LGPS Central Pool Update Melanie Stokes 1 LGPS Pooling From the - PowerPoint PPT Presentation

LGPS Central Pool Update Melanie Stokes 1

LGPS Pooling From the beginning….. May 2013 May 2014 Nov 2015 July 2016 Investment Reform Criteria Speech by Brandon Lewis Government’s response LGPS Funds’ and Guidance issued. (Local Government “No mergers” detailed response to ‘Backstop’ Investment Minister) opened up the Launch ‘ Opportunities for Criteria Regulation consultation prospect of LGPS collaboration, cost savings and fund mergers efficiencies ’ consultation 1 2 8 3 4 7 5 6 April 2018 Feb 2016 June 2013 July 2015 Start to transition LGPS Funds’ initial ‘Call for Evidence’ Summer Budget assets response to consultation into ‘pool investments to significantly reduce consultation future structure of costs, while maintaining overall LGPS investment performance’ ‘sufficiently ambitious proposals’ 1

Government Criteria A reminder of what it was all about….. 1 2 3 4 Benefits of Strong Reduced An improved scale (at governance costs and capacity and least and excellent capability to £25bn in decision value for invest in assets) making money infrastructure BUT MHCLG formal consultation awaited…. 2

LGPS Central 8 Partner Funds £45bn+ 3

Governance – LGPS Central Local Pensions Administering Pensions Committee Authority Board Joint Shareholder Practitioners’ Forum (Company Committee Advisory Forum matters) (Client matters) Shareholder/Client Company/Regulator LGPS Central (Operator Board Company) Financial Executive Conduct Committee Authorit y Collective Audit Risk & Remuneration Nominations Investmen Compliance Committee Committee t Vehicles Committee Investment Committee 5

Costs And Value For Money The original estimation was for LGPS Central to make cumulative savings of £247.7m by 2034. This estimate is currently being updated. 8

LGPS Central Investment Offering Aim to provide the most appropriate structure to access asset classes across different styles and geographies: ACS LLP Life Policies • Equities • Infrastructure • Equities • Bonds • Private equity • Bonds • Property • Target return LGPS Central will offer the investments needed to deliver the Partner Funds’ investment strategies 12

Progress to Date – since April 2018 7

Progress to Date 7

What is LGPS Central Responsible for? Current Stewardship - All Partner Funds

What is LGPS Central Responsible for? Current Stewardship - Staffordshire 11 LGPS Central Limited is authorised and regulated by the Financial Conduct Authority. Registered in England. Registered No: 10425159. Registered Office: Mander House, Mander Centre, Wolverhampton, WV1 3NB

LGPS Central Global Active Equity Multi Manager Fund 1 LGPS Central 2

What more might LGPS Central do for Staffordshire? Level of Interest Current Pipeline FUND OPERATIONAL FUND FUND INDICATIVE READINESS STRUCTURE INTEREST Global Corporate Jun 2019 ACS CONFIRMED Global Corporate Bonds Bonds -£390m Infrastructure FY 2019/20 SLLP UK Active Equities HIGH - £300m UK Active Equity FY 2019/20 ACS HIGH - Global Factor Based Strategy £250m Multi Asset Credit FY 2019/20 ACS /EMD MEDIUM - Private Equity £10m Global FB Strategy FY 2019/20 ACS Infrastructure UNDER REVIEW Targeted/Absolute FY 2019/20 ACS Property UNDER Return REVIEW Property FY 2019/20 ACS G10 FY 2019/20 ACS 13

Pooling Progress (% of assets managed by LGPS Central by Partner Fund) 14

Our asset pooling journey continues… … any Questions?