Gov’t to Increase Share of Pension Fund Investment in Private Entities

The Government will begin a phased process to increase the share of pension funds that can be invested in private company equity in the 2026/27 fiscal year.

This reform is intended to ease the five per cent cap that has limited participation of these funds in local corporate and infrastructure financing.

Minister of Finance and the Public Service, Hon. Fayval Williams, made the disclosure while opening the 2026/27 Budget Debate in the House of Representatives on Tuesday (March 10).

“We anticipate that together, with the Financial Services Commission (FSC), we will take a small but consequential step to increase the pension fund private asset limit from five per cent of total assets to 7.5 per cent of total assets,” she said.

The Finance Minister noted that this represents a measured, step to allow funds to begin reallocating to well governed private investments that match their long term liabilities.

It is reversible, allowing regulators to adjust if risks arise.

Subject to supervisory monitoring and in the absence of any unforeseen adverse consequences, the Government will complete the second phase of this increase to 10 per cent by April 2027.

The Minister informed that as at the end of September 2025, pension funds held approximately $847 billion in invested assets, of which roughly $42.4 billion, based on the current five per cent limit, is available for investment in the equity of private companies, the Minister noted.

Under the first phase of the reform, an additional $21.2 billion in long term capital will be available to be invested in private companies.

Mrs. Williams shared that phase two of the reform would have been tabled, were it not for the intervening events of the General Election and Category-Five Hurricane Melissa in 2025.

She advised that further drafting instructions were recently sent to the Chief Parliamentary Counsel.

“After this revision, the draft bill will need to go to the Attorney General’s Chambers, Legal Reform and then back to the Financial Services Commission. There is a companion bill that also needs the Tax Administration of Jamaica’s review… . I remain committed to seeing the passage of phase two,” Mrs. Williams said.