The MPs’ pension scheme has been accused of making “a mockery” of efforts to encourage investment in the London Stock Exchange.

The £855.5million Parliamentary Contributory Pension Fund had just £12.8million allocated to UK stocks at the end of March, compared to £462.3million in equities listed abroad.

However, the shock findings come after Rachel Reeves unveiled measures to encourage more pension investment in UK assets in a bill to become law next year.

The measures include consolidating assets and taking a reserve legal power to set asset allocation targets if a voluntary approach fails.

Ex-Chancellor Sir Jeremy Hunt said: “If Governments from both parties want pension funds to invest more in the UK, then it rather makes a mockery of things if the parliamentary pension scheme does the opposite.”

Charles Hall, who works as head of research at broker Peel Hunt, added: “It’s extraordinary that our own MPs have even lower allocation to UK equities than the average pension fund… It’s high time the MPs showed some leadership and backed UK companies.”

A Treasury spokesman said: “Our pension reforms will channel more of the nation’s savings into fast-growing businesses and vital infrastructure across the UK, securing over £50billion for the UK economy by 2030 and boosting retirees’ pension pots by nearly £30,000.”

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