London Daily

Focus on the big picture.
Monday, Jun 29, 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
UK Launches New Measures to Improve Safety Standards in Night-Time Venues
UK Tightens Import Rules for Low-Value Parcels to Support Domestic Retailers
UK Launches £85 Million Obesity Care Programme Targeting Early Intervention Projects
UK Commits Up to $26 Million to Ebola Response in Democratic Republic of Congo
Security Industry Authority Flags Safety Failures in Night-Time Economy Inspections
Cambridge South Railway Station Opens After £250 Million Investment
UK Moves to Close Import Duty Loophole for Small Parcels by 2028
UK Invests £85 Million in Projects to Transform Obesity Care
Berkeley Group Warns London Housebuilding Falling Far Short of Demand
UK Council Tax Arrears Rise to £9.3 Billion Amid Ongoing Household Financial Strain
Markets Watch Political Transition as Andy Burnham Emerges as Labour Leadership Frontrunner
Extreme Heat Raises Long-Term Risks for UK Inflation and Productivity, Analysts Warn
UK Health Alerts Extended as Record June Heatwave Grips England
UK Parliament Faces High-Stakes Week of Spending, Security and Industrial Legislation
UK Repeals Vagrancy Act Ending Criminalisation of Rough Sleeping in England and Wales
GB News Pundit Charged With Fraud Over Alleged Conduct as Former Labour Adviser
Reform UK Gains Parliamentary Visibility in First Senedd Opposition Appearance
Metropolitan Police Arrest Man on Suspicion of Attempted Murder After London Car Incident
Ocado Chief Executive Tim Steiner Faces Scrutiny Over £100 Million Remuneration Package
British Chambers of Commerce Downgrades UK Growth Outlook to 0.9 Percent for 2026
Nottingham University Hospitals Maternity Failings Trigger Renewed Calls for Public Inquiry
Severe Heatwave Disrupts UK Transport Networks and Strains Public Services Across England
Labour Leadership Transition Raises Prospect of Andy Burnham Becoming UK Prime Minister
UK Government Confirms Further Medicine Price Concessions for Community Pharmacies in June
British Chambers of Commerce Calls for Public Procurement Reform to Boost Regional Growth
Thousands Mark Armed Forces Day Across the United Kingdom With National Parades and Flypasts
Man Arrested in Ealing on Suspicion of Attempted Murder After Vehicle Ramming Incident Injures Five
Cambridge South Station Opens With £250 Million Investment to Strengthen Life Sciences Corridor
UK Heat-Health Alerts Extended Across England as High Temperatures Persist
Thames Water and Energy Operators Warn of Peak Demand Risks During UK Heatwave
Government Conference Highlights Push for Evidence-Led Policy Across UK Public Sector
Insolvency Service Reports Improved Confidence in UK Insolvency System
Security Industry Authority Finds Widespread Safety Failures in UK Night-Time Economy
Nigel Farage Expands Anti-WHO Campaign Into United States With New Lobbying Structure
Home Secretary Seema Mahmood Unveils New Safe Routes Plan for Asylum Seekers
UK Government Warns of Peak Electricity and Water Pressure Amid Ongoing Heatwave
New Nuclear Plant in Wales Named Gwyndod Power Station as Energy Strategy Advances
UK Announces First Major Hydropower Projects in Four Decades to Expand Renewable Capacity
Thirteen Men Charged in Major UK Sexual Abuse Case as Investigation Continues
UK Launches Cross-Sector Climate Security Taskforce Linking Environment and National Security
UN Secretary-General António Guterres Calls for Urgent Global Methane Emissions Cuts in London
World Bank Approves $1 Billion UK-Backed Financing Package for Ukraine Recovery
UK Pledges Emergency Aid and Rescue Team Deployment to Earthquake-Hit Venezuela
Bank of England Holds Interest Rates at 3.75 Percent for Fourth Straight Meeting
Record-Breaking Heatwave Puts Strain on UK Health Services and Energy Networks
London Ambulance Service Sees Record Emergency Demand as Heatwave Intensifies
British Chambers of Commerce Warns of Prolonged Weak Investment Climate Through 2027
Bank of England Holds Interest Rates as Inflation Risks Persist
UK Construction Sector Faces One Percent Contraction Amid Cost and Investment Pressures
Former DUP Leader Sir Jeffrey Donaldson Convicted of Sexual Offences
×