By backing down on previous restrictive language, ministers have ensured that the new legislation remains “wrapper agnostic”, focusing on the quality and nature of the underlying assets rather than the specific legal structure used to hold them. This change effectively removes the administrative deadlock that threatened to exclude certain investment vehicles from pension portfolios.

The revised framework allows investment trusts and Real Estate Investment Trusts (REITs) to qualify for pension investment based on their exposure to productive finance, such as infrastructure, clean energy, and digital connectivity.

Christian Pittard, head of closed‑end funds at Aberdeen Investments, hailed the decision as “sensible, pragmatic step and a real victory for common sense”.

He said: “By utilising the established governance and transparency of listed vehicles, pension schemes can now more easily deploy capital at scale into the sectors that underpin the wider economy.”

Mr Pittard continued: “Aberdeen Investments has long argued that regulation should focus on what is being invested in, not the structure used to access it. Allowing investment trusts and REITs to qualify based on the nature of their underlying assets is exactly the kind of product‑neutral approach that enables better outcomes for pension savers.

“Investment trusts already play a vital role in financing infrastructure, digital connectivity, clean energy and the logistics backbone that underpins the wider economy. A framework that is focused on assets rather than structure will make it easier for pension schemes to deploy capital more effectively and at scale.”

This legislative progress is expected to accelerate the modernisation of the UK’s built environment while supporting broader economic growth. The move follows intensive campaigning from industry figures and members of the House of Lords, who argued that regulation should never penalise a fund simply because of its structure.

With the Bill now set to become law, the path is cleared for pension funds to leverage the expertise of the listed sector to finance essential logistics and utility networks.