People’s Pension1, the UK’s largest commercial workplace pension scheme, has today announced it has signed the Mansion House Accord2 (the Accord), a landmark industry-led initiative.
People’s Pension is one of 17 pension schemes to sign the Accord, which commits signatories to the ambition of allocating at least 10 per cent of assets in their main provider-designed DC default funds to private markets by 2030. Within this, at least 5 per cent is targeted specifically for investment in UK private markets—subject to four critical enablers3, including the availability of suitable investable assets for providers4.
“Signing the Mansion House Accord reinforces our long-standing commitment to becoming a world class asset owner, to help our 6.9 million members build financial foundations for life,”
said Mark Condron, Chair of People’s Pension Board of Trustees.
He continued:
“Providing value to our members remains the key principle behind all of our investment activity, including in this area. Our continued growth in members’ assets, coupled with our growing in-house investment team5 means People’s Pension is now well-positioned to broaden our reach into these asset classes. To meet this ambition, we welcome the long-term support from the government to ensure a strong and sustainable pipeline of private investment opportunities.”
Patrick Heath-Lay, Chief Executive Officer of People’s Partnership, provider of People’s Pension, said:
“People’s Pension has a vital role to play in the exciting, shared vision for the future of the pensions’ industry, which will see bigger, stronger, value-driven schemes that will deliver better value to their members. By signing this Accord, we are reaffirming how seriously we take our commitment to delivering better outcomes, as well as helping to drive UK economic growth.”
Dan Mikulskis, Chief Investment Officer of People’s Partnership, added:
“As well as signing the Accord we have taken real, concrete steps to build the internal capability, and leverage our scale, to invest in private market assets in a way that leaves value in the hands of members and not asset managers.
“We look forward to continuing our philosophy of building deep partnerships with the right asset managers, alongside specialist internal capability to deliver the best outcomes for members. Current global risks highlight some of the benefits of UK assets which are also often cheaper to access than overseas alternatives leaving more value in the hands of members.”
The signing of the Accord follows the announcement earlier this year that People’s Pension would begin allocating a substantial portion of its assets under management to private markets, with a target of 10 per cent by 2030.
ENDS
Notes to editor:
1. People’s Partnership provides People’s Pension, one of the largest independent master trusts in the UK, serving nearly seven million pension savers across the UK and manages more than £30bn in assets. As a business without shareholders, it reinvests its profits with the aim to help customers and achieve better financial outcomes for everyone.
2. Mansion House Accord is a voluntary industry-led initiative to secure better financial outcomes for Defined Contribution savers by increasing pension investment into private assets.
3. For a successful delivery of this ambition, signatories underline the need, among other things, for the following critical enablers:
- a pipeline of UK investment opportunities, which the Government has agreed to facilitate
- the whole market, including intermediaries, to shift from cost to value, as well as successful delivery by the Government of the upcoming Value for Money framework
- alignment between the Government and FCA on that framework, on the scope of the charge cap and clarity in rules and guidance, and on delivery of the in-train policy change on bulk transfers without consent, when it is in the best interests of savers and subject to necessary safeguards
- a pragmatic, well-sequenced approach to the scale tests proposed by Government in a way that ensures competition and innovation in the market and that does not prevent signatories from investing in private markets at scale, in the near term
4. In January, People’s Pension published a report by investments expert Toby Nangle about how pension schemes might best approach investing in private markets: Achieving critical mass – People’s Partnership
5. Appointment of Co-Heads press release here