Major pension funds have called on the British government to overhaul one of its fiscal rules in its budget later this month, adding to growing calls for the country to encourage more investment in infrastructure and green technology.

The call comes as finance minister Rachel Reeves prepares to present the Labour Party's first budget on Oct. 30 since it won power in a July election with promises to get Britain's economy growing more quickly.

The UK government will host a high-profile meeting next Monday with international investors whose cash they will need to help fund projects.

Australian pension fund IFM Investors, which manages around $146 billion of assets globally, made its recommendation in a report published on Wednesday, which it said was backed by other funds including Britain's Universities Superannuation Scheme.

The report urges Britain to adapt a fiscal rule for calculating public sector debt to allow for investment by public bodies to be accounted for as assets. The investments are currently only accounted for as a liablity under the rule.

"In our view, this does not make economic sense and may be a barrier (to investments)," the report said.

Britain's finance ministry was not immediately available to comment directly on the proposal, but a spokesman said the upcoming investment summit would "bring together investors from around the world to show what the UK has to offer".

The Guardian newspaper reported on Tuesday that Reeves is likely to free up 10 billion to 20 billion pounds' worth of room to borrow for capital investment by tweaking other technical definitions that underpin the government's fiscal rules.

Reeves met with bosses of some of Britain's biggest banks including HSBC, Barclays, NatWest and Lloyds earlier on Wednesday to hold discussions on financing infrastructure, the transition to net zero and UK businesses critical to the so-called "national growth mission".

Banks and trade bodies have intensified their lobbying efforts in recent weeks against any potential tax hike on the industry, sources previously told Reuters.

(Reporting by Iain Withers and Sinead Cruise Editing by Gareth Jones)