Radical new pension rules from Rachel Reeves branded 'grave mistake'

Rachel Reeves is planning a major pension system overhaul- but analysts have warned the proposal is a 'grave mistake'. The new Labour Party government Chancellor is set to unveil a pensions shake-up today (Thursday November 14) it has been warned.

The Chancellor will unveil the plans in her inaugural Mansion House speech to city leaders today, marking what the Government calls the "biggest pension reforms in decades". Felicia Hjertman, the founder and CEO of investment platform TILLIT, warned that mandating pension investments through a National Wealth Fund would be "a grave mistake".

Reforms could "unlock £80 billion" of investment, according to Treasury plans, which say fewer but larger funds can get greater returns. She said it marks "the biggest set of reforms to the pensions market in decades" ahead of providing more details in a speech at Mansion House on Thursday evening.

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Deputy Prime Minister Angela Rayner shared: "We've all seen the fantastic work carried out day in, day out, by our frontline workers and it's about time their pension started working just as hard by driving investment in their communities."

Pensions minister Emma Reynolds told Sky News larger pension schemes are able to invest "in a more diverse range of assets, including private equity, which are higher risk, but over time give a higher return". She said the government will not tell pension fund managers they must invest more in private equity but due to the larger scale they will be able to invest in a "broader range of assets, and that's what we see in Canada and Australia".

Ms Reynolds added that a Canadian teacher or an Australian professor is currently more likely to be invested in British infrastructure or British high-growth companies than a British saver, which she said is "wrong". The chancellor has said the changes would "unlock tens of billions of pounds of investment in business and infrastructure, boost people's savings in retirement and drive economic growth so we can make every part of Britain better off".