Major pension funds and insurers launch new bid to help boost growth in the UK

Twenty of Britain's biggest pension providers and insurers are set to launch a new investor-led partnership in a bid to boost growth. The Sterling 20 will be established at the Regional Investment Summit in Birmingham on Tuesday (October 21), with the Government and City of London Corporation.

The Government said the initiative will help boost affordable housing, improve broadband connections in rural areas and provide scale-up finance for growing businesses. L&G (Legal & General) has kicked off the investment drive with a £2billion commitment by 2030, delivering around 10,000 more affordable homes and supporting the creation of 24,000 jobs nationwide, according to the Government.

Nest will also provide Schroders Capital with £500million - of which £100m is expected to be channelled into UK investments over the coming years. In addition, Nest will invest £40m, to help bring reliable broadband to rural homes and businesses.

Chancellor Rachel Reeves said: "This is about getting Britain building again - bringing our savings, our investors and our regions together to deliver the homes, infrastructure and industries that will drive growth and create good jobs in every corner of the country.

"Our country's pension funds are some of the biggest in the world... Sterling 20 shows what can be achieved when we all pull in the same direction to build a stronger economy that works for, and rewards, working people."

News of the partnership comes after the Government announced its Mansion House Accords in May. The agreement with pension funds was hailed as unlocking up to £50bn of investment in UK businesses and infrastructure.

Antonio Simoes, Group Chief Executive at L&G, said: "Our £2billion commitment, targeted at housing, infrastructure and urban regeneration, will help unlock the investment needed in productive assets across the country - creating jobs, strengthening communities, and driving both regional and national growth."

Nest's Chief Executive, Ian Cornelius, said: "We believe private assets can play a key role in delivering strong, consistent returns for them.

"That's why the UK, with its exceptional investment opportunities, is a cornerstone of our strategy. From major infrastructure projects to ambitious small businesses, our investments are helping support economic growth across the country."

He said £4bn has already been committed to UK private markets and by 2030 the total is expected to rise to around £12bn.

The Regional Investment Summit will also see AustralianSuper, Australia's biggest pension fund, increase its investment in Britain's housing market, according to the Government.

Bosses from the fund will meet the Chancellor at the summit. Ahead of this, AustralianSuper announced a new UK platform dedicated to investment in rental homes.

Pensions minister Torsten Bell said Britain's pensions system is one of the country's great strengths.

He added: "We're stepping up the pace of pension reform to support not just British pension savers but the British economy, supporting investment to deliver the growth of communities up and down the country."

Members of the Sterling 20 are Aegon, Aon, Aviva, L&G, LifeSight by WTW, Mercer, M&G, NatWest Cushon, Nest Corporation, NOW Pensions, People's Partnership, Phoenix Group, Royal London, Smart Pension, SEI, TPT, USS - Universities Superannuation Scheme, Rothesay, Pension Insurance Corporation, and Pension Protection Fund.