Mayor of London Boris Johnson has appointed Edi Truell, chairman of the London Pension Fund Authority (LFPA), as an adviser on public sector pensions.
Mr Truell’s role, which is unpaid, is to “drive forward collaboration between public sector pension funds and invest the proceeds in infrastructure and housing in London and across the country”.
The move comes after the mayor angered local government pension scheme officers by citing statistics about public sector funds that they claimed were incorrect, which it later emerged Mr Truell (pictured) had given him.
The LPFA has long advocated greater collaboration between funds and far more investment in infrastructure, proposing last year that LGPS funds should pool their assets to create a £30bn “citizen’s wealth fund”.
In December, the LPFA created a £10bn asset pooling vehicle with the Lancashire CC pension fund. As part of his new role, Mr Truell will establish an advisory board for this partnership. He will resign his chairmanship of the LPFA on 1 September.
Mr Johnson said: “Edi’s leadership of the LPFA has been a great success and the work that he has done so far to consolidate our funds with our northern counterparts is a triumph of service to public finance.
“If we now use this new partnership as a blueprint for further pooling of pension funds, we could have a war chest worth hundreds of billions of pounds and access to the kind of investment opportunities which have until now been the preserve of foreign sovereign wealth funds.”
Mr Johnson attracted criticism late last year when he claimed in a Telegraph editorial that there were 39,000 public sector pension funds in the UK, which should be merged to save money on investments and fund infrastructure projects.
Many LGPS officers pointed out that the seven main public sector schemes aside from the LGPS, such as those for NHS workers and fire fighters, are unfunded, meaning they do not have any assets to invest.
Others questioned the 39,000 figure, claiming that Lord Hutton’s review of public sector schemes found only 300, plus around 100 more that are quasi-governmental. It emerged that the mayor had got the figure from Mr Truell, who in turn took it from a 2007 House of Commons paper which said the Government Actuary’s Department “estimates that there may be as many as 30,000 to 40,000 pension schemes in the public sector, although these include many single-member schemes”.