The UK government is keen to attract more LGPS investment in the UK economy but amid a challenging macroeconomic outlook, is there still a case for greater allocations to the UK market?
The UK government’s LGPS Consultation launched in November highlighted the government’s interest in attracting more LGPS investment into the UK economy.
But amid anaemic growth, high levels of inequality and poor productivity, the UK has been dubbed “stagnation nation” be the Resolution Foundation.
This raises the question whether there is still an investment case for greater allocations to the UK.
Room151 sat down with Jason Fletcher, former CIO at London CIV to discuss the case for investing closer to home.
Fletcher, who has led the investment teams for two LGPS pools and spent more than 20 years as part of USS’ investment team argues that the core of the problem for the UK lies in chronic underinvestment combined with poor returns on investment.
He believes this is among others due to the economic impact of Brexit, but also poor decision making among policy makers, which has often been dominated by a short-term agenda.
But despite these headwinds, Fletcher argues that there is still a case for investing in the UK, most notably in the energy transition.
“The main opportunity for the UK is the carbon transition which is likely to account for 50% of new investments in the future as we make that move from old to new energy” he predicts.
The full conversation can be accessed here.
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