More than eight in 10 UK pension savers want to know more about how their pension money is invested in infrastructure.
This is according to research by IFM Investors, Nest and Border to Coast Pension Partnership.
The research was conducted by Ignition House and includes a survey of 2,000 UK defined benefit and defined contribution pension holders as well as a week-long qualitative study with 20 savers.
It found that 55 per cent of savers initially felt positive about a small proportion of their pension being invested in infrastructure and rose to 72 per cent after they were given more information and case studies.
Around 39 per cent said the information had made them more positive about infrastructure investment.
It also found that 65 per cent were more likely to support infrastructure investment in their local area after learning about the range of projects it can fund, such as energy, housing, transport and digital networks.
IFM Investors head of client services, UK & Ireland Phelim Bolger says: “The message for the industry is clear: when pension savers can see how infrastructure investment supports both their retirement and the economy around them, they become more engaged, more confident and more supportive.
“As a pension-owned infrastructure investor, we see a real opportunity to help schemes tell that story more clearly: how long-term capital supports the essential infrastructure people rely on every day, while helping to deliver better outcomes for members. Pension capital is already backing critical infrastructure across the UK and, with the Mansion House Accord targeting a five per cent allocation to UK private markets, the industry has a timely opportunity to work together to demonstrate that impact more clearly. Doing so can help build greater understanding, confidence and trust in the pensions system.”
Nest Invest chief investment officer Elizabeth Fernando says: “At Nest, our priority is to invest in our members’ best interests. Around 8% of our assets are already invested in UK private markets, helping finance the homes, transport, energy and digital networks communities will rely on in the years ahead.
“Clear, accessible information can help savers see how their pension supports local communities and connects to their financial future. As schemes explore long-term opportunities, we must help members understand the benefits of these investments and the role they can play in delivering value for members over the long term.”
Border to Coast Pension Partnership chief stakeholder officer Ewan McCulloch says: “The pension offered by the Local Government Pension Scheme (LGPS) plays a major role in attracting and retaining local workers and so engagement is generally high. As such, LGPS schemes have traditionally been proactive in communicating with members, which in turn creates a virtuous circle. Plus, the councillors on Pension Committees are also members, which keeps the voice of the member central. There is always more to do – and it’s also true that DC schemes face more challenges – but the positives that come from better member understanding and engagement has been a key feature within the LGPS and a lead that others could follow.”