The government’s Levelling Up white paper designed to refocus government spending – and investment from large institutional investors like local authority pension funds – on tackling place-based inequalities, has been welcomed by the Impact Investing Institute.
The institute’s chief executive, Sarah Gordon, said there was an urgent need for investment to address regional inequalities in order to improve the lives of local people, and that place-based impact investing will be critical to achieving the aims of the white paper.
“The leveraging of private capital across policy areas and sectors will be an essential part of achieving these ambitions and we hope that government will play a decisive role in facilitating this,” Gordon continued.
“They can do so by using public investment to catalyse institutional investment in historically underserved regions of the UK and supporting local authorities to engage with institutional capital.”
Gordon particularly welcomed the white paper’s announcement of a 5% target for local investment by council pension schemes, as it was a recommendation made by the institute in its own white paper, produced with The Good Economy and Pensions for Purpose in 2021.
“This will make it easier for pension schemes to consider the real opportunities presented by investing for impact in UK towns, cities and regions,” added Gordon.
“By putting their investments to work to address local challenges, pension schemes can achieve appropriate risk adjusted financial returns that are compatible with their fiduciary duty while enhancing local resilience and improving people’s lives.”
Gordon continued “Through our place-based impact investing approach, and the extensive work we have done on pensions with impact, the Impact Investing Institute stands ready to support both the government and individual pension schemes to ensure this target is met and real positive impact is delivered.”