Five local authority pension funds are seeking expressions of interest from asset managers in a new investment initiative to deliver financial returns and create a positive economic impact.

The group of funds involved are Greater Manchester Pension Fund, West Yorkshire Pension Fund, West Midlands Pension Fund, South Yorkshire Pension Fund and Merseyside Pension Fund.

Each of the participating funds has agreed to invest up to £50m initially, should suitable investments be available.

As well as seeking to deliver financial returns, the funds are also looking to invest to invest for the benefit of local communities and address some of the current economic challenges.

The range of investment activities will include those that have beneficial economic, social and environmental impacts, and underlying investments could include infrastructure, resource management and business development.

Councillor Kieran Quinn chair of Greater Manchester Pension Fund and Leader of Tameside Council said: "A pension fund has an overriding responsibility to make a financial return that will assist it in meeting its pension liabilities without taking unreasonable risks, but it is clear that in meeting these criteria there are investment opportunities that will also deliver an impact on local communities that improves their economic wellbeing, including social and environmental outcomes.

"Funds have taken a number of such investment opportunities and this initiative is not only to establish the depth and breadth of the current market, but to challenge asset managers to bring opportunities forward on sufficient scale to match the investment allocations pension funds are prepared to commit."

The deadline for submission of the proposal is 5 July 2013.

First published 24.05.2013

monique_simpson@wilmington.co.uk