Pooling of investments
The LGPS is managed by a number of separate pension funds across the country, of which the Tyne and Wear Fund is one. Historically, each Fund has been responsible for managing its own investments.
In 2015 the Government announced that LGPS investments would no longer be managed separately by each Fund, but would be merged into smaller investment pools to achieve economies of scale. The objectives of the pooling of assets are:
- Cost savings through economies of scale
- Improved governance
- Improved approach to responsible investment
- Improved ability to invest in infrastructure
Responding to this initiative, the Tyne and Wear Fund joined with eleven other like-minded LGPS funds to set up an investment management company called Border to Coast Pensions Partnership, otherwise known as Border to Coast. The company's objectives include improving investment returns and reducing investment costs.
The transfer of investments to Border to Coast started in 2018 and is expected to take a number of years to complete.
Although the investments of the Fund are being pooled with those of other funds, the administration of pension benefits will remain with the individual funds, including the Tyne and Wear Fund. The value of pension benefits will continue to be set by the LGPS Regulations, and are not affected by investment pooling arrangements.
To help members and Fund Employers an FAQ has been produced by BCPP.
For the latest updates on BCPP please see Border to Coast Partnership News.