Expert says property investment could benefit private pensions

An independent financial adviser has suggested that bricks and mortar could be an ideal way to plug a deficit in private sector pensions.

Dr Ros Altmann, an expert on benefits, pay and reward, commented that the Pensions Regulator has welcomed the idea of using "contingent assets" in company schemes to make up the shortfall in cash.

Furthermore, it appears that supermarket chain Sainsbury’s is to operate a bricks and mortar policy as it signalled its intention to bridge the gap in its private fund, estimated to be around £1.27 billion, with investment in property portfolios.

Its plan is said to be able to address around £600 million of its own deficit.

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However, with regards to possible government help for private sector pensions, Dr Altmann hinted that it is a "huge problem and one nobody has a good answer to".

She added that in the future the quest to solve these problems for UK organisations will involve "assigning as much as possible to the scheme" without putting a business’s long-term prospects in danger.