Until yesterday, I had been told, as had all FT readers, that our new Sizewell C energy project would be externally financed chiefly by Brookfield – a Canadian investment manager. My thoughts on reading this was that if I want long term management, I want it within a pension scheme, or at least within a British investment company.
Ministers are preparing to reduce the UK government’s stake in Sizewell C by more than expected, after a last-minute move to change the roster of private investors in the multibillion-pound nuclear project.
Mary McDougall picks up the story as a pension lesson
But the government in recent days moved to drop Brookfield in favour of selling a larger stake to a combination of Canadian pension fund La Caisse and London-based investment manager Amber Infrastructure, the people said.
The sums involved are staggering as the FT goes on to explain
La Caisse will now take a 20 per cent stake in Sizewell and Amber will take a 10 per cent stake, according to the people, while the stakes of Centrica and EDF are unchanged.
The increased private investor stake means the UK government will own 42.5 per cent of the project, which is set to cost £38bn, down from 47.5 per cent under previous plans. The government currently owns about 84 per cent of the project.
The project cost is huge and it requires an investment that Ed Miliband does not want the tax-payer to take directly
The increased private investor stake means the UK government will own 42.5 per cent of the project, which is set to cost £38bn, down from 47.5 per cent under previous plans. The government currently owns about 84 per cent of the project.
La Caisse, a huge Canadian fund is not messing about
Charles Emond, chief executive of La Caisse, which manages C$473bn (£254bn) on behalf of 6mn pension savers, told the Financial Times in May that it planned to invest more than £8bn in the UK over the next five years.
“We’d like to be a partner of trust and choice in the UK,” said Emond. The government’s plans to increase infrastructure spending were “a huge opportunity and we’d like to be there in the early stages to see if we can do something”, he added.
While I am happier to see investment in Sizewell reverting to the UK (Amber) and more moving to pension funds (La Caisse), I wonder if large UK pensions could not have done better. La Caisse is only just over half the size of LGPS, where was LGPS? The answer is LGPS is split into pools and further into funds. LGPS was not it seemed – involved.
We do need to get better organised and better motivated. I would like British CEOs and CIOs sound as determined as Charles Edmond. Good job Charles. Good job Ed Miliband reducing UK debt and diversifying investment into Sizewell C. It is about time we sorted power out in the UK, I wish luck to all power sources and interconnectors and hope we see Britain in good shape – with the help of UK pension schemes.
