Member Article

Proposals could unlock £22bn of council infrastructure spend

Council infrastructure budgets could be boosted by as much as £22bn, under proposals from Local Government Secretary Eric Pickles.

The proposals could allow councils to double the amount they can legally invest from their pension funds directly into infrastructure projects.

Eric Pickles said: “Unlocking Town Hall pension pots so they can be used to invest in vital infrastructure projects is a common sense decision that will help this country complete on a global scale and get Britain building.

“By lifting the restrictions controlling local pension investments councils could pump a further £22bn directly into job creating infrastructure projects that will boost our economy.

“This is potentially a huge development and investment opportunity we simply cannot afford to ignore that also allows us to maintain long-term value for money for the taxpayer.”

Rhian Kelly, CBI Director for Business Environment, said: “Unlocking pension fund investment is critical to improving the UK’s infrastructure, so businesses will be heartened that Government is listening to the recommendations of the CBI and others, and taking action to lift barriers and attract new sources of funding.

“Local Government pension funds are some of the largest in the country and many already have experience of investing in infrastructure and housing. Infrastructure projects should be a natural fit for these funds, which have very long time-horizons and are looking for a healthy investment return. Lifting restrictions should allow them to take a more prominent role in deepening pension funds’ involvement in infrastructure financing.

“But we cannot afford to rest on our laurels. More must be done to ensure we deliver a pipeline of investable projects and ensure that the real priorities – the projects of national economic significance – are given all possible support.”

This was posted in Bdaily's Members' News section by Tom Keighley .