L&G boss slams pension funds’ slide away from UK markets
The chief of Legal & General has slammed a slide in pension funds’ equity holdings today as calls grow for the City’s top institutional investors to back the UK stock market.
Speaking with media today, L&G boss Sir Nigel Wilson said pension funds’ shift towards bonds over the past two decades had hampered growth of London-listed firms.
“A big thing that we’ve done is de-equitize,” Wilson said. “Since Gordon Brown in 1997 started taxing pension funds in an unusual way, and created a huge amount of money for the Treasury, it’s led to systemic under investment in equity, particularly growth equity here in the UK.”
His comments come amid a wider pressure campaign on pension funds to ramp up investment in domestic firms. City A.M. revealed talks in January between tech figures and pension fund chiefs to boost investment into start-ups via a pooled £50bn Future Growth Fund.
Wilson similarly blamed the shift away from equities for the UK’s capital markets decline in recent weeks, saying pension funds “have been in perpetual drift” away from London.
“There’s a drift of the City to Europe, there is a drift of the City to the United States,” Wilson told the Financial Times.
In January it was announced that the respected City grandee will step away from the top job after more than a decade at the helm.
Wilson will, however, stay with L&G until a successor is found, with the firm expecting that process to last around a year.