The Lancashire County Pension Fund Committee (LCPF) and the London Pensions Fund Authority Board (LPFA) have announced a £10 billion asset liability partnership.
Initially to be known as the Lancashire and London Pensions Partnership (LLPP), the pair will act as a pension service organisation and cover all aspects of pension fund management. It will provide joint-managed administration and pooled asset and liability management activities through corporate structures.
The partnership is designed to lead to different types of direct investments, and more of them, as well as reductions in fees, reduce administration cists and more effective liability management.
Both funds will maintain their local accountability with the LCPF Pension Committee and LPFA Board retaining control of key strategic decisions.
CEO of LPFA Susan Martin, said: “We are excited to have taken this unprecedented step of pooling two of the largest pension funds in local government. It is our joint aim to significantly reduce the funds’ combined costs – we estimate by over £32m within five years – and with the benefit of economies of scale, further reduce our respective deficits.”
George Graham, director of LCPF, added: “The partnership will build on the existing expertise across all locations and increase co-operation and collaboration across all aspects of the pension funds, under a strong governance framework. We aim to provide industry-leading standards of administration and so provide our members and employers with efficient and cost-effective services.”
