How political can LGPS get! Let’s rid it of localism.

Posted on February 11, 2025 by henry tapper

You’ll know Andrew Gwynne, a former Labour Minister who got a bit cocky on Whatsapp and paid the price with his career (for now).

Thanks to stalwart Dennis Leech, a pension prof. who can see the funny side of pension politics when they appear on our almost forgotten social media – twitter!

There is considerable concern in LGPS at the thought of a lot of jobs going, conferences shrinking and sales opportunities for fund managers disappearing overnight/

Of course it doesn’t make much difference to members whether the funds do well or badly, they have a Statutory promise they’ll get their payment so the question is whether we want funds going for growth or participating in the private sectors lock down as risk is taken off the table. This has been a disaster for private pension scheme, one that has been avoided by LGPS (to a degree). LGPS should not be too cocky, they have a tendency to be grandiose with the contracts they dish out, a habit that has made LGPS a feeding ground for institutional fund marketeers and related “pension experts”.

I should point out at this point that we do not live in little countries defined by our boroughs. I am as much British as the person living in Tameside and I want the best for him or her. But I do not want to spend taxes so that we have a pension system that goes towards Greater Manchester pull up the drawbridge or Tameside for that matter.

I am sorry but this kind of pension nimby-ism which looks after local issues by taking no risks , excludes the local council and the greater Manchester authority from a national plan to get us working as a country.

Over the past few days I have shown how Kensington is managing its pension for the good of local people, most importantly the victims of Grenfell Tower (who have not been well treated by the Borough so far IMO). I have read with dismay the angry people of Birmingham wanting to know what its pension scheme is up to when it comes to helping out its and other stricken councils.

Now I read that Greater Manchester Pension Fund (GMPF) is keen to resist being rolled into a bigger plan that might eventually have LGPS investing as one entity (worth north of £400bn rather than GMPS’s £30bn). It is delighted to tar Tameside which is looking to follow the big plan of Rachel Reeve and is using the personal embarrassment we heap on Andrew Gwynne as an example of how bad things will get.

This coming from a man who was described by his boss at Channel 4 as a professional trouble maker

“Crick adheres instead to the honourable belief that the job of the reporter is to create as much trouble as possible. He lives by his creed by bringing in scoop after scoop.”

Crick

Leave this man and his tawdry politics alone Dennis. He may be very clever but he looks to me to have a shrivelled vision. We are looking to move away from nimbyism in pensions in general and I’d include in that “localism” in the LGPS.

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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4 Responses to How political can LGPS get! Let’s rid it of localism.

  1. jbamdoc says:
    February 11, 2025 at 7.32

    I’m not aware of or getting into the personality politics of it all – not my area – but I can tell you Tameside is one of the very best run of the LGPSs, and it has scale. And one of their top people Ewan Milllar is now spreading the Elvis dust over at West Yorkshire LGPS.

    It’s obvious to all who follow policy noise that the ‘consolidation’ will be a precursor to TPR spreading their own form of de-risking dust, again…

    There is a wealth of good and experienced folks across the country running LGPSs (and of course some not so good), and a good few who could teach our regulators a thing or two about the practicalities of investing and running pension schemes. Would be a crying shame to lose that.

    Reply
  2. Dennis Leech says:
    February 11, 2025 at 7.32

    Brilliant report, Henry. Thanks for following up my suggestion.

    It is interesting that Crick reports some Tameside councillors (presumably including members of the pensions committee or their relatives) as saying that ‘much riskier investments’ could generate lower returns. This sounds like the kind of scaremongering that comes from people who have either a personal or commercial vested interest to either avoid change or sell derisking solutions.

    But the GMPT Annual Report for 2024 contains an actuarial estimate of the IAS26 funding level of 126%.
    https://tameside.moderngov.co.uk/documents/s172388/ITEM%2021%20-%20APPENDIX%207A%20-%20Statement%20of%20Accounts%202023-24%20PUBLISH.pdf

    That is the scheme is 26% overfunded and has a surplus of over £6.4 billion. There is surely no need to worry about investment risk with this level of surplus.

    Reply
    • jnamdoc says:
      February 11, 2025 at 7.32

      £6.4 billion is a criminal retention of value from the people, employers and businesses of Greater Manchester.

      I’ve challenged some LGPSs on this desire to squirrel away such excesses, who say they’re happy with the surplus as a ‘just in case’ buffer – a complete derogation of any broader duties.

      I’m not a fan of the threatened consolidation, but if it does come, at least it would knock some common sense into their funding approaches, with too many acting like a law onto themselves.

      Is the estimates for total LGPS surpluses at c£70-£100bn now? Could that be deployed to provide vital lifelines to support local services and kickstart local investment and growth?

      Urgent need for some joined up thinking on Policy needed ?

      Reply
      • Byron McKeeby says:
        February 11, 2025 at 7.32

        LGPS Advisory Board summary showed only £22bn at 31.3.22.

        Isio estimate £85bn at 31.12.24 but they’re just (ab)using rising gilt yields …

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