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Gwynedd Pension Fund

Pooling of Investments

At the Summer Budget 2015 it was announced that the Government will work with Local Government Pension Scheme (LGPS) administering authorities to reform how LGPS investments are managed.

The LGPS is one of the largest public sector pension schemes in the UK. It is a nationwide pension scheme for people working in local government or working for other types of employer participating in the scheme. In England and Wales the LGPS is currently organised as 91 funds, each with an administering authority responsible for the management of its assets and liabilities and the administration and payment of pensions to its local members.

The Government want the 91 LGPS pension funds to pool their assets into around six investment pools in an effort to drive down investment costs and enable funds to develop the capacity and capability to become world leaders in infrastructure investment and help drive growth in the UK economy.

The expectation is that the new investment pools will begin to be used for collective investment from April 2018 onwards.

Gwynedd Pension Fund has been working on collaboration with the seven other local government pension funds in Wales for several years on a number of issues and is progressing towards an investment pool for Wales.

The current position in Wales

The All Wales Investment Pool proposal was submitted to the Department for Communities and Local Government in July 2016. Subsequently, a delegation from the Wales LGPS funds met the Minister on 16 November 2016  where the proposal and progress of the pool to date was discussed.   The Minister formally approved the All Wales Investment Pool on 23 November 2016. Marcus Jones MP wrote:

"the Welsh funds have a long history of cooperation, and are working together successfully to develop the all Wales pool.  I congratulate you on the exceptionally low fee for the passive equities portfolio of all Welsh funds which you have already secured.  I was also glad to note your ambition to increase infrastructure investment.  Given your strong partnership, and the special position of Wales...... I am therefore pleased to confirm that I am content for you to proceed as set out in your final proposal."  

Officers and pension fund chairs are working towards establishing a Collective Investment Vehicle by the target date of 1 April 2018.

The submission by the Wales Pool to the Department for Communities and Local Government (DCLG) and Marcus Jones MP's reply can be found in the Attachments section below.

Attachments

Wales Pool Submission to the DCLG

Marcus Jones MP Letter