THE Lancashire County Pension Fund is set for a pioneering role after it was revealed it could enter into a partnership with a London-based fund next spring.
The red rose fund - which provides pensions for thousands of ex-local government, college and others in the county, was pushed into the national spotlight this week when London Mayor and MP Boris Johnson praised the cost cutting and investment boosting move at the Tory conference in Manchester.
Lancashire County Council’s deputy leader Coun David Borrow said the joined funds would have more than £10bn to invest and acknowledged: “We would be trailblazers in this new world of pension funds.”
The publicity followed Chancellor George Osborne’s announcement of plans to rejuvenate local authority pension schemes, turning the current 89 into half a dozen regionally focused schemes or “British Wealth Funds”.
Mr Osborne said the new schemes would be expected to help boost local economies by investing in infrastructure in their regions.
Coun. Borrow said talks were already well progressed to put Lancashire ahead of the field: ”Lancashire Pension Fund is at a very advanced stage in setting up the joint company with the London Pensions Fund Authority (the old GLC Greater London Council and ILEA, the Inner London Education Authority) to create an investment pool of over £10 billion and to jointly administer their services.”
He said: “This would appear to be in line with Government thinking and if we are successful in launching the new company next spring it will form a basis for other pension funds to join partnerships or to pool their investments.”
Industry commentators have estimated the change will help save millions of pounds in investment manager fees.
The county Pension Fund is worth nearly £5.8bn and includes some 120 county employers ranging from the county, local borough and unitary councils to further and higher education colleges, some charities and other non-profit making organisations.
It is currently funding pensions for 43,211 people, some 55,813 members have deferred their pensions and 54,179 workers are actively paying into it.
But with full details not yet available about the Government’s plans, former MP Coun Borrow said: “Those involved in developing the partnership between Lancashire and London Pension Funds will be having discussions with the Treasury to ensure that our scheme can still go ahead.”
George Graham, Director of Lancashire County Pension Fund, added: “We will have to look closely at what the Chancellor is proposing to understand how our expertise can enable us to play a significant part in a new system.”
The work to join the two funds, based 231 miles apart, has been proceeding for the last year.