Unlock the digestive of free editor
Roula Khalaf, the FT editor, chooses her favorite stories in this weekly newsletter.
The main managers of the funds have announced at a meeting on Downing Street that feeling towards the London stock market is at the “Rock End” and called on ministers to consider the obligation of UK pension funds to distribute at least 5 percent of their domestic capital investments.
A group of capital specialists in the United Kingdom led by Nick Lawson, Ocean Wall Investment Group Chief, this week met with Varun Chandra, a special government adviser to discuss ways to revitalize public capital markets.
Fund managers described their concerns about the state of capital market in the UK and the feeling of agreed investors was at the “Rock End”.
The meeting highlighted some challenges, including the fact that the UK market deletions are overcoming new initial public offers, a strict appreciation gap between the United Kingdom and the SH.BA, and the thought that UK companies are being cheaper by private capital and foreign buyers.
Participants also said companies were facing a “penalty loop” caused by internal pension funds being net capital seller in the UK for nine years.
The meeting came a day after the food distribution company at the US Dobordash struck a £ 2.9 billion agreement for the UK rival, four years after it sailed to London with a 7,6 billion rating and was called by one of its worshipers “the worst in London history” – it lost more than a quarter of its value in the first day.
As evaluating a key factor to decide where companies choose to rank, prolonged subformation in the UK has made them look abroad, especially in the US listing costs and burdens are also quoted as outside.
Participants in Downing Road meeting makes the issue of collecting domestic capital allocations for British pension funds, including through Mandation.
Purpose of 5 percent, 8 percent and 10 percent were discussed as reasonable threshold to consider, and there was a broad agreement that the schemes of contributions should be prioritized on the defined benefits schemes.
“If the UK pension funds go to 10 percent, it would be a heroine shot for the UK markets,” Lawson said, adding that he was in favor of “Gently run Mandation”.
Some participants in the meeting suggested that such a change may warn a much broader “virtuous circle” that would benefit companies, markets and savers by restoring confidence and supporting assessments.
But the concept of mandation is very controversial.
Pension fund executives say making mandatory investment goals would “open a cans of worms” and cut their task of trust to ensure the best possible return to investors.
Pension funds are expected to sign a voluntary compact this month – an updating of the 2023 residence house signed under the last conservative government – to invest 10 percent in private assets by the end of the decade, half of that in the United Kingdom.
However, FT realizes that there will be no specification to invest in the shares listed.
Although former cancer Jeremy Hunt considered it mandation, he did not introduce politics before last year’s elections. Chancellor Rachel Reeves did not rule out the idea, but ministers are in doubt.
Mel Stride, the Chancellor of Shadow, said the idea destroyed by despair, telling the Financial Times this week: “Pension funds should be free to make investment decisions based on what is best for savers.”
Fund managers at the meeting included veterans shareholders such as David Cumming, the head of the United Kingdom Capital in Newton Management Investment, Andy Brough from Schroders and Michael Stiasny, Chief of UK Capital in M & G Investments.
A person close to thinking of the National Employment Savings Trust – the largest UK contribution pension scheme that is supported by the government – said his priority was to invest in the best way for its members, but added that the fund had been public in his commitment to invest in the United Kingdom.
Nest, who manages over £ 50 billion, said about 1.75 percent of the total of his assets were invested in the UK capital in late March. Liz Fernando, the main investment official in Nest, told FT in an interview that she had “actively encouraged” all Nest partners managers to seek assets in the UK.
A government spokesman said ministers were seeking to ensure that “businesses could enter the finances they need to grow”. The spokesman added: “It is right that we engage with the stakeholders as part of this.”
“The final retirement review report will be published soon and this will consider how to provide any benefit of the UK unblocked investment.”
