MP retirement savings have been pulled out of British companies – despite the Chancellor pushing pension schemes to invest tens of billions in UK business.

Jeremy Hunt has called on pension funds to plough at least 5pc of their assets into British start-ups and private equity in a bid to boost growth.

However, his own Parliamentary pension scheme now invests just 1.7pc (£14m) in British companies, down from nearly 12pc the year before.

When Mr Hunt first announced the policy at his Mansion House speech in July, he said the move could unlock up to £50bn in investment for fast-growing, but high-risk, businesses by the end of the decade.

Ministers also estimated that the reforms could increase the size of the average pension pot by more than £1,000 a year in retirement.

But critics said start-up companies were inherently riskier investments, and the Government’s own analysis also revealed that once high fund management fees are taken into account, the average pension saver could actually be £1,300 worse off.

Pension consultant John Ralfe today said that Mr Hunt and MPs were not “setting a good example” by ditching UK companies while pushing the British public to risk their pension returns in an attempt to boost the economy.

The Parliamentary contributory pension fund, which Mr Hunt is a part of, promises a pension income for life, based on average career salary, length of service, and age. Yet the majority of private sector pensions rely on investment growth alone.

At an industry conference earlier this month, the state-backed Nest pension fund, which has more savers than any other in the country, said it was reluctant to invest more in younger British companies simply for the sake of levelling up.

And speaking on Wednesday Nausicaa Delfas, the chief executive of The Pensions Regulator, said: “Trustees have a duty to act in savers’ best interests. That means delivering retirement incomes that savers expect, including considering the full range of investment options.”

Simon Harrington, of industry body PIMFA, said: “While we are supportive of the Government seeking to encourage UK savers to take a real stake in the UK economy, this shows the limits of that ambition.

Read more @telegraph