Brunel Pension Partnership, one of eight UK Local Government Pension Scheme (LGPS) pools, said it is making cost savings of £41m per year, and it is on track to deliver £43m in net savings per annum by 2025.
The pool looks after the investment of 10 pension funds: Avon, Buckinghamshire, Cornwall, Devon, Dorset, the Environment Agency, Gloucestershire, Oxfordshire, Somerset and Wiltshire.
The partnership’s most recent annual report and financial statement show that Brunel has “already broken even” saving around four-and-a-half times the costs it incurs via the management fees.
But, as the pool matures it said that the “pre-pooling position becomes less relevant to our clients”, adding that it has implemented a value for money balanced scorecard, which focuses on the long-term sustainability of the business to ensure the requirements of key stakeholders are being met.
The partnership said: “We will drive our future performance by measuring financials, customer service, internal processes, and learning and growth to evaluate overall performance and to move away from a pure cost-savings focus.
It said it will remain a “client outcomes-driven business” with the following three strategic objectives:
- resilient delivery of core services;
- delivery of value for money;
- delivery of returns required through cost-effective, industry-leading responsible investment solutions.
Year in review
Brunel said that over the last year, assets under management increased to £30.8bn, equating to 84% of client investment within the partnership pooled structure.
Listed markets accounted for £25.2bn across 18 portfolios and these continue to be managed to meet client investment needs.
At year-end, it said that private markets portfolios accounted for £3.5bn of deployed capital (excluding property) and a further £3.4bn committed from the three investment cycles implemented, including the launch of a private equity portfolio of funds managed by Neuberger Berman.
Brunel said that discussion with clients are currently taking place regarding potentially launching cycle 4 in April 2024. A further £2.1bn represents property assets now managed by Brunel on behalf of clients.
It added that performance for the listed market portfolios was “positive in absolute terms” and “mixed in relative terms”, with the Global High Alpha, Global Small Cap Equities and Sterling Corporate Bond portfolios ahead of their benchmarks, and the UK, emerging markets and the sustainable equities portfolios behind. The Diversified Returns Fund and Multi Asset Credit Portfolio each posted positive absolute returns.
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