Key Takeaways
- • The introduction of asset pooling has given UK Local Government Pension Scheme (LGPS) funds access to the largest private markets impact funds, according to PEI Private Equity.
- • Place-based commitments are expected to increase LGPS allocations to smaller impact funds, alongside larger fund commitments.
- • LGPS assets total approximately £400 billion, making the scheme a significant force in UK private markets impact investing.
- • Government pension reforms are reshaping how the LGPS directs capital toward local and regional investment.
Summary
UK Local Government Pension Schemes have emerged as major impact investors in private markets, according to PEI Private Equity. The central driver cited in the coverage is the introduction of asset pooling. Pooling has given LGPS funds access to the largest private markets impact funds, while place-based commitments mean allocations to smaller funds are also set to increase.
The growth of LGPS activity in private markets impact investing is linked in related PEI coverage to the work of the LGPS investment pools. The government first set out criteria for pooling assets in November 2015, inviting proposals for collective investment vehicles to achieve economies of scale. The LGPS is a substantial part of the UK pension system, with assets reported at roughly £400 billion, and scale is central to its ability to commit capital across both large and smaller funds.
Place-based impact investing is a recurring theme. Local government pension funds have a longstanding interest in local investing, and related analysis notes that if 5% of LGPS funds were allocated locally, this would unlock significant capital for regional development. Commentary links LGPS impact activity to the broader UK 'levelling up' agenda, as the government seeks to address decades of underinvestment and entrenched regional inequality.
The full PEI article is behind a registration wall, so the detailed allocation figures and fund-level data it contains could not be verified in this summary.
The growth of LGPS activity in private markets impact investing is linked in related PEI coverage to the work of the LGPS investment pools. The government first set out criteria for pooling assets in November 2015, inviting proposals for collective investment vehicles to achieve economies of scale. The LGPS is a substantial part of the UK pension system, with assets reported at roughly £400 billion, and scale is central to its ability to commit capital across both large and smaller funds.
Place-based impact investing is a recurring theme. Local government pension funds have a longstanding interest in local investing, and related analysis notes that if 5% of LGPS funds were allocated locally, this would unlock significant capital for regional development. Commentary links LGPS impact activity to the broader UK 'levelling up' agenda, as the government seeks to address decades of underinvestment and entrenched regional inequality.
The full PEI article is behind a registration wall, so the detailed allocation figures and fund-level data it contains could not be verified in this summary.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.