Public service pensions benefit business

Strathclyde Pension Fund is launching an innovative £100million scheme to benefit small and medium size businesses in Scotland. The aim is to deliver a return for the fund, boost the economy and create jobs.

Proposals from Scottish firms will be studied by a panel of experts who will sign off loans or equity deals. The fund will target firms looking to expand and willing to pay the "living wage" of £7.20 an hour.

Fund Chair Councillor Paul Rooney said: "By making these funds available for appropriate investments, we can generate jobs. But there will have to be a return for the pension fund and for people's pensions. It's important the small firms we invest in have a clear business plan and meet the criteria we set."

This plan highlights the economic benefits of the Local Government Pension Scheme in Scotland. Across the country nearly £20bn of assets are available for investment. UNISON has long argued that this resource gets insufficient recognition and should be used for public investment and to promote the living wage. 

However, UNISON has also warned that there is a real risk that the UK Government's attack on public service pensions could result in increasing numbers of workers opting out from these schemes. Something that even Lord Hutton highlighted again this weekend. That would undermine the viability of the schemes and have a knock on effect on investment into the economy. Not to mention increasing the burden on the state welfare systems in retirement.