I am currently the guest of the Local Government Chronicle in a very nice hotel in a not very nice bit of Leeds. The hotel’s a bit above my pay grade but I’m here to speak about topical pension issues with Tom McPhail and Joanne Segars, so I suppose it’s a pay bonus. Sadly it means that I can’t celebrate with the CIPP.
Keeping people paid, is a matter for employers and for pension funds. I associate LGPS with payroll because most of my contacts there are helping out members with their AVCs , their tax problems and their questions about how pensions work (the things that payroll do – above their paygrade). Pensioner payroll is of course vital to LGPS as all other pensions schemes.
But payroll wasn’t the topic of conversation when I crashed a party of top LGPS investment experts at a bar called “Revolucion de Cuba”. Everyone was talking about Government interfering in their investment decision making – again above my paygrade
As I supped and ate canapes, I half expected the “revolucion” to arrive at the door in the uniform of the CIPP, demanding better representation for the employers who participate in LGPS funds. Employers appear a million miles (metaphorically) from the discussions on pooling and transitioning, I found myself having.
Nearby in Leeds, Steve Simkins was getting grumpy on linked in for this very reason
It’s fascinating that across all of these comments there are no references to employers. Many employers are currently over 100% funded on a very low risk basis which should cause them to want to derisk and which in turn challenges the whole debate around pooling, private equity, levelling up etc
Steve is a trombone playing actuary with a client bank of employers who participate in LGPS, often reluctantly and are chiefly concerned about the cost of that participation. Those clients should be happy enough that LGPS has swerved LDI and is currently swanning in the sunny uplands of high surpluses and talking the politics of investment.
All the talk is about the Mansion House reforms and the Government’s plan to require LGPS to change its investment management and governance, through an open consultation.
The funds and pools are here in force but is anyone asking employers about whether LGPS should take on more risk as detailed in Steve’s moan? Well anyone can respond and the consultation is still open so there’s still time for Steve’s employers to have their say. But having scanned the delegate lists, not many will have their say at this conference.
While we are discussing the politics of pensions , the state of local government is a matter of national concern.It will be interesting how the crisis in Birmingham (and elsewhere) touches this conference.
Steve’s moan had been triggered by a long and detailed article by Martin George in the Local Government Chronicle, which you can read here
Steve’s point is spot on, there are not two but three agendas at play
- Government wants to see LGPS consolidating and investing for the common good
- LGPS funds and pools want to exercise their skills without interference
- Employers want stable costs for participating in LGPS.
Government . funds and pools will be here in Leeds, but not employers and I fear not Steve Simkins. All the payroll people are off partying for national payroll week. As for the members, I see no unions on the delegate list.
So. as with the conference I went to in June with the PLSA, I will be listening out for and asking question on behalf of employers and members whose voices tend to be drowned out as large institutions pitch for mandates. I may not have the swanky suits of the asset managers but I have a gob on me, and I intend to use it. I might even catch up on Steve Simkins, as Isio’s offices are just around the corner.