She said it marks “the biggest set of reforms to the pensions market in decades” ahead of providing more details in a speech at Mansion House on Thursday evening.
Almost 90 local government pension pots will be grouped together, with defined contribution schemes merged and assets pooled together.
This is part of the government’s plan to increase economic growth through investing in infrastructure.
Pension schemes get greater returns when they reach around £20bn to £50bn as they are “better placed to invest in a wider range of assets”, according to the government.
This is backed up by evidence from Canada and Australia, the government argues – with Canada’s schemes investing four times more in infrastructure, and Australia three times more than the UK’s defined contribution schemes.
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Pensions minister Emma Reynolds told Sky News larger pension schemes are able to invest “in a more diverse range of assets, including private equity, which are higher risk, but over time give a higher return”.
She said the government will not tell pension fund managers they must invest more in private equity but due to the larger scale they will be able to invest in a “broader range of assets, and that’s what we see in Canada and Australia”.
Ms Reynolds added that a Canadian teacher or an Australian professor is currently more likely to be invested in British infrastructure or British high-growth companies than a British saver, which she said is “wrong”.
The chancellor has said the changes would “unlock tens of billions of pounds of investment in business and infrastructure, boost people’s savings in retirement and drive economic growth so we can make every part of Britain better off”.
However, Tom Selby, the director of public policy at financial company AJ Bell, said: “There needs to be some caution in this push to use other people’s money to drive economic growth. It needs to be made very clear to members what is happening with their money.”
The government says the funds will be regulated by the Financial Conduct Authority and will need to “meet rigorous standards to ensure they deliver for savers”.
The Local Government Pension Scheme in England and Wales will manage assets worth around £500bn by 2030.
These assets are currently split across 86 different administering authorities, with local government officials and councillors managing each fund.
Under the government plans, the management of local government pensions and what they invest in will be moved from councillors and local officials to “professional fund managers”.
This will allow them to invest more in assets such as infrastructure, supporting economic growth and local investment on behalf of the 6.7 million public servants, the government said.
Defined contribution pension schemes are set to manage £800bn worth of assets by the end of the decade.
There are around 60 different multi-employer schemes, each investing savers’ money into one or more funds. The government will consult on setting a minimum size requirement for these funds.
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Businesses cautious – but pensions sector backs plans
Businesses will need to be reassured that the government’s plans are watertight following the fallout from the budget, according to the trade group the Confederation of British Industry (CBI).
The CBI’s chief economist Louise Hellem said: “While the chancellor is right to concentrate on mobilising investment, putting pension reform to work for the government’s growth mission, unlocking investment also needs competitive and profitable businesses.
“With the budget piling additional costs on firms and squeezing their headroom to invest, the government needs to work hard to regain the confidence in the UK as a place businesses and communities can succeed.
“Pension schemes will want to operate within a UK economy that is prospering.”
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But key parts of the pensions sector gave their backing to the government’s plans, including Standard Life, Royal London, Local Pensions Partnership Investments and the Pensions and Lifetime Savings Association.
Deputy Prime Minister Angela Rayner said: “This is about harnessing the untapped potential of the pensions belonging to millions of people, and using it as a force for good in boosting our economy.”
Bosch will cut up to 5,500 jobs as it struggles with slow electric vehicle sales and competition from Chinese imports.
It is the latest blow to the European car industry after Volkswagen and Ford announced thousands of job cuts in the last month.
Cheaper Chinese-made electric cars have made it trickier for European manufacturers to remain competitive while demand has weakened for the driver assistance and automated driving solutions made by Bosch.
The company said a slower-than-expected transition to electric, software-controlled vehicles was partly behind the cuts, which are being made in the car parts division.
Demand for new cars has fallen overall in Germany as the economy has slowed, with recession only narrowly avoided in recent years.
The final number of job cuts has yet to be agreed with employee representatives. Bosch said they would be carried out in a “socially responsible” way.
About half the job reductions would be at locations in Germany.
Bosch, the world’s biggest car parts supplier, has already committed to not making layoffs in Germany until 2027 for many employees, and until 2029 for a subsection of its workforce. It said this pact would remain in place.
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The job cuts would be made over approximately the next eight years.
The Gerlingen site near Stuttgart will lose some 3,500 jobs by the end of 2027, reducing the workforce developing car software, advanced driver assistance and automated driving technology.
Other losses will be at the Hildesheim site near Hanover, where 750 jobs will go by end the of 2032, and the plant in Schwaebisch Gmund, which will lose about 1,300 roles between 2027 and 2030.
Its remaining German plants are also set to be downsized.
While Germany has been hit hard by cuts, it is not bearing the brunt alone.
Earlier this week, Ford announced plans to cut 4,000 jobs across Europe – including 800 in the UK – as the industry fretted over weak electric vehicle (EV) sales that could see firms fined more for missing government targets.
Cambridge University’s wealthiest college is putting the long-term lease of London’s O2 arena up for sale.
Sky News has learnt that Trinity College has instructed property advisers to begin sounding out prospective investors about a deal.
Trinity, which ranks among Britain’s biggest landowners, acquired the site in 2009 for a reported £24m.
The O2, which shrugged off its ‘white elephant’ status in the aftermath of its disastrous debut in 2000, has since become one of the world’s leading entertainment venues.
Operated by Anschutz Entertainment Group, it has played host to a wide array of music, theatrical and sporting events over nearly a quarter of a century.
The opportunity to acquire the 999-year lease is likely to appeal to long-term income investment funds, with real estate funds saying they expected it to fetch tens of millions of pounds.
Trinity College bought the lease from Lend Lease and Quintain, the property companies which had taken control of the Millennium Dome site in 2002 for nothing.
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The college was founded by Henry VIII in 1546 and has amassed a vast property portfolio.
It was unclear on Friday why it had decided to call in advisers at this point to undertake a sale process.
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Trinity College Cambridge did not respond to two requests for comment.
Clothing stores were particularly affected, where sales fell by 3.1% over the month as October temperatures remained high, putting shoppers off winter purchases.
Retailers across the board, however, reported consumers held back on spending ahead of the budget, the ONS added.
Just a month earlier, in September, spending rose by 0.1%.
Despite the October fall, the ONS pointed out that the trend is for sales increases on a yearly and three-monthly basis and for them to be lower than before the COVID-19 pandemic.
Retail sales figures are significant as household consumption measured by the data is the largest expenditure across the UK economy.
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The data can also help track how consumers feel about their financial position and the economy more broadly.
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2:30
Business owners worried after budget
Consumer confidence could be bouncing back
Also released on Friday was news of a rise in consumer confidence in the weeks following the budget and the US election.
Market research company GfK’s long-running consumer confidence index “jumped” in November, the company said, as people intended to make Black Friday purchases.
It noted that inflation has yet to be tamed with people still feeling acute cost-of-living pressures.
It will take time for the UK’s new government to deliver on its promise of change, it added.
A quirk in the figures
Economic research firm Pantheon Macro said the dates included in the ONS’s retail sales figures could have distorted the headline figure.
The half-term break, during which spending typically increases, was excluded from the monthly statistics as the cut-off point was 26 October.
With cold weather gripping the UK this week clothing sales are likely to rise as delayed winter clothing purchases are made, Pantheon added.