Current Issues in the LGPS
01 Aug 2018 - Estimated reading time: 5 minutes
National Confidence Assessment – end in sight!
The LGPS’ first ever National Confidence Assessment will end on the 10th August. We have been delighted with the take-up so far with over fifty funds agreeing to be part of the assessment. Our intention is to provide each participating fund with their own individual results report plus our findings on the LGPS confidence picture. If your fund has not yet signed up, there is still time to do so and be part of this national assessment. Please contact us if you want to find out more.
£95 exit payment cap – the tortoise & the hare
Maybe the recent spate of Cabinet resignations has reminded Westminster that it was supposed to be introducing an exit payment cap in the public sector? This has been technically on the cards for a few years now – see our previous Summary on the implications for the LGPS. It now appears that MHCLG are minded to introduce standardised factors for early retirement strain costs, purely for the purposes of testing against the £95k cap… but there is a period of voluntary information gathering to take place first, to see what funds currently do. As happens so often with LGPS regulatory changes, the tortoise-like implementation follows long behind the hare-like initial announcement!
Competition and Markets Authority – provisional decisions
The CMA has published a report detailing the decisions it has reached, provisionally, on the basis of its market investigation into the investment consultancy and fiduciary management sector. Further details are provided in our Summary. Although the proposals do not specially focus on the LGPS, a number of the key themes very much apply, such as setting strategic objectives and the need for any reporting measures to reflect the long-term nature of decisions.
Consider your options
With considerable uncertainty on the outlook for future equity market returns, is now the time to adopt an options based “solution” that protects against an equity market sell off, while still participating in market upside? “Maybe” is the answer, but like all investments, it is important to understand such solutions in more detail and consider how they might fit with your objectives and governance. We discuss this more in the following Summary.
Taking control of their LGPS participation was a key theme of the recent seminars we held for academies. Understanding the areas where academies do, or do not, have control is essential for successful liaison with their local funds. As the number of MATs around the country are growing, we discussed some issues particularly important for MATs: around the way they are administered by each fund, some considerations when a school moves between MATs and some things to think about for MATs that would like to consolidate into a single fund. We understand the challenges faced by funds and academies, and we’d encourage engagement and regular dialogue between academies and the administering authority to help best manage and understand LGPS participation.
Hot & bothered?
During a summer heatwave what could be more appropriate than an analysis of how climate change and resource constraints might impact UK longevity? The report highlights three climate change longevity scenarios which will be relevant to all schemes including the LGPS. If you would like to discuss this in more detail please contact us.
Corporate Social Responsibility Report 2017/18
At Hymans Robertson, our corporate social responsibility (CSR) strategy focuses on our approach to our Communities, our People and our Environment. It is integral to who we are as a firm. Our Corporate Social Responsibility Report for 2017/18 is our first review of all our CSR activity. The report shows the progress we have made in our focus areas, and in our goals, as well as setting out some of our targets for the year ahead. If you have any comments or questions about the report please let us know.
Breaking news: Exit credit tax position
It appears this has now been clarified by HMRC and there will be no tax charge on the exit credit payment by the Fund, and no requirement for the ‘scheme administrator’ of the pension scheme to report the payment to HMRC. This may well not be the last we hear of how such payments need to be treated.