The Prime Minister and the Chancellor have called on the UK’s institutional investors to create a green ‘Investment Big Bang’ for long-term growth.

In an open letter to industry, they challenge UK institutional investors to consider investing a greater proportion of their capital in long-term UK assets enabling pensions savers to access better returns and support an innovative, greener future for the UK.

The letter, co-signed by the Prime Minister and Chancellor, says: “It’s time we recognised the quality that other countries see in the UK, and back ourselves by investing more money into the companies and infrastructure that will drive growth and prosperity across our country, we want to see UK pension savers benefitting from the fruits of UK ingenuity and enterprise, being given the opportunity to back British success stories, and secure higher returns and better retirements.”

The appeal comes as it has long been perceived that UK companies that have prospered have then been sold for immediate returns. However, some will question the sudden conversion of the political party that created, but then sold off, the Green Investment Bank.

The Government points out that global investors, including pension funds from Canada and Australia, are benefitting from the opportunities that UK long-term investments afford, while UK institutional investors are under-represented in owning UK assets. It cites the statistic that over 80 per cent of UK defined contribution pension funds’ investments are in mostly listed securities, which represent only 20 per cent of the UK’s assets.

Chris Cummings, chief executive of the Investment Association, said: “Getting this right will require a new partnership between the regulatory authorities and industry to ensure that pension funds, and retail investors, have access to transparent, well governed funds that return good value for money. The industry will look to work with pension scheme trustees, and their advisers, to deliver these outcomes.”

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