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Hermes Investment Management has landed a£220m index-tracking mandate with Croydon LBC's pension fund.

The FTSE 100 indexed portfolio is worth around half the value of the fund and represents a significant win for Hermes. The firm beat off competition from Barclays Global Investors and Legal & General, the biggest index-tracking fund managers in the council investment market.

Ian Talbot, head of treasury at Croydon, identified Hermes' strong corporate governance credentials as a key factor in the appointment. One of the criticisms levelled at traditional index-tracking, or 'passive', managers is that they bring little influence to bear on the behaviour of companies because they simply look to track stock-market indices.

Mr Talbot said: 'Their [Hermes'] approach to corporate governance is in line with our thinking - we firmly believe in engagement with companies whose shares we hold.'

He said Hermes represented 'excellent value for money' and had produced strong, long-term index-tracking performance.

Croydon's decision to seek an external passive manager was triggered by the retirement of in-house treasury and investment manager Ivan White.


Brighton & Hove City Council has chosen Jarvis as its contractor to refurbish schools and build extensions under a private finance deal worth around£40m.

Some£25m of new funding is from the government, with the remainder to be invested by Jarvis. Work will begin in January and be completed by autumn 2003.

Executive member for education Frieda Warman-Brown (Lab) said: 'The council evaluated two strong bids and now has a first-class proposal to take forward into the next stage. The project will attract large-scale government funding which would not otherwise be available.'

The council said schools and trade unions had been consulted and this would continue as the project developed.


Northumberland CC is being replaced as the IT provider at Castle Morpeth BC after more than 20 years.

The council has decided its core IT systems will be delivered by Sx3 in a£2m-managed-services deal.

The current deal with the county council runs until March 2003. In the mean time Sx3 will implement new systems so the project can go live at the start of April 2003.


Newcastle City Council has drawn up a shortlist of three consortiums to bid for a£300m regeneration of the city's riverside area.

The shortlisted bidders are Preston-based Places for People Group, and two consortiums of builders, -Wimpey, Bellway and Persimmon, and Barrat, Haslam and Miller Homes NE.

Thousands of homes, shops and a school are expected to be built during a 10-year partnership after the council chooses the winning consortium in January.

Newcastle cabinet member for housing and regeneration, Ruth Robson (Lab), said: 'As a development area, the riverside frontage is just 10 minutes from the city centre, making it one of the best urban development sites in the country. But without doubt its biggest strength is its progressive community which is keen to grasp the opportunities of regeneration.

Shona Alexander, manager of the council's regeneration team, said 'We will be particularly interested to see how the consortia intend to involve local people in the regeneration of Walker Riverside.'


London mayor Ken Livingstone and transport commissioner Bob Kiley have decided not to appeal against a High Court ruling which gave the go-ahead to plans to partly privatise the tube.

Their decision follows legal advice that an appeal would be unlikely to succeed. But Mr Livingstone maintains that the government's plans represent 'an inherently unworkable management scheme'.

'Mr Justice Sullivan made clear there is nothing in the Greater London Authority Act [1999] to compel the mayor to incorporate PPP contracts into the transport strategy,' he said.

The judge ruled in favour of Mr Livingstone the day after the first ruling by overturning an injunction preventing publication of a report by financial advisers Deliotte and Touche.

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