The next pension revolution

This week the Sunday Telegraph reported on Government plans to help people get better returns on their savings by encouraging pensions funds to invest in building and infrastructure projects.

The Government views this idea as a win-win situation, as it could help it to cover the costs of large-scale works while offering savers a potentially much better return on their savings.

There is also hope that the possible scale of interest gains will help address the recent discovery that 90,000 savers have stopped putting money in their pensions in order to avoid going over tax-free limits, which have been reduced.

Investment in British building and infrastructure works is already a mainstay of many international pension funds, which seems to have taken cabinet ministers by surprise.

For example, Canada’s Ontario Teachers’ Pension Plan, a major overseas investor, has billions of pounds invested in projects including HS1 and Birmingham, Bristol and London City airports.