There is a row in Birmingham between some professors and the executive of Birmingham and it has been a matter for the Birmingham Post. I wrote about it earlier in the year and was sent the paper (which being in early stages of recovery, I missed).

Here is the blog that set it all going and I don’t want to get involved in the argument other than to make a point , made by Joanne Donnelly on Linked in , that the Local Government Pension Scheme is not backstopped by the PPF but by the tax-payer. If you are in LGPS as a current or future pensioner, you have an ace guarantor.

Joanne should know , she has spent her life in public service – the Treasury and Local Government in particular. The question being put by the professors is the other way round, they want to know whether money they consider better invested in a bankrupt Local Government – Birmingham, can be released.

It would be really interesting, if Joanne or one of her new team, can send me an explanation of how this row built up and why the row doesn’t seem to be going away. Most people pay Council Tax and Income Tax, we would like to know who is protecting who.

How long will it take Max Caller, the Chief Commissioner of Birmingham City Council, to confirm that the pension fund surplus reported last March in the City Council accounts was £417million? 

This was the blog that I was asking for

The respondent sending me the angry blog suggests that West Midlands is not managing money very well.

All very interesting – and the comparator West Yorkshire scheme does indeed appear to have a much much lower cost investment strategy – all managed internally with no performance

I have had cause to question why its recently acquired administration system seems so inept, leaving people waiting for payment of pension. But these are minor type issues to worry about , when we think about the allocation of pension surplus, which we do a lot today.

People on Linked in have been asking why West Midlands, of which Birmingham’s Local Authority pension is a part, is still demanding 38% of pay for membership. If this is right then the issue of surplus , mentioned in the article above is of particular pertinence.

Last week, Kensington announced that it was going to reduce its payments to 0% and pay the amount saved into the Grenfell victims fund, it did it on the day that Angela Rayner said the Government would dismantle the Tower. I suspect that there is a lot of politics going on in Kensington and a lot in Birmingham and none of it makes sense to ordinary people, most of whom are required to pay money into a pension pot , a system they are auto-enrolled into. I believe that goes for Kensington Borough employees who are enrolled but not paying.

Kensington’s pension holiday is only till its tri-annual review which is next year and this is the same for Birmingham. If I lived in Birmingham and was facing cuts in council services because there was no money, I would be pretty sick to hear that there is money in the pension scheme that is serving little purpose and that the pension scheme is demanding a fairly large contribution when in surplus. Which may be why the state of the scheme may not be being displayed.

In short, the Local Government Pension Scheme must be on better terms with its local taxpayers and make it clear how the deal works. Right now, no-one knows and there are articles on Linked in, in academic blogs and presumably up and down the area of West Midlands.

It sounds like there is a good news story to be told, a story of successful investment. But why the uncertainty? Transparency has a lot going for it, better information would be helpful.