The trade union for many local govenment workers, Unison, has warned that any local government pension assets invested in infrastructure should only go ahead if it is in the members’ best interests.
Unison’s warning comes after Chancellor George Osborne revealed a plan for the local government pension scheme (LGPS) to be formed into six national wealth funds, with billions of pounds in assets ploughed into UK infrastructure projects.
Dave Prentis, Unison general secretary, commented: “The Chancellor should not use our pension funds as a convenient way of making up for the infrastructure investment that no longer happens. Nor should they be used as replacement capital for the government’ privatisation programmes.”
Prentis added that pension fund assets are legally required to secure the best return for members and this is how the 89 LGPS funds operate. If the £193 billion in LGPS assets are pooled, Prentis said, then the cost of pooling must be transparent, with no hidden charges, fees or transactions that would mean members taking a huge financial hit. He added that any decisions on combining LGPS funds in mini-wealth funds must involve LGPS members at the heart of the process.