Universities Superannuation Scheme (USS), the largest pension fund in the United Kingdom, has expanded its £1 billion ($1.3 billion) defined contribution section to include private markets in its asset allocation, becoming one of the first U.K. pension schemes to do so.
Private market assets have been difficult to provide to defined contribution members in the United Kingdom because they are not traded daily and incur high charges, according to the pension fund.
However, starting in February, 85,000 defined contribution members will see the investment remit of their funds in the Default Lifestyle Option expanded to include an allocation to private markets, which have previously only been available in the defined benefit section, according to USS. USS added that it plans to build up the allocation using new cashflows, but not with any extra cost to members or their employees.
USS’ allocation to private markets sectors encompasses 320 assets including infrastru