How we invest

The Scheme’s main objective is to ensure there are sufficient assets to pay the right benefits at the right time to members and their beneficiaries under the Rules of the Scheme.

As more of the Scheme’s members reach retirement, the matching of assets and liabilities will be increased with the investment portfolio transitioning towards bond and bond-like investments. By 2034 we intend for our assets to provide adequate income plus capital repayments to meet members’ benefit payments as they fall due.

 

Investment grade credit

The Scheme owns approximately £9.8bn of corporate bonds which form part of our cash flow matching portfolio.

On June 2024 approximately 65% of the Scheme’s exposure to investment grade corporate bonds was allocated to UK corporate bonds and the remaining 35% was invested globally.

Government bonds & cash

The Scheme owns, and Brightwell manages approximately £7.9bn of conventional and index-linked government bonds to hedge part of its inflation and interest rate risk.

Property

Around 8% or £2.8bn of Scheme assets are invested in property, comprising of a diversified mix of offices, industrial property, retail and residential assets.

The Scheme has had success in developing a number of mixed use city centre “estates”.

King’s Cross is the largest and highest profile of these and is emblematic of the strategy: creating attractive places where work, leisure and education, across a range of sectors co-locate in a vibrant public realm. Sustainability in its broadest sense is at the core of our approach and involves having low environmental impact, job creation and partnerships with local councils.

Infrastructure

The Scheme has been investing in UK infrastructure since 2011. Current investments are valued at approximately £1.1bn. Some examples are below:

Sustainable investment

Read about our approach to sustainable investment and our goal to achieve net zero greenhouse gas emissions across our investment portfolio by 2035.

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