‘We simply haven’t built enough’: L&G chief calls on pension funds to invest in projects to help end housing crisis
- L&G boss Nigel Wilson believes we haven’t built enough homes
- L&G has already backed a number of projects across the country
- It has invested £450million in the regeneration of Cardiff Central Square
The boss of Legal & General has urged pension providers to help tackle the housing crisis as Britain emerges from the pandemic.
Nigel Wilson, chief executive of the FTSE 100 insurance giant, said pension funds are sitting on billions of pounds and should invest in projects to help resolve the housing shortage and to regenerate local communities.
Wilson said: ‘People have recognised that housing is a problem in the South-East as well as other parts of the country. We simply haven’t built enough. London is a fantastic example of that. We will see in the next financial year that places will get co-investments directly from pension funds to try to get some of this scaled up meaningfully.’
‘We simply haven’t built enough’: L&G boss Nigel Wilson said pension funds are sitting on billions of pounds and should invest in projects to help resolve the housing shortage
His comments come after Chancellor Rishi Sunak revealed in the Budget that the Government will review rules to give pension providers a greater choice of investments to kickstart the economy.
The review could make it easier for them to put money into the redevelopment of affordable homes. It could also ease the way for them to offer financial boosts to technology start-ups.
Wilson pointed out that infrastructure and housing projects offer enticing returns over the long term compared to bonds. The yield on ten-year UK Government bonds is less than 1 per cent.
He said more pension funds and insurers need to get involved if there is to be a real impact on rebuilding local economies.
Andy Briggs, chief executive of Phoenix, the UK’s largest retirement business, told The Mail on Sunday earlier this year that he was keen on seeing changes to rules that make it easier for pensions to invest in a broader range of assets, offering better returns to retirees.
L&G, which manages about £1.3trillion for savers, companies and retirees globally, has already backed a number of projects across the country.
It has invested about £1.5billion since the first lockdown in March last year, creating about 30,000 jobs.
L&G has allocated funding to a site in Cardiff with an office for 2,000 of its own staff, 318 ‘build to rent’ homes and a bus station, as part of the company’s £450million regeneration of Cardiff Central Square.
Other cities allocated funding from L&G include Glasgow, Birmingham, Bristol, Sheffield and Edinburgh.
Wilson added: ‘There’s a huge amount of evidence that what we’re building will make a difference, but it’s still not at the scale that we have ambition for.’