Robber Reeves Wants To Amalgate 86 Council Pension Funds.

Elegran

Two questions - what safeguards are currently in place to make sure that pension pots held in individual LAs don't vanish if the LA goes bust and needs to appropriate the money? and are the same safeguards or even stronger ones to be put in place to protect the pension pots in these larger mega-pots?

If the answers to these questions are satisfactory, I don't see why some posters are so against the idea. It sounds sensible to me to get the advantages of investing as larger chunks and earning better interest rates, so long as the risks of losing those same bigger chunks (either by market fluctuations or by meddling) have been considered and protected against.

Good questions Elegran. There is some cause for concern when you can read on GN and other media about LAs going bankrupt.

Protection against meddling-yes very important.
Fluctuations?
Timescales in investments are also a difficulty.

Investments are tricky. Would LAs go for a low risk, ‘safer’ option, where the investments make less money than those in ‘moderate risk’ or higher risk’ but are less likely to lose money?

How much experience with the administration have? Would they personally lose on a scale equivalent to any losses their choice of investment might make?

When you consider the number of company schemes that have gone down, when the company has gone bust and pension funds have not received all they were due, why anyone thinks that ordinary pension funds are so safe, I cannot thing.

There was Phillip Greens Arcadia empire, BHS. Carillion, Allders Stores, Austen Reed, Country Casuals, Bernard Matthews and hundreds more, with known and unknown names.

The government of the day set up the Pension Protection Fund to try to protect pensioners after the Maxwell empire collapsed. My uncle's (by marriage) brother worked for over 30 years for a big company of printers taken over by Maxwell. For over 30 years he paid into a pension schem that enabled him and his wife to retire in modest comfort. Then one day he got a check for £1,500 and told that was his share of the asset value of the fund, thank you and good by. From then on his income was state pension only. He was 70.

So do not ssuggest that everyone is safe if things stay as they are and unsafe if they change

A few facts from the LGPS website might help.

"The facts

The LGPS is one of the largest pension schemes in the UK. It is a defined benefit pension scheme which means your pension is based on your salary and how long you pay into the Scheme. Your pension is not affected by how well investments perform. The LGPS provides you with a secure and guaranteed income every year when you stop working.

The figures

Across England and Wales the LGPS currently has 6.1 million members:

2 million people are currently paying into the LGPS
1.9 million people are being paid a pension from the LGPS
2.4 million have a pension with the LGPS that they have not taken yet
Over 18,000 employers participate in the LGPS.

In March 2022, the market value of the LGPS was £361 billion."

Hope this helps.

MissInterpreted

vegansrock

I think it’s any excuse to bash the government.

Absolutely especially considering the Tories were already looking at doing something similar.

Maybe,but they are not in GOV now, are they. Just think of the shouts if Tories had got this idea from Labour.
Seeing as this current Gov are more interested in taking money from working folk, including farmers, I wouldn't trust them to make a success of this at all.

Freya5

MissInterpreted

vegansrock

I think it’s any excuse to bash the government.

Absolutely especially considering the Tories were already looking at doing something similar.

Maybe,but they are not in GOV now, are they. Just think of the shouts if Tories had got this idea from Labour.
Seeing as this current Gov are more interested in taking money from working folk, including farmers, I wouldn't trust them to make a success of this at all.

I don't know if you are in the LGPS scheme Freya5, but I have always been very impressed by the communications and efficiency of the scheme. I can't see this changing - it is not a fragmented organisation and I have every confidence that just as it already works to group together LAs for mutual benefit, it will continue to work for all LAs. Obviously if you have detailed information on the possible negative impact of the proposals then it would be helpful to share your insights.

Seems that Britain has announced a new plan to merge many local English and Welsh pension funds into one king-sized “megafund.”

The planned merger will combine 86 pension funds holding about £80 billion of British workers’ retirement savings – the hope is that pooling those funds will allow the “megafund” to unlock new opportunities to make more money for its investors.

“Larger pension schemes can help achieve better outcomes for savers through economies of scale, stronger governance, negotiating power and additional resources,” said one pension policy expert. According to government projections, the combined pension fund is expected to manage assets worth £500 billion by 2030.

Mamie

Freya5

MissInterpreted

vegansrock

I think it’s any excuse to bash the government.

Absolutely especially considering the Tories were already looking at doing something similar.

Maybe,but they are not in GOV now, are they. Just think of the shouts if Tories had got this idea from Labour.
Seeing as this current Gov are more interested in taking money from working folk, including farmers, I wouldn't trust them to make a success of this at all.

I don't know if you are in the LGPS scheme Freya5, but I have always been very impressed by the communications and efficiency of the scheme. I can't see this changing - it is not a fragmented organisation and I have every confidence that just as it already works to group together LAs for mutual benefit, it will continue to work for all LAs. Obviously if you have detailed information on the possible negative impact of the proposals then it would be helpful to share your insights.

No I am not paying into any pension scheme, now. Perhaps you'd like to explained how this is going to protect people's hard won pension Pots. I very well remember my Aunt and brother losing a lot of money, 300,00 in the last pension scam in late 80s. There will need to be extensive guarantees, to ensure the Gov dont do this at the expense of peoples pensions.

Freya
There will need to be extensive guarantees, to ensure the Gov don't do this at the expense of peoples pensions.

I think that’s the real concern, regardless of who is in power or who has the idea.

Freya5

Mamie

Freya5

MissInterpreted

vegansrock

I think it’s any excuse to bash the government.

Absolutely especially considering the Tories were already looking at doing something similar.

Maybe,but they are not in GOV now, are they. Just think of the shouts if Tories had got this idea from Labour.
Seeing as this current Gov are more interested in taking money from working folk, including farmers, I wouldn't trust them to make a success of this at all.

I don't know if you are in the LGPS scheme Freya5, but I have always been very impressed by the communications and efficiency of the scheme. I can't see this changing - it is not a fragmented organisation and I have every confidence that just as it already works to group together LAs for mutual benefit, it will continue to work for all LAs. Obviously if you have detailed information on the possible negative impact of the proposals then it would be helpful to share your insights.

No I am not paying into any pension scheme, now. Perhaps you'd like to explained how this is going to protect people's hard won pension Pots. I very well remember my Aunt and brother losing a lot of money, 300,00 in the last pension scam in late 80s. There will need to be extensive guarantees, to ensure the Gov dont do this at the expense of peoples pensions.

I have been drawing my LGPS pension for fifteen years Freya5. This is the Local Government scheme, long established, respected and very efficient. I can only draw conclusions from my direct experience and I see no need to be concerned about unevidenced, politically motivated scaremongering.

But those schemes that lost people's money were private not local government ones.
Why should amalgamating small LG schemes affect private pensions.

Where will those with the expertise to manage funds like that come from?

Mollygo

Where will those with the expertise to manage funds like that come from?

Hopefully not from Government cronies.
The GMPF seems to be well managed, maybe look at the best managers from the existing model and recruit them to the new model.

I think there is some misunderstanding as to how these schemes are run.

You’ve hit the nail on the head karmalady. I haven’t had the kahunas to say that, but you are so right. So much of it smacks of communism. All the rights we absentmindedly ‘give away’ or are pushed roughshod into, like this one, are rights and choices we will never get back.

This is from the LGPS website and explains how the scheme is run:
www.lgpsmember.org/about-the-lgps/how-the-lgps-is-run/
The whole website has clear, factual information.
The Border to Coast Pensions Partnership, based in Leeds, is currently the largest group within the LGPS.

welbeck

But those schemes that lost people's money were private not local government ones.
Why should amalgamating small LG schemes affect private pensions.

That's OK then, they were private. That doesnt matter !!!!

welbeck

Isn't it more cost effective to have larger funds.
Less spent on admin so the funds should be more productive thus benefitting the pensioners.
Are the complainants above currently in receipt of LA pensions?
If not why does it bother them so much?

Because they may well have family members, like I have, who may well be affected if this goes , well better not say it on here, but ends with "up".

Is it not the case that any shortfall in the pensions payable caused by inadequate investment income has to be made up to the benefit of the LG pensioners from Council Tax receipts? Has this happened so far? Would Reeves' plan increase that risk?

Remember Robert Maxwell? Keep your mits off our pensions! Leave it to the people who are trained professionals! Rachael you are not one of them!

Grantanow

Is it not the case that any shortfall in the pensions payable caused by inadequate investment income has to be made up to the benefit of the LG pensioners from Council Tax receipts? Has this happened so far? Would Reeves' plan increase that risk?

Who knows but I do remember when the LGPS I was in was so flush with money in the 80s that the council was allowed to avoid some (or maybe all) their contributions for a year. Wish I'd been allowed to have a free year.

welbeck

Isn't it more cost effective to have larger funds.
Less spent on admin so the funds should be more productive thus benefitting the pensioners.
Are the complainants above currently in receipt of LA pensions?
If not why does it bother them so much?

Isn't it nice that so many people are concerned for those of us in the LGPS. I mean we normally get abuse for our pensions and now everyone is worried for us.

love0c

Remember Robert Maxwell? Keep your mits off our pensions! Leave it to the people who are trained professionals! Rachael you are not one of them!

Rachel Reevesmerely intends to form bigger schemes with larger funds. They will still be managed by trained professionals.

Hereis a list of all the pension schems that have had to be vested in the government Pension Protection Sheme, because companies failed and pension schemes had not been properly invested or funded, hundreds of them.

Comsider them all and say why you think these small schemes with doubtful investments would be worse off in larger schemes with serious heavy weight pension trustees that really understand their job.

Yet another inflammatory, ill informed thread started for political reasons. I do wish people would do just a little research. Obviously we all have our opinions, but to see everything that this new administration suggests as some part of a sinister, communist conspiracy doesn't lead to intelligent debate.

Ilovecheese

Mollygo

Where will those with the expertise to manage funds like that come from?

Hopefully not from Government cronies.
The GMPF seems to be well managed, maybe look at the best managers from the existing model and recruit them to the new model.

This seems to be so obvious I dont now how people carry on grumbling - recruit the best managers from schemes already working well.

I am sorry I forgot to put the link to the long list of failed pensions chemes taken on by the Pension Protection Fund. Here it is www.ppf.co.uk/Schemes . Have a look. I only looked at companies beginning with 'A' There wereover 100 of them.

Mollygo These funds will continue to be managed by the same people who manage them now.

My occupational pension comes from British Gas. It is worth £10 billion and is the seventh largest in the country, Over the 20 or more years I have been drawing my pension it has always managed it well.

All Rachael Reeves wants to do is group smaller pensions with smaller funds and less flexibility into bigger groups with large invested funds to help support investment in the UK and protect the pensions of the members of the saller schemes.