The Pensions and Lifetime Savings Association (PLSA) has called for a “significant push” to ensure the regulatory framework of the Local Government Pension Scheme (LGPS) operates in a more joined-up way.
In major research published to coincide with its local authority conference, the PLSA recommended that the “benefits” of a more centralised approach be examined by the LGPS. This could “involve creating a new regulatory body or giving an existing body greater powers”.
According to the report: “As different parts of the LGPS are required to report to a number of disparate bodies, each with their own distinct objectives, this obscures an overall view of the scheme, its purpose, operational requirements and resource limitations.”
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The analysis suggests that the needs of the LGPS can become “deprioritised, missed or misunderstood” as there is not one entity to champion the scheme in discussions with government.
Tiffany Tsang, head of DB, LGPS and investment at the PLSA, said: “Having access to enough resources to secure the right systems and people in place is only part of the answer. Long-term sustainability of the LGPS will also require a significant push to ensure the existing regulatory framework operates in a more joined-up and coherent way.”
As different parts of the LGPS are required to report to a number of disparate bodies, this obscures an overall view of the scheme, its purpose, operational requirements and resource limitations.
Future-proofing the LGPS
Report recommendations are based on the output of a series of roundtable debate ands workshops, plus a survey of LGPS members. The PLSA said it wanted to “future-proof” the LGPS.
Other recommendations include:
- Exploring and sharing best practice in assessing and communicating employer risk and responsibilities early on
- Obtaining a robust and granular understanding of LGPS membership profiles
- Reviewing the PLSA talent management guide and sharing best practice in people management
Rachel Brothwood, chair of the PLSA Local Authority Committee and director of pensions at the West Midlands Pension Fund, said the LGPS had been a “real success story over a challenging decade”.
She added: “It is right that, through this report, we have taken a critical look at the role those tasked with delivering the LGPS can play in ensuring it is well placed to continue to rise to the challenge over the long term.”
The PLSA’s local authority conference is currently taking place in Gloucestershire.
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