London Daily

Focus on the big picture.
Tuesday, Oct 27, 2026

Lawmakers call for Bank of England role in pensions after LDI debacle

Lawmakers call for Bank of England role in pensions after LDI debacle

The Bank of England should help oversee pension schemes, with powers to order other regulators to take action, a committee of lawmakers from Britain's parliament said on Tuesday.
The House of Lords' industry and regulators committee said watchdogs in the liability-driven investment (LDI) sector appear to have been "too slow" to recognise risks, and made a recommendations to UK financial services minister Andrew Griffith on Tuesday.

LDI funds have been used by pension schemes to ensure they can meet payouts to pensioners in the future.

Turmoil in the British government bond market in September triggered by former Prime Minister Liz Truss's radical tax cut plans caused problems for these funds whose oversight is complex.

Pension schemes which appoint LDI funds are managed by The Pensions Regulator, while LDI managers are regulated by the Financial Conduct Authority. The funds are listed in Luxembourg and Dublin according to European Union rules.

The government should consider giving the BoE's Prudential Regulation Authority a role in overseeing pension schemes, the committee said. The BoE's Financial Policy Committee should have powers to direct action by regulators in the pensions sector if they are too slow, it added.

Accounting rules should be reviewed to see if they can take a longer term view of pension investments, the committee said.

EU rules do not permit the use of derivatives in LDI funds, but Britain, now outside the bloc, has applied them in a "permissive" way.

"The government should review whether the use of leverage and derivatives by pension schemes should be more tightly controlled in the future," the committee said.

It backed calls from the FCA that investment consultants, who advise pension scheme trustees on using LDI funds, should be regulated as a "matter of urgency".

The BoE is due next month to set out a framework to improve the resilience of LDI funds.

Ed Wilson, a partner at consultants Isio, said he worried that the backlash against LDI would go too far when it was still a valuable tool for many plans. "LDI in many ways has self-regulated already," Wilson said.
Newsletter

Related Articles

0:00
0:00
Close
Education or Indoctrination? The Growing Debate Over Religious Participation in British Schools
Germany's Vanishing Shopfronts: The Silent Collapse of the Businesses That Built Its Cities
Northern Ireland Executive Reaches Agreement on Public Transport Modernization and Cross-Border Rail Infrastructure Funding
Department for Energy Security and Net Zero Approves New North Sea Carbon Capture and Storage Industrial Clusters
Office for National Statistics Reports Stabilization in Private Rental Growth Across Major English and Welsh Regional Cities
United Kingdom Automotive Manufacturing Output Rises Moderately as Electric Vehicle Assembly Lines Expand in the Midlands
Competition and Markets Authority Launches Formal Inquiry Into Cloud Computing Infrastructure and Artificial Intelligence Partnerships
Scottish Government Finalizes Emergency Budget Adjustments Following Multi-Year Public Sector Funding Shortfalls
National Health Service England Announces Major Emergency Care Overhaul to Alleviate Severe Winter Capacity Pressures
Chancellor Rachel Reeves Prepares Autumn Budget Amid Intensifying Scrutiny Over Public Spending and Fiscal Rules
Bank of England Signals Cautious Approach to Further Interest Rate Cuts as Persistent Wage Growth and Inflation Pressures Remain
Transport for London Unveils Expanded Zero-Emission Bus Fleet to Meet Capital Air Quality Targets
Higher Education Institutions Face Deepening Financial Strain Amid Declining International Student Enrolment
Automotive Industry Leaders Criticize Government Tax Policies and Urge Action on Retail Consumer Confidence
Environment Agency Issues Flood Alerts Across Scottish and English Waterways Following Heavy Rainfall
Independent Audit Highlights Persistent Security Vulnerabilities Across Legacy Government Digital Portals
Northern Ireland Political Leaders Clash Over Westminster Funding Allocations Ahead of Autumn Budget
Ethnic Minorities in England Face Significant Disparities in Routine Breast Cancer Diagnosis Rates
National Police Chiefs Report Alarming Surge in Domestic Abuse Cases Fuelled by Expanding Illegal Cocaine Market
Government Announces Two Hundred and Twenty Million Pound Pothole Funding Boost for Local Highway Authorities
China Issues Formal Warning Over Potential United Kingdom Restrictions on Chinese Electric Vehicles
British Defence Ministers Sign E5 Pact to Enhance European Military Capabilities and Industrial Cooperation Within NATO
United Kingdom Business Activity Expands at Fastest Pace in Eight Months According to S&P Global Flash Survey
Chancellor John Healey Prepares Major Devolution Package and Bank Profit Surcharge Ahead of Upcoming Autumn Budget
National Health Service Consultants in England Announce Two-Day Strike Action Scheduled for November
Major Clean-Up Under Way Across Britain Following Destruction Caused by Consecutive Storms Austen and Boelo
KEY TRENDS TO WATCH
Declassified Intelligence Files Reveal British Security Services Monitored National Health Service Founder
British Government Launches Sweeping Regulatory Crackdown on High-Risk Cosmetic Procedures
Scottish National Party Demands Ban on Using Scottish Revenues to Fund English Nuclear Energy Projects
Mayor of London Initiates Landmark Pedestrianisation of Oxford Street to Revitalise Global Retail Hub
British Judges Granted Expanded Legal Powers to Punish Convicted Killers Who Refuse to Attend Sentencing
United Kingdom Poised to Miss Reduced International Aid Spending Targets Ahead of Fiscal Review
Surging Cocaine Consumption Drives Record Drug Fatalities and Rising Crime Rates Across Britain
Department of Health and Social Care Announces One Hundred and Forty Million Pound Boost for Urgent Care
British Services Sector Records Strongest Growth in Eight Months Despite Broader Economic Uncertainty
United Kingdom Retail Sales Suffer Unexpected Decline as Consumer Confidence Plummets
Greater Manchester Mayor Andy Burnham Urges National Debate on Restoring European Union Free Movement
Deep Cabinet Divisions Emerge Over Controversial Approval of North Sea Fossil Fuel Projects
United Kingdom Government Urges Citizens to Stockpile Essential Supplies in National Resilience Pivot
Storm Boelo Kills Two People and Cuts Power to Tens of Thousands Across Great Britain
Critical Software Flaw Forces Dozens of United Kingdom Government Services Offline Amid Mass Security Warnings
UK Consumer Confidence Tumbles Amid Rising Energy Costs and Global Commodity Price Pressures
North Sea Transition Authority Approves Production from Jackdaw Gas Field to Bolster Domestic Energy Security
Storm Boelo Leaves Tens of Thousands of Households Without Power Across Scotland and Northern Ireland
UK Government Launches National Be Ready Campaign Urging Households to Prepare Three Days of Emergency Supplies
Department for Environment Food and Rural Affairs Implements Stricter Water Quality Regulations for British Rivers
Welsh Government Launches Major Renewable Energy Initiative to Expand Offshore Wind Capacity Along the Coast
Northern Ireland Executive Reaches Final Agreement on Comprehensive Regional Infrastructure Modernization Plan
Office for National Statistics Reports Moderate Increase in British Retail Sales Driven by Autumn Discounts
×