Leicestershire County Council
Pension Fund
Annual General
Meeting
Brian Roberts
Director of Corporate Resources
Scheme Administration





Large increase in number of scheme
employers as schools convert to Academies
Significant decrease in active members
Importance of accurate and timely data to be
provided by employers
Monthly electronic returns been developed
with employers help
Increasing reliance as new scheme beckons
Scheme Administration




Improvements and developments
Website accredited by the plain english
campaign
Member on line services to be introduced
this year
Improved reporting features to be developed
to help data quality
Pension Reform – LGPS 2014




Consultation document issued 21 December.
Closes 8th February 2013
This covers membership, contributions and
benefits.
Further consultation to follow on the
remaining items of new scheme, plus cost
control, governance and councillors’
pensions etc.
Investments




Considerable efforts have been made to diversify
types of asset held over recent years, without
impacting on long-term returns
Appointments since the end of 2011/12 year end
have ‘completed’ the work in progress
A period of relative stability in terms of investment
portfolios is now expected
But manager underperformance will still have to be
dealt with!
Asset types held by the Fund












UK equities
Overseas equities
Property
Targeted return
Global index-linked bonds
Private equity
Commodities
Global Credit
Managed Futures
Infrastructure
Timberland
Currency
Strategic Asset Allocation
Developed Market Equities
Emerging Market Equities
Private Equity
Alternative Assets
35-46%
6-10%
4%
20-30%
(including targeted return, global credit and special opportunities)
Inflation-Linked
5-10%
(including global index-linked bonds, infrastructure and timberland)
Property
Commodities
12.5%
2.5-5%
Investment returns 2011/12


-
-
Fund return +0.7%
Market returns variable, for example;
UK equities +1.4%
European equities -11.4%
UK Property +6.6%
UK Index-Linked +18.1%
UK Government Bonds +14.5%
LOW RISK ASSETS GENERALLY PERFORMED BEST
Medium-term investment returns





Over 5 years, the Fund’s return has been +0.4% p.a.
0.8% below benchmark, due mainly to manager
underperformance within markets
Manager underperformance has brought a number
of dismissals
Return is well below that anticipated by the actuarial
valuation (mainly because equity markets have
performed poorly over this period)
This puts upward pressure onto employer’s
contribution rates
Returns since year end




Equity markets were sharply down until midJune, mainly on fears about Europe
Significant recovery since the low point
Returns from low point to end-of-December
have been good
But still the return for the 9 months is only
around 5%
Outlook for actuarial valuation




Still likely to be upward pressure on employer’s
contribution rates
New slightly cheaper 2014 scheme is unlikely to
change this
But there has been a big improvement since the
position at the end of June
Still almost 3 months to go before valuation date,
and things can change significantly over this
timescale
Annual General Meeting

Any questions ?