auction to get Britain building green.

During her time in the US and Canada, Reeves has pointed out that the government has moved quickly to create a stable environment where businesses have the confidence to invest in the UK.

This has included reform of a planning system that has long frustrated investment, ending the ban on on-shore wind and the establishment of a National Wealth Fund, backed by £7.3 billion to catalyse further private investment in our world-leading green and growth industries of the future.

The UK is already Europe’s leading hub for investment, with UK markets raising more capital than the next two highest European exchanges combined in 2023.

The Chancellor visited North America with a renewed purpose to build upon this, with it being announced yesterday that Britain is to play host to the International Investment Summit on 14 October.

In doing so, Ms Reeves is looking to deepen the strong economic relationship between Britain and the two North American countries.

The United States is the largest source of foreign investment in the UK and the UK is the third largest investment destination for Canadian companies, whom invested more than $73 billion of FDI stock in 2021.