Smart Pension has come out in support of the mandation clause of the Pension Schemes Bill in its current form, as the legislation returns to the Commons for a final vote on amendments.
The power of the government to mandate how pension schemes can invest has been in the Bill since its first draft, but was rewritten to match the aims of the Mansion House Accord, namely greater investment in domestic private markets, following debate in the House of Lords.
Even in its revised form, mandation has met resistance from areas such as industry body Pensions UK, which has stated that while it has “consistently opposed” such legislation, also conceded that the most recent changes abated its “most serious concerns” about the clause.
Shadow pensions minister Helen Whately is also in marked opposition to mandation, having stated at a Pensions UK conference that the approach was “a very wrong tack”.
However, Joe Dabrowski, director of policy at Smart Pension, has come out in support of the amended version of the mandation clause.
“The latest amendments to the Bill that tie the mandation clauses to the Mansion House Accord are a good compromise,” he says.
“In their revised format we think the amendments work in the short term, but we expect the market will move quickly to meet its commitments anyway. Dovetailing these measures makes sense and makes the proposal of a 2030 sunset clause a sensible option, by which point the justification for a regulatory intervention will have fallen away.”
Smart Pension also expressed confidence that through its investments such as that in Octopus Energy Generation, it would be able to meet the government’s investment targets for pension funds without the need for mandation.
Amendments to the Pension Schemes Bill are to be discussed and voted on the Houses of Lords and Commons today (15 April), then will be expected to be signed by King Charles and become law.