Alan Rubenstein, chairman of the Pension Protection Fund (PPF) and Joanne Segars, chief executive of the National Association of Pension Funds (NAPF), have confirmed the launch of a new UK infrastructure platform for pension schemes. Speaking at the NAPF’s annual Investment conference in Edinburgh , the pair said that the platform would be in place by January.
The fund will initially aim to raise £2bn and Segars said that the NAPF and PPF are currently in talks with a variety of pension schemes to find 10-12 funds who are willing to be the first investors in the project. They claim that feedback from the industry has been good and so are optimistic over the platform’s future.
Rubenstein said: "We are not looking for a platform that solely focuses on infrastructure equity but also debt, there will be a 50/50 divide, as we see it. Pension schemes want to own whole projects so that income is flexible, easy, and is linked to inflation." The goal is to raise 2-5% over the RPI inflation measure. "We see it as a less risky investment than government bonds," Rubenstein said. The PPF’s chief executive added that the idea was simply to "take advantage of a natural supply of assets which offer good opportunities for schemes".
Who will run the scheme is as of yet undecided, though it is possible it will be run by a team set up for the specific purpose. In November George Osborne said the Treasury was seeking to raise £20bn through infrastructure, yet Segars said the current £2bn was a more realistic goal at the moment.