Local Authority Conference round up - academies, infrastructure and pooling
19 May 2016
The PLSA’s Annual Local Authority Conference took place in the Cotswolds this week. It was a lively three days of discussion and debate. Delegates heard from the Local Government Minister, the Economist Carl Tannenbaum and journalist Michael Crick, amongst others. Certain hot topics came up time and time again at our largest ever Local Authority Conference.
Marcus Jones MP, Minister for Local Government kicked off the conference by setting out his priorities for the pooling agenda.
We heard from the project teams work on the pooling of LGPS investments - hurdles they have had to go through and the learning points.
Fiona Miller from Border to Coast and Matthew Trebilcock, from Project Brunel, two of the largest pools that have formed talked us through the features and governance of their new pools.
These speakers were particularly excited about the opportunities that the pools were presenting to invest at scale and give smaller funds access to investment opportunities that would not have been considered value for money before.
Everyone engaged in the process has been struck how they have discovered more similarities than differences when they embarked on this journey. That being said, the challenge to get the pools developed on time, on top of the day job, has not been a walk in the park and delegates welcomed the opportunity to share their successes and gripes with colleagues from across the LA landscape.
Marcus Jones MP gave us some insight to the Government’s current thinking on a national infrastructure platform for LGPS infrastructure investments. The Chancellor, George Osborne announced this platform in the March Budget this year. He highlighted that Government are actively looking at ways to make such a platform work, building on the learning points from project pool. At this stage, they are not ruling out either building a government run platform from scratch, or piggy backing on existing structures such as the PLSA’s Pensions Infrastructure Platform.
Delegates were keen to articulate the need for a fund that doesn’t limit itself to UK infrastructure alone.
Councillor Roger Phillips, the new Scheme Advisory Board Chair – rather aptly called the Government’s recent decision on the forced academisation of schools a z-turn rather than a U-turn.
Since the 2016 Budget, the Department of Education has been facing increasing dissension over the decision to turn all remaining primary schools and secondary schools into academies. LGPS funds have been casting a nervous eye over the debate, knowing that academy conversion results in a new scheduled body in their fund. This has contributed to a dramatic increase in the number of employers in the fund (11% in 2015 and 14% in 2014).
The DfE announced last week that instead of turning all schools into academies those with ‘outstanding performance’ would continue to have the choice to remain under Local Authority control. It’s not yet clear what criteria the Government will apply to determine which schools will instead be obliged to academise, but regardless the message still remains the same that Local authority funds can continue to see an increase in the number of employers they see participating in the fund.
We also heard from the department of business, innovation and skills on an upcoming consultation on the implications of pensions for the solvency of further education colleges.
NEW GUIDANCE FOR EMPLOYERS AND FUNDS
The Conference also saw the launch of PLSA guidance - a made simple guide on Environmental, Social and Corporate Governance for funds and a best practice guide for employers in the LGPS.
HAVE YOUR SAY
The PLSA is looking for members to join the Association’s Local Authority Committee. The Committee, which reports into to PLSA’s DB Council, is a forum for Local Authority Pension Funds members to discuss issues particularly pertinent to them and to feed into the Association’s public service policy-making activity. If you would be interested in joining the Committee please contact [email protected].
Helen Forrest Hall
Policy Lead: DB