OECD warns against using pension assets for ‘pet projects’
The OECD has warned governments against tapping into private pension assets for “pet projects” as nations look to retirement scheme cash to help drive the post Covid-19 economic recovery.
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Trustees of pension schemes in the UK have a duty to act in the best interests of members, but in spite of their investment freedoms, their portfolios predominately invest in equities and bonds.
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Pension schemes with hundreds of millions of members globally are facing pressure from policymakers and industry to boost holdings of more expensive and riskier alternative assets, such as infrastructure and venture capital.
Pablo Antolin, a senior executive with the OECD, said the Paris-based international organisation had seen “a lot of pressure on pension fund managers and trustees to use their assets earmarked for retirement”.
“Those assets are an important asset for any society,” Mr Antolin, principal economist at the private pension unit of the OECD financial affairs division, said in an interview with the Financial Times.
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