UK finance minister Rachel Reeves announced a package of reforms for financial services in her first Mansion House speech, one aspect of which will see the launch of a pilot to deliver a digital gilt Instrument, using distributed ledger technology (DLT).
David Postings, chief executive of UK Finance, said in a statement: “The Chancellor has listened to industry and is delivering across a range of areas we have called for action on, including a digital gilt, tackling payment fraud, reforming the Financial Ombudsman Service, supporting green finance, and the National Payments Vision.”
She also announced the creation of “pension mega funds”. Two consultations will be published ahead of the Pension Schemes Bill in the Spring to merge defined contribution pension schemes and the Local Government Pension Scheme in England and Wales into megafunds – mirroring the pensions landscape in Australia and Canada. This, along with reforms to ensure better value from these pension schemes, could unlock around £80 billion new investment in businesses and infrastructure.
Two UK pension funds have shown support for a future launch. Aegon UK – as a substantial cornerstone investor – and NatWest Cushon, who have combined assets worth over £219 billion, have both agreed to work with the British Business Bank with a view to investing in the “UK growth companies of the future”.