GOVERNANCE OF THE LOCAL GOVERNMENT PENSION SCHEME

That this House welcomes the seventh report by the Communities and Local Government Select Committee, Local Authority Investments, HC164, which highlights the importance of healthy and transparent local authority finances; notes the use of hard-pressed Local Government Pension Scheme (LGPS) funds by local authorities to finance day to day local authority services; further notes that by returning investments to the LGPS through the lower Bank of England rate, local authorities have generated and retained a premium; expresses concern that councils have used LGPS funds to increase returns for their budgets rather than for the benefit of scheme members; and calls on the Government to end these practices and to introduce a statutory requirement to ensure that LGPS investments are made in the interests of scheme members, rather than the administering authority.