1. And the main challenges
LGPS in 2017
England and Wales
Key message :-The LGPS remains affordable
Activists can make a difference
And the main challenges
The LGPS must still remain open to new members and protect those outsourced
The assumptions used in the 2016 Valuation
too pessimistic-may cost jobs
Cost pressures on cost share
The compensation cap on redundancy
Threats for the future?
Possible change to tax relief
Pensions Freedom
Increasing State Pension Age
Contact Glyn Jenkins –Head of Pensions UNISON

2. The LGPS must still remain open to new members and protect those outsourced
There is pressure especially in further education colleges to try and get out of the LGPS because in many cases their contributions are increasing. Costs are increasing on many colleges because they can now go bust so increased risk for the funds leading to shorter payback periods to make good deficits

3. The assumptions used in the 2016 Valuation too pessimistic-may cost jobs
The value of the 89 funds do not affect the benefits but they do determine the cost of employer contributions leading to pressure to leave the LGPS cut services and jobs The cost is not based on the performance or charges on the investments but the assumptions used by funds to value their future liabilities ie cost of members

4. Cost pressures on cost share
Cost share occurs at scheme level not at fund level.
The main cost pressure on the scheme at this valuation is not increasing life expectancy but the low take up of the 50 /50 option.
It was anticipated 10% of low paid workers would elect to pay half their contributions for half the pension build up. Less than 1% have taken this option.
The good news is that there is little pressure to increase member contributions

5. Threats Political Possible change to tax relief Pensions Freedom
Good pension provision continues to decline in the private sector pressure to dumb down
Possible change to tax relief
Chancellor may target tax relief on pension contributions in the next budget
Pensions Freedom
Members are being targeted by pension scams and many may be desperate to cash in pensions to pay debts.
Increasing State Pension Age
Reports have recommended further increases in SPA and little flexibility on when SP is paid

6. Questions and comments
To Glyn Jenkins Head of Pensions UNISON