Boris on LGPS, LPFA equities move, Angus audit “waste of money”, Dorset partnership
0Boris enters LGPS debate
London mayor Boris Johnson has reignited debate over the Local Government Pension Scheme by calling for wholesale merger of local authority and public sector funds. Using his column in The Telegraph on Sunday, he claimed bringing all funds together would create an investment pool of hundreds of billions of pounds and “suddenly we would be able to direct those vast UK assets to the support of projects that are both socially useful and vital for the economy.” Johnson made no mention of DCLG’s decision in May ruling out forced merger. The department has launched a consultation on common investment vehicles (CIVs) as a means of delivering savings.
LPFA brings £500m fund in-house
A fund of more than half a billion pounds has been brought back in-house by the
London Pension Funds Authority (LPFA) “terminating” the arrangement it had with Newton Investment Management. News of the £528m equity fund emerged in LPFA’s annual report. It said the authority’s board decided in March that Newton, a subsidiary of Bank of New York Mellon, “no longer fitted in our investment strategy… .” The LPFA, with a total of of £4.7bn under management, is to develop its own internally managed “buy and hold” equity strategy to focus on “large global stocks to capture high quality and sustainable investment return.” Newton’s was the fourth largest fund managed for the authority. According to the annual report the largest is Insight Investment Management’s at £1.09bn.
Angus councillor departs “waste of money” audit committee
The scrutiny and audit committee of a Scottish council has been slammed as a “waste of public money” by one of its former members. Cllr David Fairweather resigned from the Angus Council committee telling his local paper, The Courier, that its annual seven meetings were “full of reports which councillors are just asked to note for information.” He insisted the committee meetings could be managed more cheaply. The committee handles corporate governance, risk management and internal audits. Cllr Fairweather is reportedly discussing a “different vision” for the committee’s function.
On the road to better tech
New technologies could be the answer to solving “existing and future transport problems” for local authorities, according to a report from the Institute of Engineering Technology. The report highlights case studies where technology has made a significant difference including smart barcodes (RFID) for disabled crossing users, electric bus programmes and using smart phones and tablets to improve traffic management. Dr Miles Elsden, chief scientist at the Department for Transport, says in the report’s introduction: “Deployed correctly these technologies present an opportunity to revolutionise the UK transport system, much of which is owned and delivered at a local level.”
Welsh council could still stand alone
Welsh county borough Rhondda Cynon Taf may continue as a stand alone authority despite recommendations in a Welsh government review that it should merge with Merthyr Tydfil. Rhondda’s cabinet this week agreed to examine merger options. But council leader Andrew Morgan was quoted in WalesOnline saying an authority the size of Rhondda may argue for a status quo given the economies of scale it already achieves, “but we cannot strongly defend our position if we have not explored what opportunities there may be.” The merger was recommended by the Williams Commission. The Welsh government has backed reducing the nation’s 22 councils to 12. A white paper published in July has mapped a route to voluntary mergers for the authorities.
Stress concerns for officers facing Dorset partnership
Councillors from Weymouth have voiced concerns that officers could be over stretched if the council enters into a partnership that would bring three local authorities under one chief executive. The management committee of Weymouth heard concerns this week as councillors considered a partnership with North Dorset and West Dorset councils. Minutes from the meeting record: “It was considered that staff were already overstretched and concerns about stress levels would lead to further staff losses, and would have an impact on the services being offered by the council.” Weymouth councillor Ian Roebuck, told the management committee that the business case for partnership was failing to consider the effect on staff, according to the Dorset Echo. £600,000 is available from DCLG for 2014/15 as a Transformation Challenge Award for the partnership, but is conditional on the councils having a single senior officer between them. A bid for a further £1.5m for 2015/16 has been recommended to help pay for joining up management, IT, and changes to accommodation.
Funding falls 3.4% for local government in Wales
The collective settlement for local government in Wales has fallen 3.4% year on year, it emerged this week as the Welsh government announced funding arrangements for 2015-16. Leighton Andrews, the minister for public services, blamed the cut on budgets being slashed by the UK government. To soften the blow Andrews introduced a “dampening mechanism” to ensure none of the 22 Welsh councils would see a cut greater than 4.5%. Only Ceredigion will see the maximum reduction. The total settlement is £4.12bn, shrinking by £146m.
