UK Pension Schemes Bill expected to drive greater consolidation of pension schemes into fewer, larger entities.
Larger scale improves ability to allocate capital into private markets including private equity, infrastructure and private credit.
Stronger governance and investment frameworks expected to enhance decision-making and reduce barriers to alternative assets.
Private markets expected to see increased institutional participation from UK pension funds over time, strengthening long-term demand and validation of the asset class.
The Bill also includes reserve powers allowing the government, under specific conditions, to influence how default workplace pension schemes invest. Some investors may prefer to retain direct control.
Individual investors can already access private markets through the Wealth Club Private Markets SIPP, launched earlier this year.
 Alex Davies, Founder and CEO of Wealth Club

“The Pension Schemes Bill represents a meaningful structural shift in UK retirement investing. By driving consolidation and increasing scale, it will significantly enhance the ability of pension schemes to invest in private markets, which have historically been constrained by fragmentation, governance complexity and liquidity considerations.

Stronger governance frameworks and more sophisticated investment processes will make it easier for pension schemes to allocate to private equity, infrastructure and private credit as part of a broader total portfolio approach. As it creates conditions to make private markets investments more feasible, via scale and governance reform, the Bill will bring private markets more into the mainstream institutional asset class.

But importantly, experienced investors do not need to wait for this shift to fully play out. Through the Wealth Club private markets SIPP, UK individuals can already access many of the same world-class managers and strategies that are typically available to large institutional investors today.

We see this as a pivotal moment, as private markets are moving from an institutional-only allocation to something that is increasingly relevant for sophisticated individual investors today.

The Bill also includes a reserve power allowing the government, under specific conditions, to influence how default workplace pension schemes invest in certain asset classes. This power may prompt some investors to think more carefully about how much control they have over their pension investments and whether alternative arrangements that offer greater discretion are more appropriate for them.

Opportunities in private markets

Private markets offer investors exposure to a broad and growing set of opportunities that are increasingly difficult to access through public markets alone. These include:

Private equity: access to high-growth companies not listed on public exchanges, including firms such as SpaceX and other category-defining businesses
Venture capital: early-stage innovation across technology, healthcare and disruptive sectors
Private infrastructure: exposure to long-term, asset-backed investments including data centres, energy transition assets and transport infrastructure, often with inflation-linked characteristics
Private credit: lending to companies outside traditional banking markets, often with attractive yield profiles
Secondaries: exposure to existing private equity portfolios, offering earlier cashflow potential and diversification benefits
Over the past 25 years, private equity has delivered significant outperformance versus public markets, with data from Hamilton Lane showing average annual returns outperforming global equities by approximately 6.2% net of fees.

At the same time, the opportunity set is expanding as more companies remain private for longer, while public markets become increasingly concentrated, with a small number of listed stocks driving a disproportionate share of returns.

While private markets can offer diversification and access to differentiated return streams, they are long-term and illiquid investments and should be considered as part of a broader portfolio strategy.’’