The UK government has unveiled a new initiative aimed at attracting up to £99 billion of investment from Australian pension funds into British infrastructure, real estate and private market assets by 2035, as it seeks to deepen cross-border capital flows and support long-term economic growth, according to a report by the Financial Times.
The programme, led by the Office for Investment, will establish a dedicated “Supers Unit” designed to coordinate and streamline access for large Australian superannuation funds into UK investment opportunities.
The initiative follows a memorandum of understanding signed between UK Chancellor Rachel Reeves and Australian Treasurer Jim Chalmers during recent IMF meetings, which set out a framework for increased capital cooperation between UK pension schemes and Australian superannuation funds.
Investment Minister Lord Jason Stockwood said the programme would “pave the way for vital investment into key UK projects” and strengthen the UK’s position as a core destination for Asia-Pacific institutional capital. He is scheduled to meet investors across Australia, Malaysia and Singapore in the coming week.
Australian superannuation funds already hold approximately £41bn in UK assets, with expectations that this allocation could more than double over the next decade. Industry estimates suggest total UK and European exposure from Australian pension capital could reach £323bn by 2035, driven by portfolio diversification and long-duration infrastructure demand.
The UK government has increasingly positioned pension capital as a central pillar of its growth strategy, seeking to channel both domestic and international institutional funds into private markets, including infrastructure, real estate and private credit strategies.
Recent policy efforts include the 2025 Mansion House Accord, under which major UK defined contribution pension providers committed to allocating at least 10% of default funds into private markets by 2030, with a portion earmarked specifically for UK investments.
The move also builds on broader legislative reforms, including the Pensions Schemes Act, which expands ministerial powers to influence pension fund allocations into domestic private assets and corporate investment.
Alongside international inflows, UK institutional investors are also increasing exposure to private credit. For example, National Employment Savings Trust recently committed £450m to private credit investments targeting US borrowers through specialist manager Crescent Capital.
Officials argue that attracting large-scale Australian pension capital will support funding for long-term UK projects across energy transition, transport, housing and digital infrastructure, while reinforcing bilateral trade and investment ties between the two economies.
Singapore and other Asia-Pacific jurisdictions are also expected to remain important sources of institutional capital, with Singaporean foreign direct investment in the UK estimated at around £27bn as of 2024.
