Britain’s pension providers and insurers have joined forces with the government to back a regional growth drive through a new group which will be launched at the first-ever Regional Investment Summit on Tuesday.

The Sterling 20 is an investor-led partnership between 20 of the UK’s largest pension funds and insurers working with the government and City of London Corporation.

Chancellor Rachel Reeves will meet the providers as well as Australia’s biggest fund at the summit in Birmingham.

She said the aim of the new group will be to channel the nation’s savings into key infrastructure and fast-growing businesses in key modern industrial strategy sectors like AI and fintech.

Legal & General and Nest will kick off the investment by committing billions to build more affordable housing, improve broadband connections in rural areas and provide scale-up finance for growing businesses.

L&G has made a £2bn commitment by 2030, to deliver around 10,000 more affordable homes for families and supporting the creation of 24,000 jobs nationwide. 

Nest will provide Schroders Capital with £500m, of which £100m is expected to be channelled into UK investments in the coming years. In addition, Nest will invest £40m to deliver gigabit-capable fibre broadcast to remote areas in Scotland and Norther England.

The Regional Investment Summit will also see the AustralianSuper, Australia's largest pension fund and 17th largest in the world, increase its investment into the UK housing market.  

Rachel Reeves said: “Our country’s pension funds are some of the biggest in the world. When they invest in Britain, everyone benefits – from the construction worker on site, to the small business on the high street, to the saver seeing their pension grow. Sterling 20 shows what can be achieved when we all pull in the same direction to build a stronger economy.”  

Torsten Bell, Minister for Pensions, said: “Our pensions system is one of the UK’s great strengths. We’re stepping up the pace of pension reform to support not just British pension savers but the British economy, supporting investment to deliver the growth of communities up and down the country.”

The formation of the Sterling 20 comes as pension builds on July’s Mansion House Accord, which saw 17 providers representing 90% of active defined contribution scheme savers, commit to invest at least 5% of their main default funds in UK private markets.

• The members of the Sterling 20 are: Aegon; Aon; Aviva; L&G; LifeSight by WTW; Mercer; M&G; NatWest Cushon; Nest Corporation; NOW Pensions; People's Partnership; Phoenix Group; Royal London; Smart Pension; SEI; TPT; USS - Universities Superannuation Scheme; Rothesay; PIC – Pension Insurance Corporation; PPF – Pension Protection Fund.