Local Government Pension Scheme In England Shows Strong Performance But Government Needs To Tackle The Burden Of Past Deficits
income again outstripped expenditure and investments were good so that the value of the LGPS funds grew by 13% over the last year to over £200bn says GMB.
GMB, the union for public sector workers, commented on new official DCLG statistics published today which show that Local Government Pension Scheme funds in England have had another good year with membership up, market value up and a decade of more cash coming in than going out.
Highlights from the 2014-15 statistics are :
Total expenditure £12.1bn up 6.1% on like for like basis,
Total income £15.2bn up 8.3% on like for like basis,
(Nb one off effects of transfer of some Welsh pensions to an English fund and between funds means like for like is important)
Total employer costs £6.9bn,
Total employee contributions £1.9bn,
Total investment income £3.3bn,
Number of scheme members 4.8m up from 4.6m,
Number of employers participating in LGPS 12,603 of whom 3/4 are publicly funded,
Fund management costs £689m up from £449m (new reporting basis),
Fund admin costs £121m down from £123m
Brian Strutton, GMB National Secretary, said "The 81 LGPS funds in England should be congratulated for another successful year managing the pension pots of nearly five million council workers and former workers.
Cash flow continues a decade of being in surplus with income again outstripping expenditure and investments were good so that the value of the LGPS funds grew by 13% over the last year to over £200bn.
These are very positive results indeed. The new cost reporting format which is partially implemented should make it easier to bear down on any excessive costs.
However the more serious issue is that employers are paying an extra £3bn a year into the scheme to chase past deficits that they are not going to catch.
It's not clear why government wants to change the way these successful funds operate their investments, risking all the good work being done, while ignoring the real problem of the scheme's deficit that is costing employers and ultimately the taxpayer so much.
Costs are now reported on a more transparent basis which will make it easier to control them. However these statistics do not show the full picture because the liabilities are not reported.
The liabilities are estimated to be £40bn higher than the value of the assets and this past deficit burden is costing employers an extra £3bn a year and it's not going away. That's the real problem and the government needs to address it."
Contact: Brian Strutton 07860606137 or Justin Bowden 07710 631351. GMB Press Office 07921 289 880, 07974 251 823