Do you trust Rachel Reeves plans in relation to local government pensions? (6 Viewers)

[MalcSB]

What will Rachel Reeves’s retirement scheme changes mean for pensions?

The chancellor has announced plans to merge local government retirement schemes into eight Canada-style ‘megafunds’

www.theguardian.com

 

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[fernandopartridge]

Why does a sovereign currency issuer need to use pension funds to pay for infrastructure?

 

[fernandopartridge]

The Labour government not only wants more cash for UK projects, but believes UK pensioners should benefit from any returns on investment.

 

[chiefdave]

Sounds a bit like when local authorities were told to invest rather than rely on their budgets.

Does she not realise the value can go down as well as up, who is covering the cost if the projected profits don’t materialise?

 

[Nick]

Sounds a bit like when local authorities were told to invest rather than rely on their budgets.

Does she not realise the value can go down as well as up, who is covering the cost if the projected profits don’t materialise?

Probably tax payers.

 

[Sky Blue M]

This is being made out to be a problem when it really isn't. Peoples individual pensions are not going to be affected.

 

[MalcSB]

This is being made out to be a problem when it really isn't. Peoples individual pensions are not going to be affected.

So if a refuse collector’s pension pot is put in to a Reeves ( the well known fabricator of cvs) inspired investment portfolio and it loses money, how will their pensions be guaranteed?

 

[fernandopartridge]

So if a refuse collector’s pension pot is put in to a Reeves ( the well known fabricator of cvs) inspired investment portfolio and it loses money, how will their pensions be guaranteed?

Presumably it's underwritten by the government in which case I refer back to Do you trust Rachel Reeves plans in relation to local government pensions?

 

[Sky Blue M]

So if a refuse collector’s pension pot is put in to a Reeves ( the well known fabricator of cvs) inspired investment portfolio and it loses money, how will their pensions be guaranteed?

There is no refuse collectors pot in the first place. Individuals do not have "pots" in the LGPS. All this is talking about is going from having 86 funds across the country to 6 - which already started years ago and is now just being accelerated. IE in Coventry, the city council are part of the West Midlands Pension Fund. West Midlands Pension Fund are part of the LGPS central pool but need to ensure that all their total fund is transferred over to LGPS Central as opposed to the gradual transfer that has been in place since 2018

 

[jordan210]

With her CV why would you not trust her.......

 

[StrettoBoy]

With her CV why would you not trust her.......

She has years of experience as an economist in the complaints department of HBOS.

 

[wingy]

Is this really any different to Hunt's using 5%currently for British companies or start ups?
IDK but it feels the same kind of raid!
To be followed by further uses or increases, seems to suggest they don't get offered enough from international bodies or to get extra through these means?
So Blair type Hospital's but return's for these pension pots, think Hunt may have agreed with her on this?

 

[MalcSB]

Is this really any different to Hunt's using 5%currently for British companies or start ups?
IDK but it feels the same kind of raid!
To be followed by further uses or increases, seems to suggest they don't get offered enough from international bodies or to get extra through these means?
So Blair type Hospital's but return's for these pension pots, think Hunt may have agreed with her on this?

I just didn’t trust Chancellors who piss about with personal pensions. Brown devastated the private defined pension with a tax raid. What’s this money going to be invested in and who is going to underwrite it if it goes pear shaped?

 

[Como]

Chicago has more public pension debt than 43 states

Chicago’s pension systems for city workers have $51 billion in debt, so much that they are in worse shape than 43 states. Fixing them requires Chicago’s mayor to push for a change in the Illinois Constitution.

www.illinoispolicy.org

This is Chicago but you will see places like California are worse.

Some things I have noticed and I am sure there is much more is that Politicians are willing to concede pension increases as they will not be around when the time comes to pay.

They assume high rates of return, I have seen 8% mentioned which is of course impossible so the problems cascade.

Very difficult to persuade people to vote for increased taxes to fill the gap.

A ticking time bomb.

 

[wingy]

Where has the money gone if they're looking for our cash,?

 

[duffer]

Personally, I wouldn't trust Reeves as far as I could spit a rat. A cosplay Thatcher, to my mind.

As for the policy itself, I'm not sure, it doesn't sound entirely convincing, but I've not really read around on it yet in fairness...

 

[napolimp]

So if a refuse collector’s pension pot is put in to a Reeves ( the well known fabricator of cvs) inspired investment portfolio and it loses money, how will their pensions be guaranteed?

Am I missing something? The way I understood it was the 86 local government funds are going to be pooled into 8 mega funds, which ultimately just have more spending power. That aside they're going to work the same way, the money in the funds will be invested. How is the risk any greater or smaller than it is at the moment?

By the sounds of it the funds will also save money in investor fees, and be managed by more accomplished fund managers. Not really seeing the downside.

There was also this line in the article: -

"There could also be pushback from the reams of lawyers, asset managers, banks and actuaries who could lose out on hundreds of millions of pounds in annual fees and contracts if funds are consolidated."

Is that a bad thing?

 

[MalcSB]

Am I missing something? The way I understood it was the 86 local government funds are going to be pooled into 8 mega funds, which ultimately just have more spending power. That aside they're going to work the same way, the money in the funds will be invested. How is the risk any greater or smaller than it is at the moment?

By the sounds of it the funds will also save money in investor fees, and be managed by more accomplished fund managers. Not really seeing the downside.

There was also this line in the article: -

"There could also be pushback from the reams of lawyers, asset managers, banks and actuaries who could lose out on hundreds of millions of pounds in annual fees and contracts if funds are consolidated."

Is that a bad thing?

I think it is the inference that such funds will be directed to government pet projects.

This wont be a case in point, but imagine if the investment had been in to that bottomless pit called HS2?

 

[napolimp]

I think it is the inference that such funds will be directed to government pet projects.

This wont be a case in point, but imagine if the investment had been in to that bottomless pit called HS2?

Totally agree, the fund should be managed by an independent fund manager who is able to allocate money for the best interest of the fund investors (pension holders).

 

[fernandopartridge]

Am I missing something? The way I understood it was the 86 local government funds are going to be pooled into 8 mega funds, which ultimately just have more spending power. That aside they're going to work the same way, the money in the funds will be invested. How is the risk any greater or smaller than it is at the moment?

By the sounds of it the funds will also save money in investor fees, and be managed by more accomplished fund managers. Not really seeing the downside.

There was also this line in the article: -

"There could also be pushback from the reams of lawyers, asset managers, banks and actuaries who could lose out on hundreds of millions of pounds in annual fees and contracts if funds are consolidated."

Is that a bad thing?

I think the downside to these arrangements are pension funds being ultimately behind e.g. the inflated property market

 

[RegTheDonk]

This is being made out to be a problem when it really isn't. Peoples individual pensions are not going to be affected.

Recall when Osborne/Cameron came in and made changes. A deal's a deal and they couldn't rip up the formula to that point, but they got rid of the final salary clause from that date. Wonder if Reeves will ultimatley look to make changes and savings somehow.

I guess it'll all be revamped in 5 years time anyway.