For all the pre-briefing about mega-funds, the Chancellor’s Mansion House speech seems to have fallen flat and the news this morning is about Andrew Bailey’s attack on Brexit rather than the revival of British Economic Growth.

The technical adjustments to the delivery of investments through the Local Government and workplace pension schemes is of interest to vested parties but of little interest to the person on the Clapham Omnibus.

The Government seem to have abandoned previous attempts to consolidate the pensions industry via the Value For Money framework, focussing instead on increasing private investment.and reforming the economy by direct intervention in the way pension funds organise themselves.

In the Spring, we will publish the first ever Financial Services Growth and Competitiveness Strategy.

Growth will come from

Fintech…

… sustainable finance…

… asset management and wholesale services…

… insurance and reinsurance…

… and capital markets.

Reeves goes on to outline the source of investment in growth, doffing her cap to the possibility of some investment from insurers through the relaxation of Solvency II rules in a post Brexit world (pace Bailey) she cut to the chase

Our pensions market is one of the largest in the world.There will be £800bn of assets in workplace Defined Contribution schemes and £500bn of assets in the local government pension scheme by the end of this decade.

Pension funds will always play an important role in the gilt market but for too long, pensions capital has not been used to support the development of British start-ups, scale-ups or to meet our infrastructure needs.

I have long been of the view that this hurts our economy because our highest-potential businesses cannot expand and savers are not seeing the returns on their investment which they deserve.

The Interim report of the Pension Review is now published which makes two promises

We will deliver a significant consolidation of the Defined Contribution market

We will legislate on measures to consolidate the Local Government Pension Scheme…

There is little detail, Aegon and NatWest Cushon, who both have sub-scale master trusts (where scale is defined as £25bn in assets) are mentioned as cornerstone investors in a Pathfinder British Growth Partnership . Other initiatives such as the National Wealth Fund and NISTA are touched on but there is very little detail in the Mansion House speech to match the earlier Compact

No mention of the Pensions Regulator

In one of her catchier soundbites Reeves stated

the UK has been regulating for risk, but not regulating for growth

A number of Government regulators were mentioned as part of an initiative to change things. The Pensions Regulator was not one of them.

Despite the larger of the two areas for consolidation falling under TPR’s remit, it seems to be being ignored as an agent for growth, at least in this “landmark” speech.

This should not come as relief to those in Brighton , but as a matte of disappointment.  In the speech a number or words were missing and these include any mention of innovation.

A damp squib of a speech

The pension reform promised amounts to a creation of efficiency, not a change in mindset. Toby Nangle , who clearly is being on message here, can do little more than clap politely from the sidelines

The Chancellor clearly wanted to deliver something of an antidote to the venom contained in the budget, our higher payroll bills would be getting us higher growth and a long-term fix for the economy.

But she has failed to do more than reinforce the intent of the previous Government and we will have to wait another few months for the publication of full investment report and time again till we see any firm indication of what “delivery” will mean on these promises.

It is good that detailed consultations on LGPS and Master Trust consolidation are launched and I will cover these separately. It is good that the Government is considering how to promote value over cost, that too is important.

But this speech of the Chancellor’s was low-octane stuff. “Mega-funds” is a fun catch-phrase but it will not catch the popular imagination in the way that Super has until people feel that workplace pensions form a meaningful part of their pension. Right now people are confused by freedoms to spend pots and the absence of pensions, confused by having multiple pots , confused by having lost pots and no means to find them and most of all confused as to whether the pension system is going to deliver them a decent or even adequate pension in later life.

To these needs, the Mansion House speech says nothing. Pensions are not just a means of reflating the economy, they are the means by which we pay ourselves for a third of our lives. The Chancellor should come down off her step-ladder of abstraction and explain what she is up to in a way that ordinary people can understand.