I have been appointed to the Hampshire Local Government Pension Scheme (LGPS) Panel. The Hampshire LGPS is the pension fund for Hampshire County Council staff as well as staff from Southampton City Council, Portsmouth City Council and the 15 district councils and various town and parish councils. I have been appointed to represent the two unitary authorities, Southampton and Portsmouth. Employees from Southampton City Council make up 14% of the active members of the fund and Portsmouth 11%.
So far I have been to two meetings, a business meeting on Friday and the fund's Annual General Meeting this morning.
The panel itself is predominantly made up by County Councillors and is chaired by the Leader of Hampshire County Council, Ken Thornber. The panel itself has great deal of industry and business experience and working in the pensions sector myself I have thoroughly enjoyed my experience so far.
Public sectors pensions are very much in the limelight at the moment. The Local Government scheme is widely considered to be an extremely good scheme relative to private occupational pensions. The LGPS has a normal retirement age of 65, although under what is called the 85 rule it is currently possible for some members to retire from age 60. This is in the process of being phased out by Government.
The scheme is known as a funded scheme. This means that the local Councils and Council staff pay into the scheme with the aim of providing sufficient funds to meet people's pensions when they retire. Not all public sector schemes are funded, and instead pensioners paid out of general taxation. The LGPS is very costly to the taxpayer. This has been made worse by growing fund liabilities, people living longer, lower gilt yields, and until recently, poor investment markets. This means that Council Tax is rising each year, partly to pay for the growing deficit.
The scheme is under review at the moment by Government. The aim is to be fair to tax payers, staff, those with deferred benefits and those already in receipt of their pensions. Whatever the decision that the Government takes, it is likely to upset some as change always means winners and losers.