what are the lgps pools

Now it has the C-suite in place and has hired people on the operating side, it will start recruiting for the investment side. Were in a state of limbo.. If you could do as much as that over the next five years and more, we'd have done a hell of a job for taxpayers, employers and all the stakeholders. But, there are scenarios where that could be given a much firmer push. Where our partner funds differ is in their SAAs and the levels of liabilities. In its response to LGCs FOI request, LPPI said its three client funds the Royal County of Berkshire Pension Fund, Lancashire Pension Fund and the London Pensions Fund Authority have all been 100% pooled for each of the past three years. The UKs 89 Local Government Pension Schemes (LGPS) have finalised their asset-pooling plans ready for this months deadline. Our top priority is to prove that we can deliver performance and the cost savings that are factored into all new product launches. She added: In doing so the government should ask officials to have open conversations with funds, pools and the advisory board to learn the lessons of this first phase and try to gain some consensus as to where to go from here. We'd probably all say we're a bit frustrated that we haven't been able to move quicker and do more. By Phil Triggs. Our joint governance committee, which is the chairs of the Welsh pension funds, has been pretty stable because we haven't had any elections now since 2017. To date, we've pretty much pooled half of the available assets in the ACS or through the jointly-procured passive manager; the pipeline for us would take that to about 70%. Legacy illiquid alternative positions and current direct property positions may be inappropriate for pooling. It has already contractually pooled circa 11bn of passive assets under a single commercial relationship with UBS, which is expected to generate 5m cost savings per annum. Some have opted to create their own services companies, regulated by the Financial Conduct Authority and launching their own authorized contractual scheme (ACS), tax-transparent funds designed largely for institutional investors. Eight LGPS pools have been formed across the country and billions of pounds worth of assets have been merged, but the "sovereign wealth fund" label was discretely ditched along the way. It's certainly been a fantastic journey that we've been on over the last couple of years. Pools that have clarity of what pool funds are needed from their partner clients and agreement for the order they will be provided will in general have made greater progress, she said, but that rule doesnt necessarily apply if the partner funds have more difficult assets to transition in existence, such as illiquid assets.. Since getting FCA authorisation two years ago, 9.5bn of assets have been pooled across global equities, private equity, infrastructure and credit. At the same time, we are expanding the products that we offer, so there's multi-asset credit, and emerging market debt. But this has given us the opportunity to look at policies and governance again. I'd like to think in five years' time a lot of our investments will be ESG-focused and that we'd therefore have a lower carbon footprint as individual funds and as a pool. We were quite lucky. They are able to bring some insight into the board's decision making. 'Is it working today? However, he called for more consistent data because at the moment there is no unanimity on any method for calculating pooling savings, and there is no clear understanding as to where passive funds stand in the pooling or otherwise category. We would look at it with an open mind, which we have done, and if there was value there we would do it. LGPS Central launched on schedule in April with three pooled funds in global equity passive, UK equity passive and global dividend growth factor equity totalling 5.5bn. If we get that right, that increases the confidence of our partner funds, and the process will move smoothly through asset transition into business as usual. 'Weve been caught in a bit of a vacuum where weve not been assisted by the government'. The eight Welsh funds have appointed Link Asset Services to provide the infrastructure for pooling, while Russell Investments will help with manager selection. On the former, he said we just havent seen that come through at all, while on the latter he said: Weve been asking various organisations to articulate exactly how pooling will improve fund performance and really weve got no answer so I have to assume this statement is unsubstantiated., He said he was concerned the government may try to make pooling even more mandatory, adding: Lets face it, if was pooling was so good, if the value was there, you wouldnt need to make it compulsory. LGPS funds: Bedfordshire, Cumbria, Durham, East Riding, Lincolnshire, North Yorkshire, Northumberland, South Yorkshire, Surrey, Teesside, Tyne & Wear, Warwickshire, Key staff: Rachel Elwell (CEO); Fiona Miller (COO); Chris Hitchen (chair). Welcome to the Northern LGPS | Northern LGPS We've been less worried about the vehicle. Click Here. We have already worked with partner funds on what their SAA reviews look like and how that might affect the fund launches that we've got planned. The fact that there's a bit of variation between pools on approach and structure, etc. In the 2015 Summer Budget, it was announced that the UK government would work with LGPS administering authorities to reform how LGPS investments are managed. However, this also means that more than 90% of LGPS organisations across the UK did not submit applications. So, yes, it's been a good start, but more to do. The eight pools are still very much in their formative years, and will be for some time yet to come. What we already had in common has proved to be an effective foundation. This is a question that has been asked for months, if not years, as we await the government's long-promised review of a structure that currently comprises eight pools with around 300bn of assets. Phil Triggs, tri-borough director of treasury and pensions, Westminster City Council. Planners order demolition of pool building at Captain Tom's daughter's home. Read more: Interview with Rachel Elwell - How Border to Coast is meeting pooling challenges Brunel Pension Partnership The eight pools have tried their best in the testing circumstances in which theyre operating, and it is moving ahead.. Some 14.6bn has been pooled or is under the London CIV's control, with another 1bn in the pipeline over the next couple of months, and five new funds due to launch over the summer. The eight funds in the Wales Pension Partnership had pooled an average of 71% of their assets at 31 March 2022, according to WPPs FOI response, which included active and passive investments. That simply reflects different starting points. CEO Dawn Turner says: "Unlike the other ACS rental approaches, Brunel will be the investment manager, which enables us to be fully in charge of the selection of managers that go into the sub-funds. The UK's 45 billion Northern LGPS pool has eschewed creating a separate FCA-regulated entity, seeing it as an unnecessary expense. One thing we are very focused on is liquidity management within the funds, making sure that we have sufficient liquidity to manage the balance sheet of the funds properly given market liquidity has been somewhat challenging of late. Northerns infrastructure fund, GLIL (originally set up by Greater Manchester and LPFA), has 1.3bn committed and about 500m at work, and is close to obtaining FCA registration, which will open it to participation by other pools and funds. The LGPS pools have not been short of good examples in terms of taking their respective LGPS pools from vision to existence. But as theory increasingly moves to practice, it is only natural to expect further adjustment of operational models, processes and practices across the LGPS. LPP and LGPS Central are up and running already, and there is an interview with LGPS Centrals chief executive, Andrew Warwick-Thompson, on this website. Although we are moving in different directions, we are still connected. We're working through funds that are more illiquid and slightly harder to design. All three models are FCA-regulated companies and Mifid II-compliant. If you have any problems with your access or would like to request an individual access account please With pooling, what we were trying to get away from was short-term decision making, if it existed, towards looking at performance over a business cycle, a period of five years or more. Follow this link to read further articles in this series. The Government announced earlier this year that around 900m of cost savings are expected by 2023, based on assets transitioned to date. DLUHC told LGC it was considering how the framework for LGPS investment should be strengthened, including stronger governance, improved reporting, and greater transparency on investment performance. But if you look at it from a standing start in April 2018, we've come a huge distance. I'm looking forward to much more hard work, much more challenge, but we'll overcome that with more communication with all of our stakeholders, and building more consensus with the partner funds. LGPS pooling - maybe half a dozen did mean six after all? | Linchpin The current situation will have an impact on the delivery of that pipeline. Obviously, responsible investment is a key focus for us. Framing the whole pooling initiative in the context of the greater mission and then thriving is personally hugely engaging. A spokesperson said: We welcome the achievements of the LGPS asset pools, which have saved 200m to date by realising the benefits of greater scale and collaboration. In 2015, chancellor George Osborne set out plans for pooling Local Government Pension Scheme fund assets into up to six British wealth funds, containing at least 25bn of scheme assets each. Planners order demolition of pool building at Captain Tom's - ITVX So, how important is vision and how vital is it that an effective leader should take the helm? As an academic study for the global pension fund investment management fraternity, LGPS pooling will be a fascinating case study, both in terms of overall cost reduction and in terms of net costs returns. It will seek to offer investment funds across fixed income, active and passive equities, private equity, infrastructure, and property. The support of the section 151 and other senior officers is really important. It is a combination of absolutely making sure that what's already transitioned is being run well in these challenging market conditions. The officers and the elected members at each of partners funds have, by and large, remained the same. The Wales Pension Partnership is the first LGPS investment pool to AE savers feel positive about pensions ahead of rate rise, Defining the two types of cashflow-driven investing, Key risks to watch out for in impact real estate, DB funding - August 2022: Surplus improves by 60bn, The webinar will look at at how schemes are managing portfolios in the current landscape, Letter signed by ten pension funds calls for reconsideration of FCA listing rules, Incisive Business Media (IP) Limited, Published by Incisive Business Media Limited, New London House, 172 Drury Lane, London WC2B 5QR.Registered in England and Wales with company registration numbers 09177174 & 09178013. The proportion of assets transitioned ranged from 42% in Norfolk to 79% in West Sussex. Keith Onslow (Con), chair of Bromley LBCs pensions committee, He said Bromley was not against pooling, but added: Our main problem at the moment is trying to find value in pooling. 4 min read LGPS pooling - maybe half a dozen did mean six after all? It has been a learning curve but we are blessed with ten clients that really want to work together to build something that works for all of them. Building on that collaboration as part of the product design and product governance work has really helped. Sharp drop in LGPS fund and pool signatories of stewardship code O'Higgins says: "We've saved more already than our business plan set out (the initial estimate was 30m net savings in investment management fees over five years),and as we continue to try to improve efficiencies, we anticipate more savings particularly on administration. LPP has a 320m fixed income fund, a 1.3bn credit fund, the 1.3bn GLIL infrastructure fund and a private equity fund. We probably would have been right in the middle of that now, but that has been a bit held up by Covid-19. The levels of asset transitions have led to questions about the ability of pooling to realise the savings originally promised, and fears the LGPSs ambitions on climate change and levelling up will be hindered. Welcome to IPE. The ACS will require FCA authorisation. All three will manage assets through both internal and external management, thus conforming to the desired visions of lower costs and above benchmark net of fees performance. A number of pools were formed and governance structures put into place. They tend to have quite a lot of illiquids in them. Northern is a local government joint committee rather than a stand-alone legal entity, and has three partner funds: Greater Manchester, Merseyside and West Yorkshire. LGPS: Pension Pooling in the UK, which was commissioned by seven UK LGPS pools to look at markets where pooling was more advanced, said benefits of pooling for LGPS funds included better long-term performance after fees, improved control over investments, an enhanced approach to responsible investment and reduced costs. Northern LGPS represents about a fifth of total LGPS assets, has approximately 880,000 members and over 1,100 contributing employers. LGPS pooling: Building on commonalities to maximise outcomes Not all of the London boroughs have bought into the solution and the pool is still seen by some as an option. How wrong I was about pensions, Aggregate surplus of UK schemes fell over June to 131bn, down from 140bn in May, 'Growing mismatch between number of schemes and insurers available to transact, XPS will advise on investment matters with social impact investor Big Society Capital, Incisive Business Media (IP) Limited, Published by Incisive Business Media Limited, New London House, 172 Drury Lane, London WC2B 5QR.Registered in England and Wales with company registration numbers 09177174 & 09178013. If you have any problems with your access or would like to request an individual access account please But situations like this really bring home that - as long as you can do this in a risk-controlled way and it's within the risk appetite of the partner funds - you really do want day-to-day investment decisions made in the pool because that's where governance can really support that. However, they have targeted significant savings from clubbing together on private equity and other alternatives. In recent months, there has been some chatter or comment within the industry around London CIV having too many cooks in the kitchen. Its governance set-up was then criticised in a Willis Towers Watson report, urging the London CIV to overhaul the structure in order to be successful. Emerging markets equities have also been delayed. An LGC investigation has uncovered huge variation in LGPS pooling rates as ministers mull the programmes future, writes LGC deputy editor Martin George. The pool's original cost-saving estimates original were 27m annually by 2021, increasing to 55.2m by 2030. Read our policy. Transition costs Medium Risk Asset The delay in doing the transitioning has meant that we could look at the other areas now which will fulfil our governance and audit requirements. The LGPS pools have not been short of good examples in terms of taking their respective LGPS pools from vision to existence. What is clear now is that it is not the role of London CIV to restrict any choice based on its own view of effective investment. The next stage is maturing the way we manage the pools and maturing our business. The combined assets of the funds stood at approximately 53bn as of 31 March 2021, which is invested on behalf of over 800,000 members and 1,250 contributing employers. Report highlights benefits of pooling pension assets for LGPS The difference is explained by the exclusion from the FOI response of the funds passive investments, which Border to Coast supported in a joint procurement, and their private markets commitments of nearly 10bn, which funds are legally committed to but which had not been invested at the time. LGPS-Live is a webinar series focusing on the key issues for LGPS pension funds and pools. I don't think is a bad thing. LGPS Scheme Advisory Board - Home So that will be my number one action the government should take.. contact our customer service team. Having 32 partner funds does add to the degree of interest and that has made a bit more challenging to get alignment. Chief executive Rachel Elwell, who joined in November, says: "It's absolutely right to do it correctly, not quickly, butideallyyou still have a little sense of pace as it's important to get it done.". In contrast, it said other pools have too many partner funds to do this and have therefore implemented more appropriate company structures with the necessary cost of doing so. The government remains committed to asset pooling. The current Dalai Lama Tenzin Gyatso once said: In order to carry a positive action, we must develop here a positive vision. His teachings may be far from those of traditional leaders (for example, he is also known as the ocean of compassion) but for those who are interested in building and running long-term, sustainable business entities, these words that there is more than just the bottom line resonate. Obviously, there's also a massive impact on the partner funds' capacity. Hyde Harrison says the main issue is the pool was originally supposed to be only voluntary for the boroughs, because it was set up before government policy took a different turn. Find company research, competitor information, contact details & financial data for MESSINGER FABRICE of ROPPENTZWILLER, GRAND EST. UK roundup: LGPS pools announce EM sub-fund launch, PE milestone The WPP is a collaboration of the eight LGPS funds (Constituent Authorities) covering the whole of Wales and is one of eight national Local Government Pension pools. The most challenging by a mile is real estate in terms of trying to line up tax and regulatory. LGC sent freedom of information requests to all eight pools asking what proportion of each of their partner funds assets had been transitioned for each of the past three years. We're just being very mindful about building out our methodologies and managing liquidity to make sure that we can be resilient, because there are a lot of uncertainties in the portfolio and, from a funding perspective within the local authorities, what might happen to contributions. Access Pool | Effective - Collective - Investment 25th January 2022 - Representation on LGPS pools. I would reflect slightly differently on how we best support our partner funds as they go through strategic asset allocation (SAA) changes while we are still building the pools. This really helped us get some commonality before we actually went into pooling. It's just a challenge. In 2018/19 we expect to deliver more than 1m in administration cost savings. So why havent more assets been pooled, and why is there so much variation? This outsourced model means little need for extra internal staff. The Local Government Act tool kit did not completely work for the types of solution that were required: the Financial Services and Markets Act (FSMA) was required as well. Some are not really'. "LGPS funds are both shareholders and clients of the investment pool companies, which can sometimes result in difficulties in separating the roles that the LGPS fund holds within the pool companies, providing for some interesting discussions on occasion." We are committed to achieving further savings and other benefits, as funds deepen their collaboration with their pools. I don't know. West Yorkshire is run very efficiently in-house it is widely regarded as having the lowest costs in the LGPS and was vocal in its protests that pooling costs would never be recovered. We've made a good start but there's still much to prove. There are more choices to be made about fund structure and approach. In January, the pool applied to set up an FCA-regulated investment company to manage assets through both internal and external management with a number of vehicles, including an ACS. LGPS funds: Greater Manchester, Merseyside, West Yorkshire, Key staff: Peter Wallach (head of pensions, Merseyside); Rodney Barton (director, West Yorkshire). Last year, it launched credit and global infrastructure funds, and in March a 320m fixed income fund. We were able to look at that as our starting position and move forward from there. The pool said 19.2bn of the 28.5bn is in pooled vehicles, a figure which excludes advisory/ discretionary mandate information. In December 2019 Councillor Roger Phillips, SAB Chair, wrote to the LGPS asset pools which had yet to include some form of scheme member representation in their governance arrangement in accordance with the Board's policy objective agreed on the 23rd March 2017 and updated in May 2018 (see below). We're heading in the right direction. He told LGC: "I think the danger is that at a pool level you start to compete against each other. This is problematic because, as per the guidance, while there may be a limited number of existing investments feasibly less suitable to pooling arrangements (such as local initiatives or products tailored to specific liabilities), these exemptions should be minimal and should have been set out clearly in the July 2016 final submission. LGPS Investment Pools. Pooling has rewritten LGPS investment. Since recruitment began in May 2017, there has been strong focus on building the board and the executive team. You have to make sure that you've got your proposition set up so it facilitates that. Guidance published at the time said "plans should be made to transfer assets to the pools as soon as practicable," with an expectation "liquid assets are transferred into the pools over a relatively short timeframe," although there was a recognition "illiquid assets are likely to transition over a longer period of time". The UK's 89 Local Government Pension Schemes (LGPS) have finalised their asset-pooling plans ready for this month's deadline. What I mean by that is the good ones will flourish, the bad ones will fall away. We're probably a little bit more focused on the complexity; we've done the easy stuff now. I for one am keen to see government recommit to pooling and to share its vision for the future bearing in mind the very real challenges of climate risk reporting and levelling up investment ambitions, he added. It's trying to work out the way of reducing these fees some way or other, and seeing if we can get the managers we currently have on board to try and reduce the fees and to consolidate as well - not necessarily go through the full pooling mechanism but try to do a bit consolidation, first of all. sign in. Brunel will shortly put out a tender foran authorised corporate director to be the ACS platform for 8bn of active equities. We're really very much still on a journey. As pictured clockwise from top left above, Mike Weston, chief executive at LGPS Central, Laura Chappell, chief executive at Brunel Pension Partnership, Mike O'Donnell, chief executive at London CIV, Richard J Tomlinson, chief investment officer at Local Pensions Partnership, Kevin McDonald, interim director at Access Support Unit, Rachel Elwell, chief executive at Border to Coast Pensions Partnership, Anthony Parnell, treasury and pension investments manager at Carmarthenshire County Council, host authority for the Wales Pension Partnership. It transcends all of us, but it is so important. "Many of the other pools have spent a lot of time on how they would approach investment and what their approach would be," he explains. We have to prove that our governance structure works and adds value. But much will be determined by the governments long-awaited guidance or regulations on pooling which many expect to be further delayed by the change in government. This is paramount. And although that means it's well established, there will be still aspects of learning and development which an ACS has to go through. 21st January 2022 PSPJO Bill amendments for LGPS Amid political concerns that central government could interfere with the investment strategy of local authority pension schemes, a much more laid-back . LGA to expand peer review in wake of council failures, Hunt wanted 50% cut to public health, says ex-PHE boss, Labour promises to build more affordable homes, Exclusive: Woking prompts us to look at access to the PWLB, says Gove, Exclusive: Gove vetoes level two plus devo deals, Gove doubles down on opposition to four-day week pilot, Charting commercial routes to parking fees, Looking forward to another successful decade for DBS, Realising the benefits from your PFI/PPP contract, We can beat inflation with outdated spreadsheets, said no council ever, Thinking the unthinkable with frontline services, Head of Legal Services and Monitoring Officer, Head of Safer Communities & Vulnerability, Strategy Planning Manager (for Chief Executive). Border to Coast is fortunate because the partner funds, while not regionally based, made an active decision to work with each other. Pensions, Pooling and Private Markets - bfinance.com We've started looking at real estate now and that is more complex, because different types of real estate mandates are really challenging. That's been really helpful to have that buy in in from the higher level down to the lower level. While it is one of the smallest pools, it hopes to reach 15bn AuM when Berkshire Pension Fund comes on board in late May/early June. The LGPS should be commended for the work it has done in the last two-plus years to get these pools set up in such a short space of time. Link Asset Services will also work with Russell to further reduce costs through a multi-manager structure, currency management, portfolio overlays, transition management and other execution services. It is renting an ACS operator, and appointed Link Asset Solutions in March. Mike Weston, chief executive, LGPS Central Formerly known as 'Northern Pool', it is one of Britain's largest public investment funds, with combined assets under management of 46bn.
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