UK Faces £150B Investment Gap as City Urges Pension Reforms and Private Capital Mobilization

The UK confronts a staggering £150 billion funding shortfall across SMEs and critical infrastructure projects, from housing to digital networks. City policymakers warn that inaction risks crippling productivity and economic growth at a time when the nation struggles to escape stagnation.

Chris Hayward, Policy Chairman for the City of London, frames the challenge starkly: "The cost of doing nothing WOULD be measured in lost opportunities and prolonged economic sluggishness." The urgency comes as global market volatility and anticipated tax hikes constrain traditional fiscal solutions.

Pension fund reforms emerge as a central remedy, with the City pointing to successful models in Canada and Australia where domestic retirement capital fuels infrastructure. While the Mansion House Accord has secured commitments from major pension funds to allocate 10% to private markets—potentially unlocking £50 billion—officials demand more aggressive action.