On January 28, British Prime Minister Keir Starmer and Finance Minister Rachel Reeves will meet with business leaders in London to unveil reforms in the pension sector aimed at stimulating economic growth and investment.
The meeting is set to take place in London's financial district with prominent CEOs such as Charlie Nunn from Lloyds Banking Group, Allison Kirkby from BT, Ken Murphy from Tesco, and Charles Woodburn from BAE Systems in attendance, as announced by the government.
Starmer remarked in a preliminary statement, "To achieve the change our country needs requires nothing short of rewiring the economy. It needs creative reform, the removal of hurdles, and unrelenting focus."
The announcement precedes a significant speech by Reeves scheduled for Wednesday, where she will outline her strategy to revitalize the UK's sluggish economy.
Reeves and Starmer vowed before the last July election to position Britain as the fastest-growing Group of Seven economy. However, since taking office, the economy has faced challenges, with many employers criticizing Reeves' initial budget proposal, which included increased business taxes.
The proposed reform aims to enable the release and reinvestment of corporate pension surpluses exceeding 100 billion pounds ($124 billion) back into companies or for the enhancement of employee benefits, rather than being retained in low-return assets like government bonds.
According to Downing Street, around 75% of corporate defined-benefit pension schemes, amounting to 160 billion pounds, are in surplus, yet current restrictions have hindered businesses from utilizing these funds for investment.
A report by the Pensions and Lifetime Savings Association last year generally advocated for surplus sharing but noted that surpluses could fluctuate based on market conditions.