UK considering national investment vehicle for LGPS

first_imgThe launch of a single national investment vehicle for nearly 90 local authority funds in England and Wales is one of three cost-saving measures being examined by the UK government.According to a tender launched by the Department for Communities and Local Government (DCLG) earlier this month, it is seeking to hire an actuarial or investment consultancy to offer a “robust analysis of the costs and benefits associated with structural reform” of the Local Government Pension Schemes (LGPS).Noting the £500m (€590m) annually spent by the funds on asset management and administration, the department said the study would examine the benefits of a single investment vehicle for all LGPS in the region.It will also look at two further options – launching several vehicles with “closely aligned” investment approaches, or the potential for merging the existing funds with each other. It follows a recently concluded consultation on the future shape of the pillar in which DCLG made clear it was not “wedded” to the current number of funds – 89 in England and Wales.In the tender notice, DCLG added: “Building on this initial call for evidence, the Cabinet Office and the Department for Communities and Local Government would like to commission further advice to explore the savings that might be realised by collaboration.“The purpose of this research is to provide government with robust analysis of the costs and benefits associated with structural reform of the Local Government Pension Scheme, to develop a roadmap to implementation and to consider how that reform might be applied to other funded public service pension arrangements.”The tender is now closed to applicants.Welsh local authorities have previously considered pooling assets in a single investment vehicle, and a similar approach was also proposed by the Wandsworth Borough Council Pension Fund.Several neighbouring local authorities in England have, meanwhile, considered merging their pension funds, although the proposal was made as part of an overall merger of the three councils.last_img read more

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Danish fund sees UK court back €700m case against failed Portuguese bank

first_imgAfter its collapse, the bank was bailed out by the Banco de Portugal (BDP), the country’s central bank.Assets and senior debt were transferred to NB – the so-called ‘good bank’ – leaving other items in BES, now the ‘bad bank’, to be liquidated.However, on 22 December 2014, the BDP announced it was reversing the transfer of the loan since it regarded the original deal as a related party transaction, because of GS’s small shareholding in BES.In its application to the Commercial Court, NB had contended that an English court could not hear the case, because – among other reasons – this “trespasses on the administrative acts of a foreign executive body”, in reference to the BDP.However, in a written judgment, Mr Justice Hamblen said he was satisfied the lawsuit was within the scope of the EU Judgments Regulation, and therefore the English court had jurisdiction to hear the case.He added: “I conclude that the claimants have the better of the argument that NB became a party to the facility agreement as a result of the August decision [to transfer assets and debt to NB] and that this is sufficient to found jurisdiction under Article 25 of the Judgments Regulation.”The claimants launched their suit earlier this year. A British court has backed attempts by a Danish pension fund to reclaim losses from a loan extended to Banco Espirito Santo (BES), the failed Portuguese bank.Novo Banco (NB), the successor to BES, is being sued by a group of investors including TDC Pension, the Danish telecommunications pension scheme, and the New Zealand Superannuation Fund (NZSF), for the recovery of a $785m (€701m) loan made to BES before it went under last August.The money was lent by Oak Finance Luxembourg, a vehicle set up by Goldman Sachs (GS), which raised funds from investors, issuing them with fixed rate notes.The loan was arranged under a facility agreement between BES and Oak Finance. This agreement contained an express choice of English law and English jurisdiction.last_img read more

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EIOPA responds as PensionsEurope echoes common framework fears

first_imgPensionsEurope has called for a “period of legislative calm” in a follow-up position paper on EIOPA’s proposal for a common framework for risk management, with the association saying it was “strongly opposed” to EIOPA’s call for national authorities to take regulatory action based on the common framework tool.The European Insurance and Occupational Pensions Authority (EIOPA) issued its proposal in April.Reactions from the industry in the immediate wake of the announcement were positive about EIOPA’s decision to drop its work on solvency but negative on the proposal for a common framework, to be used for risk assessment and transparency for defined benefit (DB) pension schemes.PensionsEurope issued a brief statement at the time, saying the common framework was “costly” and “unnecessary” and that it would comment in more detail at a later stage.  Since then, the German occupational pensions association, aba, has raised concerns about EIOPA’s proposal, in particular its fear that the supervisory authority could yet make a move that would effectively lead to solvency requirements for Institutions for Occupational Retirement Provision (IORPs) – the frequently made holistic-balance-sheet-through-the-back-door argument.This is based on EIOPA’s having called for national supervisors to be provided with “sufficient powers to act in response to the conclusions of the standardised risk assessment”.PensionsEurope’s latest reaction to EIOPA’s proposal appears to echo aba’s argument.Janwillem Bouma, chair of the European pension fund association, said IORP II, the new EU occupational pensions legislation, “contains a thorough framework for pension funds’ future risk management and assessment” and that IORPs regularly carry out “essential” risk management processes.“Now it is time for a period of legislative calm in order that pension funds can concentrate on delivering adequate, safe and affordable pensions and retirement provisions for their members and beneficiaries,” said Bouma.Matti Leppäla, secretary general of PensionsEurope, welcomed EIOPA’s decision to “refrain” from introducing EU-level harmonised funding or capital requirements, as this would have “significant negative impacts”.He added: “We are therefore strongly opposed to requiring national competent authorities to act upon the results derived from a risk management and transparency tool using the common framework because this would be introducing a holistic balance sheet through the back door.”Leppäla said the IORP II Directive “stresses that the further development at the EU level of solvency models, such as the HBS, is not realistic in practical terms and not effective in terms of costs and benefits, particularly given the diversity of IORPs within and across member states”.This means no quantitative capital requirements should be developed for IORPs at the EU level, he said, noting that they could make employers less willing to provide occupational pension schemes.“PensionsEurope calls for policymakers and EIOPA to respect this,” he said.EIOPA: ‘Further work can be done’Asked whether EIOPA planned to formulate guidelines or rules for Article 29 of IORP II that would bind national authorities to act on the results of a risk management using the common framework, a spokesperson at the authority told IPE it was “convinced” the recommendations it made in its April 2016 opinion paper would “ensure a consistent application of the principle of market-consistency”.“Guidance for establishing the common framework should, as far as possible, be provided at European level,” added the spokesperson.“However, further work can be done to develop additional simplifications and European-wide guidance that facilitate the proportionate application of the common framework.”last_img read more

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French private sector pension scheme deficit falls to €1.2bn

first_imgThe deficit in France’s mandatory private sector pension schemes amounted to €1.2bn in 2017, nearly €1bn less than the year before.In 2016 the overall deficit was €2.2bn.Agirc and Arrco said the technical deficit for 2017 was €3.5bn, down from €4.2bn the year before.Returns of nearly €1.5bn generated by invested reserves were offset against the technical deficit. An exceptional gain of almost €900m was also booked in 2017, mainly as a result of the schemes taking over legal ownership of real estate assets from La Foncière Logement, a public housing association. The agreement was signed in April 2017, with a €6.2bn portfolio of 30,000 housing units the first assets to be transferred.  The schemes took in €65bn of contributions last year and paid out €73.8bn in benefits, a slight increase of 0.5% on 2016. The schemes are unfunded.The results put Agirc and Arrco slightly ahead of the trajectory agreed by the social partners, the schemes said in a statement. Agirc and Arrco are the compulsory pension schemes for the French private sector, with Agirc covering managerial staff and executives and Arrco covering employees. As of the end of last year 1.6m employers and 18m employees were paying contributions to the schemes.According to a report released in January, in 2014 Arrco counted 40.5m members, meaning that almost 96% of individuals born in France and between the ages of 24 and 59 had at one point contributed to the scheme.The two schemes are separate for now, but are due to merge under reforms agreed in 2015 as part of an effort to tackle the funding shortfall.last_img read more

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Charity Commission seeks industry views on RI

first_imgThe UK’s Charity Commission is seeking views on responsible investing by charities, to find out how they can align their investments with their charitable aims.A blog on the regulator’s website by Sian Hawkrigg, strategic policy advisor at the Commission, announced the initiative, saying the regulator aims to discover the barriers to more widespread responsible investments, as well as how to support trustees investing in a way that reflects a charity’s purpose and values, while achieving good returns.Hawkrigg said: “We want to ensure charities are aware of what they can do to understand their options when it comes to investing responsibly, and if necessary, equip them with tools to help make thoughtfully considered decisions.”She added that the initiative had come about because of the public’s increasing demand for transparency from the charity sector, and because trustees needed to consider the long-term financial sustainability of their investments. Trustees generally have a legal duty to seek good risk-adjusted financial returns from the way in which they invest their charity’s assets, but they can, under certain circumstances, take ethical and other non-financial considerations into account when deciding how to invest.These circumstances include where there is a conflict with the charity’s purposes, or there is no risk of significant financial detriment.According to Luke Fletcher, a partner at law firm Bates Wells, investment matters are often delegated to a charity’s investment committee, without a review of the investment policy itself or the terms of reference of the investment committee, sometimes for many years.Fletcher said: “This means there can be a disconnect between the grant-making activities of foundations – where impacts are evaluated – and the investment activity itself – where the impacts often receive relatively little scrutiny.”“There can be a disconnect between the grant-making activities of foundations – where impacts are evaluated – and the investment activity itself – where the impacts often receive relatively little scrutiny.”Luke Fletcher, partner at law firm Bates WellsAnd he continued: “There is also often a perception that the duty of trustees is simply to ‘maximise’ financial returns from investments, when the law concerning charity investment is actually quite different, especially where investments conflict with the charitable objects of a charity or otherwise place its work or reputation at risk.”Last March, a coalition of UK charities sent an open letter to the Charity Commission and the Attorney General, seeking a landmark ruling on whether charities should ensure their investments support their goals and their duty to provide public benefit.They also asked for specific legal guidance on whether charities should adopt investment strategies aligned with the Paris Agreement’s aim of limiting global warming to 1.5°C above pre-industrial levels.The coalition – which includes the Royal Society for the Protection of Birds and the Joseph Rowntree Charitable Trust – has a membership of around 50 foundations responsible for £3bn (€3.6bn) worth of assets.Fletcher welcomed the Charity Commission invitation, but said: “Ideally, we would have a court judgment which affirms the view that the development of a charity’s investment policies should be informed by its purposes and values, and which clarifies how this approach relates to traditional financial investment.”Such a judgement, he said, would help resolve the question of what happens where there are trade-offs or compromises between fidelity to purpose, and financial returns.Fletcher also urged the specific mention and treatment of climate change to be included in future guidance.When asked whether this would develop into a formal consultation, a Charity Commission spokeswoman said: “We are engaging with, and seeking views from, interested parties in order to inform our next steps in this new programme of work. At this stage we do not know what the outcome of this will be, so we cannot say yet whether there will be a need for a formal consultation.”The Commission will be seeking views until 31 March 2020. Contributions should be e-mailed to [email protected]last_img read more

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‘Game-changer’ COVID-19 demands pension policy urgency, says Allianz

first_imgAnd they warned: “Against the background of demographic change, time to fix the pension systems, in order to guarantee not only intra- but also inter- generational equity, is running out for all countries.”The API was last published four years ago. Since then, its methodology has changed, combining the indices for sustainability and adequacy, and including demographic and fiscal prerequisites. But this proved more difficult than expected, said Allianz.The index, covering 70 countries, is based on three sub-indices: demographic change and the public financial situation (financial leeway); sustainability; and adequacy (providing a sufficient standard of living in old age).It takes into account 30 parameters, rated on a scale of 1 to 7, with 1 being the best grade. The results are based on the latest available data as of March 2020.While there are similarities with the annual Melbourne Mercer Global Pension Index (MMGPI), Allianz said its API places a greater focus on demographics, while the MMGPI puts greater weight on administration and regulation.Meanwhile, the current pandemic has now pushed up the need for pension reform several notches, said Holzhausen.Holzhausen told IPE: “COVID-19 is a game changer. Before, pension reform complacency could at least partially be explained by benign economic and fiscal conditions. Those times are gone for good, thanks to the devastating effect of COVID-19 on public debt. Pension policy has acquired a new urgency.”But he added that the political landscape after the pandemic might open up new opportunities for – even radical – reforms.He told IPE: “COVID-19 showed that rapid, formerly unthinkable change is possible. It would be a pity if the crisis is not used for far-reaching changes, but wasted.”And he added: “It’s all about the balance, between adequacy and sustainability, between social security and individual efforts, between younger and older generations. That’s why we think that an open public debate is of the essence.”He told IPE: “Our rankings reveal that demography is not destiny. Even countries with dismal prospects – like China, Japan or Germany – can have decent pension systems, if the relevant parameters are right.”He concluded: “Pension policy is not rocket science, it requires ‘only’ bold policymaking.”The next API report is expected to be published in two years’ time. Meanwhile, Allianz intends to publish regional editions, with more detailed analysis of the countries in focus.The full report, Allianz Global Pension Report 2020: The Silver Swan, can be found here.To read the digital edition of IPE’s latest magazine click here. Sweden, Belgium and Denmark are the three highest-ranking countries worldwide in terms of the sustainability and adequacy of their pension systems, according to the latest Allianz Pension Index (API).The Netherlands, Norway and Bulgaria also featured in the top 10. Among other European countries, the UK ranked 16, Italy 18 and Germany 26, while France came 51st.However, with demographic change set to accelerate within the next few decades – for instance, the dependency ratio will reach 51% in Western Europe by 2050 – the study said that pensions policy globally had been eclipsed by other topics, particularly climate change.The report’s authors – Arne Holzhausen, head of wealth, insurance and trend research, and Michaela Grimm, senior economist, both at Allianz Global Investors – said: “’Ageing’ has vanished from the headlines in recent years, and so has the pension reform assiduity of many governments. Instead, pension reforms have been postponed, already adopted measures revoked, or new and costly benefits introduced.”last_img read more

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These greater Brisbane suburbs have a median house price of more than one million dollars. See what that buys you

first_img112 Esky Rd, PallaraIt is listed through Brandy Mandic and Char Gribble of Raine & Horne. 30 Turner Ave, New Farm.Outdoors is a patio and outdoor kitchen and a heated swimming pool with built-in spa jets, and the lower level has a three-car garage. It is listed through Sarah Hackett of Place – Bulimba.The high median house price at Pallara is indicative of the number of large blocks being sold for future housing development. 300 Kent St, New Farm. Picture: realetate.com.auThe value of greater Brisbane’s property market is continuing to grow with new figures revealing there are now 24 suburbs with a median house price of more than $1 million.The highest is Teneriffe which was the first suburb to breach the $2 million median market and now has a median house price of $2.2 million.It is followed by neighbouring suburb New Farm which has a median house price of $1.725 million. 300 Kent St, New Farm. Picture: realetate.com.auYou’ll need to travel a little further for the suburb with the third highest median house price – Pallara, which currently sits at $1.51 million.In Teneriffe, $1.785 million will buy you a restored, three-bedroom, former worker’s cottage at 300 Kent Street. center_img More from newsNew apartments released at idyllic retirement community Samford Grove Presented by Parks and wildlife the new lust-haves post coronavirus18 hours ago300 Kent St, New Farm. Picture: realetate.com.auThe home has VJ walls, the internal rooms have been reconfigured and original hoop pine floorboards uncovered.New Guinea rosewood, custom built-in joinery is used throughout the home. There are two freestanding “pods’’ underneath one of which houses the laundry and bathroom, the other a secondary kitchen which leads to a two-tiered entertainment deck with built-in concrete seating.It is listed through Karla Lynch and Matt Lancashire of Ray White New Farm.At New Farm, a four-bedroom home at 30 Turner Ave is listed for sale. The contemporary home has a 2000-plus, climate-controlled wine cellar with remote controlled doors, home office, powder room and guest bedroom. 30 Turner Ave, New Farm.A three-bedroom home at 112 Esky Rd on 14,780sq m of land is scheduled for auction on July 14.The property is fully fenced and is described as ideal for self-sustainable living. There are already coffee trees and established fruit trees and a chook pen and run. The property has a total of 45,000 litre rainwater tanks plus town water.Inside the home are open living areas, a wood heater and ducted airconditioning throughout. The kitchen has a built-in pantry and a breakfast bar.last_img read more

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Residents relocate after feeling ‘under attack’ in their own homes

first_img Darius Boyd lists first home ever bought Regional director at REIQ Damien Keyes said crime is a well-known occurrence in Townsville, and is on the minds of buyers. “I think unfortunately crime in Townsville is that wide spread now that there’s not any one suburb where it’s particularly more isolated than another,” Mr Keyes said.“It is something that definitely does come up with buyers, but it doesn’t seem to stop them buying — they will gravitate to areas that accommodate their strongest needs (school, work etc.). “They also have budget limitations.” Inspector Sean Dugger said he could not pinpoint any specific Townsville suburbs where crime is more prevalent but said local police have a range of tactics in place to combat crime. “We are intelligence driven, so we have adopted a number of strategies to address property crime in conjunction with other government agencies — that can be everything from high visibility patrolling to allocation of resources in certain areas,” Mr Dugger said.“We also do a fair bit of work in the preventive space, and have a number of other strategies with the view of disrupting crime.” Interest rate to drop below 1 percent, Big Four bank predicts Stephen Lane in 2017 after he was assaulted in his Rosslea driveway. Picture: Zak SimmondsChrisy Crow who has recently bought a property in Aitkenvale and was broken into just over three weeks ago at her temporary residence in the same suburb, said she and her husband are no longer planning on living in the Aitkenvale after the incident. “This has made us think twice about where we’ve purchased a property — In talking to the police, they said the whole suburb of Aitkenvale was hit that same night and they were just snowed under with reports,” Ms Crow said. “We got the house for a very good price so we’re not too put out … but it has definitely made us not want to stay here — we’re going to renovate it, rent it out and we’ll move somewhere safer like North Ward.”More from news01:21Buyer demand explodes in Townsville’s 2019 flood-affected suburbs12 Sep 202001:21‘Giant surge’ in new home sales lifts Townsville property market10 Sep 2020Head of economics at James Cook University, Dr Riccardo Welters said research in parts of the country has shown property values are affected in areas where there are high crime rates against people. “looking at research that has been done in Sydney and Victoria, it’s found that crime against property does not affect property values but crime against the person does,” Mr Welters said.MORE NEWS: Crunch time for election property promises for first home buyerscenter_img Stephen Lane says he is happier living in Douglas since relocating from Rosslea after being a victim of multiple criminal attacks. Photo: Alix SweeneyCrime is currently a hot-topic on the minds of many residents in Townsville, and in some areas they are being forced to relocate to avoid it.Douglas resident Stephen Lane who moved from the suburb of Rosslea after being a victim of multiple criminal incidents including a brutal bashing in 2017, has told of feeling forced-out of the suburb. Mr Lane said the assault was the final straw, and that he still suffers with PTSD from the attacks. “I’ve taken a fair financial hit moving to this area but I had to do it for my mental wellbeing, I couldn’t handle being in a suburb where we were just under attack the whole time,” Mr Lane said.While the move to Douglas has made him feel safer, Mr Lane said he still witnesses crime almost everyday and is planning to move from Townsville completely because of it. “I plan to finish my degree and leave Townsville with absolute certainty — the crime levels here are just so high.”“I’ve been no different to a lot of resident’s, it’s very much in your face these days.” MORE IN REAL ESTATE NEWSlast_img read more

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Zohr field to make Egypt energy exporter

first_imgThe Egyptian Prime Minister Sherif Ismail met on Tuesday with Eni’s CEO Claudio Descalzi to discuss Eni’s giant offshore gas project – Zohr.According to Eni, the two focused on the future of the Zohr “mega field” and the positive impact it will have on the national energy economy, with CEO Claudio Descalzi outlining the progress being made with the rapid development of the project.Thanks to the significant operational synergies that Eni has been able to exploit with its facilities in the area, the development of Zohr is 80% complete less than two years after the discovery was made, a record in the oil industry, the Italian company said.“With a potential of 850 billion cubic meters of gas in place, not only will Zohr be able to satisfy almost all of the total domestic gas demand for the coming decades, it will also allow Egypt to return to being a net energy exporter,” Eni said.Eni is the main producer in the country with production reaching approximately 230,000 barrels of oil equivalent per day. In its recent quarterly report, Eni confirmed the production from the Zohr field would begin at the end of 2017.Zohr was discovered by Eni in August of 2015 and, with a total potential of 850 billion cubic meters of gas in place, is the largest natural gas field ever discovered in the Mediterranean.last_img read more

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Cosco delivers research ship to Guangzhou Marine Geological Survey

first_imgChina’s Cosco shipyard has delivered a research vessel to Guangzhou Marine Geological Survey.According to Cosco, the vessel named Hai Yang Di Zhi Shi Hao was delivered on November 18, 2017.The vessel measures 7.6 meters high, 15.4 meters wide and 75.8 meters long.The client, Guangzhou Marine Geological Survey (GMGS), is an entity controlled by China Geological Survey, Ministry of Land and Resources.last_img

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