Blackrock Inc, one of the largest fund managers in the UK, has warned Chancellor Jeremy Hunt that forcing institutions to invest in UK stocks will make pensioners worse off.
Hunt has asked some pension providers to disclose how much they invest in UK equities, raising questions over whether he might mandate a minimum amount of British stocks to be held in portfolios.
Antony Manchester, BlackRock’s head of UK public policy, told an event hosted by think tank Bright Blue: “We look after the pensions of about 12 million people here in the UK and we strongly believe that they are there to give people a decent retirement.
"We are a little bit worried about suggestions that they might be forced to invest in assets that their managers don’t think are going to give the best returns for the end investor.”
City minister Bim Afolami responded: “I am not talking about forcing anybody to do anything. Transparency will be quite an important lever, that’s what we’re talking about.
“We are not going to mandate anybody to do anything.”
Jeremy Hunt recently introduced a £5,000 increase in the ISA allowance that has to be invested in British stocks in a move designed to boost retail interest in UK equities.