LPFA In The News Archive

As an organisation LPFA will regularly feature in news articles, whether this is to do with topical issues around the Local Government Pension Scheme, or issues specific to LPFA. Have a look at some of the links below......


The importance of employer covenant checks Dec 12

See LPFA's article from Professional Pensions on employer covenant checks. Tony Williams LPFA's Head of Employer Services spells out the benefits of a risk based approach.

Response to the press release on governance in LGPS funds: Nov 12

LPFA welcomes the review carried out into the governance and management of LGPS funds in London. LPFA has been encouraging debate on this issue and believes there are improvements in governance and savings that can be made by reviewing the structure of London LGPS funds. The review suggests that some funds are clearly better run than others and LPFA is a strong supporter of encouraging best practice to bring all the funds up to the level of the best. LPFA is also keen that a National Pensions Board is set up for the LGPS to have an oversight role and collect and collate good quality data so that funds’ performance can be properly compared.

If we were starting again in 1965 we would be unlikely to create 34 funds in London in this manner and we believe a single fund of some £25 billion would generate significant savings over the current arrangements. It is likely that over the whole country there could be further savings from a rationalisation of the number of funds. There are potential benefits in terms of governance and economies of scale that could be achieved. This includes the potential to invest in assets which link well to the long term focus of pension funds – such as infrastructure.

It is important to note that LPFA would be a willing participant in any future structure for London but is keen for either London Councils or central Government to take any long term proposals forward. In the meantime LPFA will continue to work with London boroughs and county councils in assisting them with their LGPS needs.

One important point to note is that LPFA does not believe LGPS pensions are gold-plated. The recent review carried out by Lord Hutton suggested that the average LGPS pension in payment was around £4,000. This is lower than the unfunded public sector schemes and provides a vital income to many local government workers on retirement.

Mike Taylor, Chief Executive, LPFA

What's the reality of public sector pension reform? Sept 12

This article was written by Susan Martin Deputy Chief Executive and explores some of the myths behind LGPS reform

Proposals to create a pan-London LGPS fund: April 2012

London Pensions Fund Authority (LPFA) has recently appeared in the trade and national press (PDF 929KB - opens new window) regarding proposals to merge the LGPS funds in London to create a pan London fund. The proposals would involve the pooling of both investment funds and administration functions. The proposals suggest all the councils could benefit from reduced costs and greater buying power from the economies of scale of pooling the pension funds.

LPFA’s role in this has been to encourage debate on the subject with a view to see how the estimated £30m of savings might be achieved. A paper was issued to a Leaders’ Committee of London Councils in March where further research was commissioned and will be reported in July. There are significant challenges to investigate before the proposals can go any further but the move has been welcomed by the CBI and Eric Pickles who is “broadly supportive” of the plan.

Mike Taylor, LPFA Chief Executive:

The proposal could pave the way for an increased investment in infrastructure projects – providing the necessary investment business case was satisfied. This has received the backing of the Mayor of London Boris Johnson. LPFA has previously highlighted support for increased investment in infrastructure as an asset class since it is a good match for pension fund liabilities. LPFA has signed a Memorandum of Understanding with the Treasury which confirms participation in any discussions but does not commit LPFA to any future investment.

“It’s time to think: is this the most efficient way to do things. I’m pretty confident that nobody in their right mind would invent 34 different authorities to do the same thing, even non-core stuff like running pension funds.”

LPFA's response to investment infrastructure funds: January 2012

An article appeared in the Times this morning outlining an idea to use local government pension scheme assets to invest in infrastructure funds. This was headlined "Osborne to raid £140bn town hall pension pot" which was an incorrect summary of the proposal. LPFA's view is that infrastructure funds are a good match for pension fund liabilities and a proper asset class for a pension fund to invest in. Indeed we already have an allocation of £150m in such funds. LPFA has signed a Memorandum of Understanding with the Treasury which confirms participation in any discussions but does not commit LPFA to any future investment.

For LPFA the investment case is of utmost importance. If the returns to the fund are attractive and the investment case can be made with appropriate governance structures in place, then LPFA will investigate the possibilities further. Suitable guarantees would also be requested from the Government on the level of future returns


LGPS seeks greater influence in reforms: Pensions Week September 2011

 LGPS seeks greater influence in reforms - Pensions Week September 2011

UK pension schemes should be 'incentivised' for sharing admin: IPE Online Sept 2011

 UK pension schemes should be 'incentivised' for sharing admin - IPE Online September 2011

Mike Taylor, LPFA Chief Executive commented: 

"There is a lot to get done if we are to ensure a fair, affordable and, most important, fully understood LGPS is in place by 2015."

Lower LGPS accrual rate could make short-term Treasury savings: Professional Pensions Sept 2011

Lower LGPS accrual rate could make short-term Treasury savings - Professional Pensions September 2011

London plans 'fair and affordable' LGPS by 2015: Public Finance Sept 2011

London plans 'fair and affordable' LGPS by 2015 - Public Finance September 2011

Radical pension proposals unlikely to avert strikes: Financial News Sept 2011

Radical pension proposals unlikely to avert strikes - Financial News September 2011

Council staff risk being 'dragged' into autumn pension strikes: Local Gov Online Sept 2011

 Council staff risk being 'dragged' into autumn pension strikes - Local Gov Online September 2011