Chancellor, Jeremy Hunt, is set to outline plans to ‘unlock’ pensions capital for high-growth businesses and boost saver outcomes at today’s (10 July) Mansion House speech, with ‘three golden rules’ to guide the proposals.

Hunt’s first Mansion House Speech is expected to include plans to use Britain’s financial services sector to support the Prime Minister’s priorities on UK growth, with specific measures to be announced to encourage greater investment for high-growth businesses.

The wide-ranging package is set to build upon the Edinburgh Reforms previously announced in December 2022, and comments made in the 2023 Spring Budget.

The reforms will be guided by the Chancellor’s three golden rules, the first of which seeks to secure the best possible outcomes for pension savers, placing their needs 'first and foremost' in any potential changes to investment structures.

Alongside this, Hunt is expected to announce his intent to prioritise a strong and diversified gilt market, confirming that it will be an “evolutionary not revolutionary” change to the pensions market.

In addition to this, Hunt's third 'golden rule' will require any decisions taken to “always strengthen and never compromise” the UK’s competitive position as a leading financial centre able to fund the UK’s precious public services.

Despite industry concerns over mandating, reports have suggested that the Chancellor will instead announce that a number of UK pension schemes have voluntarily committed to investing 5 per cent in unlisted securities by 2030.

LCP partner, Stephen Budge, welcomed this news, arguing that members of DC schemes "rightfully deserve the best investment strategy to maximise the potential value of their savings at retirement".

"So its great to see initiatives such as this challenging trustees and industry on supporting access to potential return drivers outside of the traditional asset classes, ones which can deliver meaningful change for members and which are much more commonly accessed in DB pension schemes and DC schemes in other countries," he continued.

"We think this initiative provides a great opportunity to make a real difference to members’ retirement savings.”

In addition to specific measures in the pensions space, the Chancellor is expected to announce plans to make UK capital markets more attractive for business and grow the economy.

As part of this, the Chancellor is set to simplify the rules for buying and selling shares, improve research facilities, deliver higher returns for investors, and lay out plans for an "entirely new kind of stock exchange", which allows private companies to access capital markets without floating on a stock exchange.

The new measures will look to simplify prospectuses, meaning that the document a firm must produce for any would-be investor is easy to produce, accessible, and understandable.

Commenting ahead of the Chancellor’s speech, Investment Association chief executive, Chris Cummings, stated: "The recognition of the central role of long-term investment is the foundation of successful policy.

"With the right regulatory framework, pension schemes will be able to invest productively and sustainably, unlocking further investment for innovative growth companies, and improving returns for savers by broadening investment options.

"In tandem with reforms to the listings regime, this will help the UK to become a more globally attractive place for companies to list, invest and do business.

"Achieving this new economic dynamism will require the government to bring together regulators, policymakers, and businesses, to create a forward-looking and internationally competitive investment framework, based on a stable, long-term policy approach.

"Delivering these outcomes will require us to strike the right balance between risk and reward and between protection and innovation. Investment managers stand ready to play our part.”

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