AMP Welcomes Osborne Pensions Raid

Commenting on George Osborne’s Autumn Statement announcement today on planned infrastructure spending, AMP Capital Head of Infrastructure Europe Boe Pahari said:

“This is an excellent move by the Government, whilst not unexpected. Mobilising pension funds at a time when banks are deleveraging is a solid alternative for creative economic stimulus. Investing in infrastructure has a way of creating momentum in jobs, consumer and capital markets but from a secure, low leverage, base.

“Having said that, whilst pension funds may look at unlevered options, it is worthwhile adding low levels of leverage that create capital efficiencies without detracting from the low risk investment profile. We must remember the real risk in these investments predominantly lie in the operations, irrespective of leverage. However with solid management and sector expertise, these investments can be well managed.”