The new head of the London Pensions Fund Authority (LPFA), Merrick Cockell, says the UK capital’s public sector scheme must lead other local government schemes around the country in joining forces to be more efficient on investments, liabilities and administration.
Cockell, officially appointed today as chairman of the LPFA, said: “The LGPS is a sleeping giant, and, instead of looking enviously at Canada or Australia, we should get on with creating our own LGPS equivalents.”
He said it was time to challenge the status quo in the UK’s Local Government Pension Scheme (LGPS) and show sector leadership.
While the LGPS is one scheme, its administration is currently carried out through 99 regional pension funds across the country.
“With so many councils proving they can co-operate by bidding together to Treasury for more devolved powers, we must urgently develop models that secure the appropriate level of local accountability whilst partnering on investments, liabilities and administration,” he said.
Cockell said the Lancashire and London Pensions Partnership (LLPP) model showed what could be done, and that this could be developed much further.
In July, the boards of the Lancashire County Pension Fund (LCPF) and the LPFA approved plans to form the LLPP, an asset liability management partnership that will merge the two pension funds’ investments, liability management and administration.
Cockell said it was an interesting and challenging time for the LPFA and the LGPS, with the government having made it clear in the Budget that public sector pension funds needed to change or have it forced upon them.
“Only through collaboration can we meet the desired outcomes and results needed to take the LGPS out of deficit and keep our future in our hands,” Cockell said.
Cockell takes over from Edi Truell, who left the top job at the LPFA to become the Mayor of London’s adviser on pensions and investments.
Truell was to promote collaboration between public sector pension funds and their investment in infrastructure and housing in London and across the UK.
He was also asked to set up an advisory board for the LLPP.