Magazine article Public Finance

Pensions Chief: Pooling Requires Attitude Change

Magazine article Public Finance

Pensions Chief: Pooling Requires Attitude Change

Article excerpt

The chair of a major council pension scheme asset pool has said a "mindset change" is needed to meet government ambitions to spread the practice.

Local Pensions Partnership chair Michael O'Higgins told PF that local schemes would need to adjust to the pooling of sovereignty required to bring assets into six British wealth funds.

The LPP initiative, which pools the management of liabilities as well as nearly £11bn of assets, was proposed last July by Lancashire County Pension Fund and the London Pension Fund Authority, and was officially formed last month with projected savings of £32111 over five years.

Chancellor George Osborne set out plans to merge all LGPS assets into six pools last October. Outline plans to create the pools were submitted to the government in February, and it was confirmed that Greater Manchester, Merseyside, West Yorkshire and the Royal County of Berkshire funds were in discussions to join the LPP. More details are expected to be submitted to the government on 19 July to meet ministers' target for six pools, with each at least £2sbn in size.

O'Higgins, who chaired the Audit Commission until 2012, said he believed pooling was the "right thing to do in the best interests of scheme members and taxpayers". He highlighted a willingness by elected members to recognise change was needed to make pooling work.

There must be a focus on getting the best deal for scheme members "rather than on their own status and kudos", he stated. …

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