Leicestershire CC’s pension fund has deferred joining the Local Authority Pension Fund Forum over “concerns” about the way it is “structured and constituted”.
The LAPFF is a shareholder engagement group comprising 72 of the 89 English and Welsh Local Government Pension Scheme funds. It acts as a single voice for those funds as shareholders when engaging with companies in which the scheme invests.
The £3.8bn Leicestershire fund is part of the LGPS Central pool, the other eight members of which are already members of the LAPFF. The Leicestershire fund is expected to join the forum as part of its pool membership, but Leicestershire’s director of finance has reservations about the forum.
A report prepared by the director of corporate resources Brian Roberts for the pension fund committee meeting in September said: “The LAPFF is likely to be heavily utilised in any shareholder engagement conducted by LGPS Central, and it is not reasonable for the Leicestershire Fund to receive the benefit of any such work unless it becomes a member.”
It noted the cost to the Leicestershire fund of joining the forum would be “around £9,000” per year.
However, the report added: “There are some concerns about the way in which the LAPFF is currently structured and constituted, and in particular the potential for the organisation and its future direction to be overly influenced by certain individuals or funds.”
Although the report said officers expect these concerns would “ultimately be dealt with”, they recommended the fund deferred joining the forum “until the director of finance is satisfied that these concerns have been addressed”.
A spokesperson for the Leicestershire pension fund said it was not in a position to comment on the matter.
The LAPFF did not respond to requests for comment.