Pooling | Feature
Pooling: One size (does not) fit all
With the eight LGPS pools opting for different approaches to managing their assets, Mona Dohle asks if they can continue to work together in such a diverse setup.
than 100,000 people signed a petition call- ing on the government not to interfere with the investment strategy of local authority pension funds. The Ministry of Housing, Communities and Local Government – the department responsible for the pooling process – accommodated some of these concerns in its 2015 pooling guideline by stating that local authorities were invited to “lead the design and implementation of their own pools”. The only common standards set out were a minimum size of £25bn, which is
no longer
applicable, and transparency
regarding any cost savings and infrastruc- ture investments. At the same time, the ministry set an ambitious timeline of all eight pools being formally established by April 2018.
This initial formation stage took place in the context of two general elections, a refer- endum on EU membership and under the governance of three different prime minis- ters, while the Ministry of Housing, Com- munities and Local Government was led by no less than four different ministers, a fact
which is likely to have contributed to the relative independence with which LGPS pools were able to shift billions of pounds of assets into their new structures.
GROWING APART
The eight pools can be ranged according to varying levels of integration. Among the early adopters of the pooling progress are Local Pensions Partnership (LPP) and Bor- der to Coast, although these pools have cho- sen quite different approaches. Border to Coast, which manages some £45bn in
Issue 89 | December-January 2020 | portfolio institutional | 33
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