Key Takeaways
- • Only 2 legally binding venture capital commitments have been secured by UK DC pension default funds aligned with the Mansion House Compact as of May 2026, despite the initiative launching in 2023 with 11 major pension provider signatories.
- • 76% of the 83 VC and growth equity firms surveyed by UK Private Capital reported inability to engage meaningfully with DC pension providers, signaling a significant implementation gap between policy ambition and market execution.
- • Pessimism among VC firms has intensified: 48% now express doubt the Mansion House agreements will deliver increased private markets investment by 2030, compared to only 20% who remain optimistic—a substantial shift in sentiment.
- • The Mansion House Compact (2023) targeted 5% allocation of DC default funds to unlisted equities by 2030; the subsequent Mansion House Accord (2025) escalated commitments to 10% allocation across 17 schemes, with 5% earmarked for UK investments—yet real-world capital deployment remains minimal.
- • 73% of respondents called for greater government facilitation of pension-to-private-capital investment flows, indicating structural and regulatory barriers are impeding capital allocation despite formal commitments from pension fund signatories.
Summary
Progress toward channeling defined contribution pension capital into UK venture capital and unlisted equities remains critically stalled, according to research conducted by UK Private Capital in April and May 2026. Despite ambitious commitments made through the Mansion House Compact (2023) and Mansion House Accord (2025), only two legally binding venture capital commitments have materialized from DC pension default funds aligned with these initiatives. An additional six VC firms report currently active negotiations with Mansion House signatories, but this limited pipeline underscores a substantial execution gap between policy targets and market reality.
The research, which surveyed 83 venture capital and growth equity firms, reveals severe friction in pension fund engagement. Three-quarters of respondents (76%) reported they have not been able to engage meaningfully with DC pension providers, while 73% stated the government must do more to facilitate private capital investment. These findings suggest that institutional, regulatory, and operational barriers remain substantial obstacles to capital deployment, despite formal pension fund commitments to the reform agenda.
Sentiment among VC firms has deteriorated markedly. In May 2026, 48% of respondents expressed pessimism that the Mansion House agreements would deliver material increases in private markets investment by 2030, compared to only 20% who maintained optimism. This shift reflects growing concerns about whether the voluntary industry-led framework will achieve its stated objectives. The Mansion House Compact originally committed 11 major UK pension providers to allocate at least 5% of DC default funds to unlisted equities by 2030. The subsequent Mansion House Accord, published in May 2025, broadened ambitions when 17 DC schemes committed to 10% allocation in private markets by 2030, with 5% specifically allocated to UK investments.
The gap between commitment and capital deployment points to deeper structural challenges. Despite regulatory alignment and high-profile pension fund pledges, the practical mechanisms for channeling pension savings into VC and growth equity investments appear underdeveloped. VC firms cite insufficient government support for facilitating these investment flows, suggesting that policy coordination between the Treasury, Financial Conduct Authority, and the pension industry requires substantive strengthening to unlock the targeted capital volumes by 2030.
The research, which surveyed 83 venture capital and growth equity firms, reveals severe friction in pension fund engagement. Three-quarters of respondents (76%) reported they have not been able to engage meaningfully with DC pension providers, while 73% stated the government must do more to facilitate private capital investment. These findings suggest that institutional, regulatory, and operational barriers remain substantial obstacles to capital deployment, despite formal pension fund commitments to the reform agenda.
Sentiment among VC firms has deteriorated markedly. In May 2026, 48% of respondents expressed pessimism that the Mansion House agreements would deliver material increases in private markets investment by 2030, compared to only 20% who maintained optimism. This shift reflects growing concerns about whether the voluntary industry-led framework will achieve its stated objectives. The Mansion House Compact originally committed 11 major UK pension providers to allocate at least 5% of DC default funds to unlisted equities by 2030. The subsequent Mansion House Accord, published in May 2025, broadened ambitions when 17 DC schemes committed to 10% allocation in private markets by 2030, with 5% specifically allocated to UK investments.
The gap between commitment and capital deployment points to deeper structural challenges. Despite regulatory alignment and high-profile pension fund pledges, the practical mechanisms for channeling pension savings into VC and growth equity investments appear underdeveloped. VC firms cite insufficient government support for facilitating these investment flows, suggesting that policy coordination between the Treasury, Financial Conduct Authority, and the pension industry requires substantive strengthening to unlock the targeted capital volumes by 2030.
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