Border to Coast Pensions Partnership is on target to deliver cost savings of £340m (€391m) for its 11 partner funds by 2030 after delivering £65m in savings so far, according to its annual report.
The report from one of the UK’s largest Local Government Pension Scheme (LGPS) pools showed that five years after launch, 83% of the assets owned by Border to Coast’s 11 partner funds have already been pooled and collective net savings are on track to reach £340m by 2030.
So far, Border to Coast said it saved its members an estimated £65m – a figure it expects to “increase significantly” in the coming years. Last year, Border to Coast said it saved it’s members £14m during 2021/22, and £32m in total, meaning the pool doubled it’s total savings in the last year.
However, Rachel Elwell, chief executive officer, said pooling is “more than delivering cost savings” and LGPS pool focus remains on “how we can deliver value” which includes developing new investment opportunities.
According to the annual report, Border to Coast is building on its existing investment opportunities, including its £12bn private markets programme which is investing more than £4.3bn in infrastructure and £3bn in private equity.
A new ‘UK Opportunities’ strategy will provide its partner funds with additional opportunities to invest in private market assets across the UK, such as venture and growth capital.
Border to Coast said that in total nearly £50bn of assets are in pooled vehicles either operated directly or overseen by the LGPS pool, with over 130 colleagues focused on delivering effective investment solutions for its 11 partner funds.
Border to Coast and its partner funds will be sharing their experience of how pooling can deliver innovative investment opportunities that underpin the pensions of more than 1.1 million members, and delivers productive finance that supports economic growth, with the government as part of its consultation on the future of the LGPS.
Chris Hitchen, chair of Border to Coast, said: “Five years into our journey, we are exceeding the original ambitions for pooling. With 83% of our partner funds’ assets pooled we have been able to deliver over £65m of savings net of set-up costs with more to come.
“But perhaps more importantly, we have built a sustainable centre of expertise in Leeds delivering innovative and effective investment solutions for our partner funds.”
Elwell added: “With the support of our partner funds, we have built a strong and resilient organisation, with the right people and culture, to support partner funds in the implementation of investment strategy.
“With our in-house investment team, we have built a range of innovative and high-quality investment propositions, and our £12bn private markets programme is delivering significant investment into growth capital and infrastructure.”
She added that she was pleased with the pool’s innovative UK Opportunities strategy, “which will facilitate investment leading to the generation of a range of positive local impacts, such as new jobs, infrastructure, and economic growth across the regions of the UK, while providing returns to fund pension obligations”.
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