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UK roundup: NAPF, LGPS, LPFA, Apollo Global Management

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The National Association of Pension Funds (NAPF) has called on the new UK government to focus on tackling the deficits within the Local Government Pensions Scheme (LGPS) over continuing its policy of cost cutting.

Speaking at the NAPF Local Authority Conference in southwest England, chief executive Joanne Segars said the LGPS community needed to ensure that focus remained on sustainability of the 101 schemes across the UK.

The 89 in England & Wales face potential changes to investment management, as the previous Conservative-led coalition government recommended forcing all listed assets to be invested passively in a collective investment vehicle.

A survey of LGPS NAPF members found that more than one-third (35%) said the new Conservative majority government should focus on tackling deficits – none supported mandatory passive investing.

Segars said the £47bn (€65bn) deficit in the schemes, which have around £200bn in assets, would be the defining issue over the short term.

“We need to cut a good and sensible path through the noise,” she said.

“And it is why we need a clear and consistent way to measure deficits – and why we need to be innovative in developing solutions for managing them.”

In other news, the London Pension Fund Authority (LPFA) has selected Apollo Global Management to invest £150m in alternative credit, including distressed debt, real estate debt, leveraged loans and private lending.

In March, the £4.8bn LGPS scheme created a framework for alternative credit managers for all LGPS schemes to use, appointing Apollo alongside Ares Management, Babson Capital and GSO Capital.

It has now selected Apollo from the framework to manage its push into alternative credit markets after running a second tender process among the four managers.

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