Currently the beleaguered Council Tax Payers of London are paying for thirty three investment funds , thirty three investment advisers, thirty three investment strategies and thirty three sets of decisions – when one would suffice.
What’s worse, because of the convoluted procurement process that they are required to go through, taking a timely investment decision is nigh on impossible.
There are two negative outcomes to this . Firstly London Borough Pension Schemes are paying over the top for advice, trustee meetings and funds. Secondly they are taking sub-optimal investment decisions because they neither have joint buying power nor have they delegated authorities to a center of expertise.
What’s behind this inefficiency a lot of consultancy that would be lost through consolidation into a Common Investment Fund, a lot of decision makers who would find themselves with little residual authority and a lot of inertia (as this is not a subject very high on anyone’s agenda).
I know there are arguments that each Borough needs a separate strategy because they have individual funding problems but this can easily be dealt with through the unification of the CIF (as is done elsewhere).
Similarly there will be issues surrounding the redeployment of the many investment experts whose livelihood is tied up with these inefficiencies.
But really and truly it is time that somebody blew the whistle on this nonsensical investment structure
GIVE THE LONDON BOROUGH’S PENSION FUNDS A COMMON INVESTMENT FUND AND FAST.
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