How we pay for the City (& expensive Red Wine)

I recommend that if you have a funded Pension that you listen to this excellent Radio 4 programme "How You Pay for the City".  

Former fund manager David Pitt- Watson pointed out that excessive charges in the UK compared to  Holland means that the average comparable dutch pension will be 50% more than you would get in the UK.

While the incomparable Mr Colin Meech, UNISON National Officer for Capital Stewardship, thinks that the Local Government Pension Scheme is just being ripped off. He recounted how a colleague who became a fiduciary trustee on a large scheme was shocked to find that the trustee board spent more time being wined (at £100 per bottle!) and dined by fund managers than they spent supervising the scheme. I have heard the same story from that colleague.

It is not just excessive fees by fund managers but also "churn" (excessive buying and selling of stock); stock lending (they lend out your share certificates for a fee), "Custody Banks" (if something is too good to be true...) and "transitional management" (there is a completely shocking story how the Royal Mail Pension fund was cheated and how a judge was told that an untruth was not a lie)

By coincidence we heard similar arguments at the AMNT Summer Conference from Michael Johnson that I posted upon yesterday.

#UNDC13 Capital Stewardship fringe - Wednesday Evening

Picture from UNISON NDC Capital Stewardship fringe "time for members to govern their money" with UNISON national officer Colin Meech, Mo Baines from Greater Manchester Pension Fund (Chaired by NEC Jane Carolan in the middle)

Colin spoke about the need to bring the fund management of the local government pension (LGPS) fund "in-house"and stop being ripped off by City fund managers. He briefed us on the new governance arrangements of the LGPS which will probably come into effect in 2015 (we think).

Mo praised Colin for his work on pensions. He had been the first to point out why schools and hospitals use PFI to fund rebuilding when we have money elsewhere?

The Greater Manchester Pension Fund (GMPF) is worth £10 billion but it only has trade union  observers with no voting rights. The fund is looking into localised investments. It wants to build 240 homes for market rent. If you pay into a pension scheme then the area you live in should also benefit from scheme investments.

Mo said that fish always rot from the top. We should make sure that in the LGPS we change fund management from the top.

My question to both is that UNISON should consider regional networks of LGPS pension reps to encourage and give face to face support to reps? There use to be a national network of LGPS reps who actually sit on pension panels and committees, who could be consulted and give feed back on what they they need to help them carry out their duties.

Colin responded by saying there will be a national consultation forum. He warned us not to underestimate those who feed off your money. Do they want to give this up? There are huge vested interests. The LGPS has high fees plus hidden charges. You could clear pension deficits within 8 years if the LGPS was merged & you cut costs and raise performance.

AMNT Open Meeting March 20th at AXA

Dear Member,

The next AMNT Open Meeting will take place on the afternoon of March 20th at AXA’s London offices, 7 Newgate Street, London, EC1A 7NX. Please do try to come along, though spaces are limited so book your place early to avoid disappointment.

The day will begin at 1100 am with a group training session on one of the latest modules of the Pensions Regulator’s Trustee Toolkit - strategic investment, This follows on from the fund management module we discussed at the last Open Meeting back in December. If you have not already completed these modules, these group discussions are a great way to find your way through.

A buffet lunch will be served at 12.30pm, which members are welcome to attend whether they have been to the morning training session or not.

The main open meeting will take place between 1.30pm and 5.30pm starting with an update of recent AMNT activity, including John Gray’s DB Defence Pack, which is aimed at helping trustees of DB schemes that are faced with closure.

Janice Turner will then go through a recent AMNT submission on smoothing which she has been leading. This will be followed by a presentation by our hosts AXA on how various overseas countries have approached the question of smoothing.

After a break for tea, Colin Meach will give a presentation on recent developments in Public Sector Pensions

Finally, the day will conclude with Robert Inglis, a Project Director from the Financial Reporting Council, explaining Technical Actuarial Standards (TASs), which have been in force for almost three years and getting feedback from the floor.

After the meeting has closed, there will be the usual networking opportunity with drinks provided by our hosts AXA

There are limited places available for this event, so please let us know as soon as possible if you are able to attend. Click on one of the below links and let us know by email, including whether you have any dietary requirements if you plan to attend for the buffet lunch.

- Click here to join the AMNT

 - Click here if you would like to attend for the whole day, including Trustee Toolkit training, lunch, AGM and open meeting.
- Click here if you would like to attend part of the day (please specify which part/s).
- Click here if you are unavailable to attend any session on the day.

 Kind regards,
AMNT Committee