Report of the Director of Finance
Minutes:
The Committee was informed that, on 11 July 2023, the Department for Levelling Up, Housing and Communities (DLUHC) launched a consultation on LGPS investment reforms.
The consultation sought views on the proposals in five key areas:
· Requirement for Funds to have a plan to invest up to 5% of assets to support levelling up in the UK, and to report annually on progress against the plan.
· To revise ISS guidance to require Funds to consider such investments to meet the government’s ambition of a 10% allocation to private equity in the LGPS.
· To make it regulatory to implement the requirements set out in an order made by the Competition and Markets Authority (CMA) in respect of the LGPS.
· To make a technical change to correct an inconsistency in the definition of investment in the LGPS Investment Regulations 2016.
Committee Members were provided with an explanation of the Staffordshire Pension Fund’s proposed draft responses to the 15 questions asked by the consultation, on the five areas highlighted above – these responses were attached at Appendix 1 to the report.
It was noted that the consultation would close on 2 October 2023 and Fund Officers invited feedback from Members on the draft consultation response, prior to its submission to DLUHC.
In response to a question from Councillor Spencer asking how much autonomy the Fund had with regards pooling, whether it was an inevitable process or if a hybrid option could be considered, it was explained that this was a direction of travel the Government expected LGPS Funds to go in. However, it was stated that the Staffordshire view was that a level of flexibility should be given to Funds, rather than a dictated set of rules – and this would be emphasised in the response provided as part of the consultation.
The Chairman of the Committee thanked the Fund Officers for developing a full and thorough response to the consultation.
Resolved: That the response to the Department for Levelling Up, Housing and Communities (DLUHC) consultation on the next steps on investments for the LGPS in England and Wales, provided in Appendix 1, be approved.
Supporting documents: