Hammersmith explores 'intra London' admin service
UK - The London Borough of Hammersmith & Fulham is exploring the possibility of establishing an "intra London authority" framework for pensions administration, as its existing mandate with the London Pensions Fund Authority (LPFA) is about to expire.
In a Prior Information Notice (PIN) issued through the European tender database, the London council revealed it is currently reviewing its options for the provision of administration services for its £512.7m (€587.8m) pension fund.
The statement said officials are looking to engage in preliminary dialogue with the market, "in advance of preparing to embark on a procurement process on behalf of itself and a number of other London local authorities, to set up a framework agreement to provide pension administration services".
A spokeswoman for Hammersmith & Fulham said the council is looking to set up a framework agreement that "other London boroughs can opt into and join". In this way, one provider could potentially perform administration services across a number of different funds and in turn reduce costs to the councils.
That said, Hammersmith has no indication of how many other local authorities in London may take part in the agreement, which would be expected to cost between £500,000 and £5m and last for a period of four years.
Pension administration services are currently provided to Hammersmith by the LPFA, which in addition to its own pension fund offers third-party administration services to a number of local authorities in London.
Ahead of the expiry of its contract with the LPFA, Hammersmith is calling for potential applicants for the framework agreement to contact the council by 4 February 2010. The The awards procedures are then expected to begin on 15 March.
The consolidation of pension administration has previously been suggested as one way for the Local Government Pension Scheme (LGPS) as a whole to cut costs and become more sustainable. Howeve,r pension experts have noted the practicalities of such a move requires further discussion. (See earlier IPE articles: Merging LGPS 'impossible' for governance reasons and UK government 'acting too slowly' on LGPS)
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