London Stock Exchange: Decline in UK Funds

Lord Howell of Guildford Excerpts

Thursday 13th February 2025 Lords Chamber

[Lord Livermore (Lab)]

I am grateful to the noble Baroness for her question, and she knows I agree with her analysis of the effects of Brexit. Firms may, of course, choose to list in other countries for a variety of reasons, and the Government appreciate that there is a perception that firms, especially tech firms, will have larger valuations in the US. We are determined to change that perception, which is why the Government are taking forward an ambitious programme of reforms to boost the attractiveness of UK markets and to support firms to start, scale, list and, importantly, stay here. As she knows, through the Government’s work on the EU reset, we will absolutely strengthen our relationship with the European Union.

[Lord Howell of Guildford (Con)]

Does the Minister know that Australian pension funds invest 80% in Australia? Thirty years ago in this country, it was 40%, and in earlier years it was 60% and 70%. It seems to me that the situation is rather more serious than just “looking at further ways”. Does the Minister agree that if we really are to attract more FDI and sovereign wealth funds and create an attractive centre for high-innovation investment in this country, we need something a little beefier than what he has indicated so far?

[Lord Livermore (Lab)]

I am grateful to the noble Lord for his question, and I agree with every word he said. We have been very guided by the Australian experience. We have been clear that UK pension funds are investing a lot less in the domestic economy than overseas counterparts. Australia and Canada are two that have been spoken about. He talks about beefier measures, but the pensions review is the most fundamental review of pensions for a generation, and it is actively considering what further interventions may be needed by the Government to ensure that our reforms to the UK pension system benefit UK growth.