Commenting on today’s ‘Levelling Up the UK’ white paper, and the opportunity for illiquid investments, Callum Stewart, Head of DC Investment, says:

"In today’s ‘Levelling Up the UK’ White paper, the government has once again reiterated its commitment to relax DC charge cap rules to help encourage greater levels of investment in illiquid assets. Through the creation of new long-term asset funds, schemes will be able to access investments that could improve returns net of costs and charges over the longer term. The paper is evident of the willingness to explore illiquid investments.

“This will provide a vital opportunity to improve financial outcomes and will work to remove any remaining barriers preventing DC schemes getting the best for their members and should be seen as an exciting opportunity. This is another chance for pension schemes to improve engagement with their members. We know that individual DC savers have been telling the industry that they want their money to have a positive impact on the world around us, and that illiquid investments are a way in which to do this. Although costs and charges are likely to be higher than most existing DC funds, we continue to believe that in this instance it’s possible to pay more and get more for DC savers.”