Mrs Kataora added that while Britain had the fourth largest pensions market in the world, worth over $2 trillion (£1.6 trillion), its businesses and infrastructure projects often fell into the hands of foreign pension funds.
The operator of the National Lottery, Camelot, was owned by the Ontario Teachers’ Pension Plan for almost a decade. Meanwhile, AustralianSuper helped to bankroll Heathrow Airport during the pandemic, as well as the King’s Cross redevelopment project in London.
However, critics have suggested that state interference in pension investments must be carefully balanced against the interest of savers.
Tom Selby, of the broker AJ Bell, said: “Pension funds’ duty is to maximise how much savers will receive in retirement. That will involve investment in countries around the world, and while that will include some British assets, it should not be because of some sort of patriotic duty. It should be because it is simply a good investment.”
Unlike most British pension funds, where investment managers must consider the risk appetite of each individual saver, Australian and some Canadian pension funds pool workers’ assets together. This scale means that they are able to take greater risk and secure higher returns.
Mrs Kataora added: “Australia and Canada are way ahead of us in terms of this model. Some Australian ‘superfunds’ have as much of a third of their whole pension scheme in infrastructure assets, whereas in the UK we are talking about 5pc.”
However, these investments often come at a higher cost. Mr Glancy said: “The Australian system is very expensive. Charges can be two to three times as high as they are here. It might work, but there is no guarantee that after costs you will definitely get a bigger pension. There has to be a balance.”
