ADD341 Alternative Pension Provision for the Mayor and Assembly

Type of decision: 
Assistant Director's decision
Date signed: 
21 August 2015
Decision by: 
David Gallie, Executive Director of Resources

Executive summary

Following the 2016 GLA elections, the Mayor and Assembly will no longer be able to participate in the Local Government Pension Scheme. The Authority requires advice to be commissioned on alternative pension provision for the Mayor and Assembly from the authority’s actuary.


The Assistant Director approves an exemption from the GLA Contracts and Funding Code up to £14,000, plus VAT, to:
1. Pay the London Pensions Fund Authority (LPFA) following the LPFA instructing Barnett Waddingham to provide advice on alternative pension provision, to the satisfaction of GLA’s Executive Director of Resources.
2. Authorise the Assistant Director (or any senior Member of Staff nominated by him for such purpose) to enter into any such necessary documentation as may be required relating to this decision. 


Part 1: Non-confidential facts and advice

Introduction and background

With effect from the immediate aftermath of the 2016 GLA elections, the Elected Members of the GLA (ie. The Mayor and 25 Assembly Members) will not be able to contribute to the Local Government Pension Scheme (LGPS) and they will no longer accrue any further rights in the scheme. Therefore, after the 2016 Elections the London Pensions Fund Authority (LPFA) will no longer be able to play a role in future pension arrangements for Elected Members in the GLA (although they will oversee the previous arrangements made by Elected Members). However, the GLA has the power to make alternative arrangements for Elected Members outside of the LGPS.

Objectives and expected outcomes

There is a need to commission expert advice on the best alternative pensions arrangements that might be made available to Elected Members of the GLA within available resources. A detailed specification has been drawn up. This advice would best be prepared by the LPFA’s actuary, Barnett Waddingham, as they are familiar with the GLA’s requirements and issues and have provided the GLA with advice before.

LPFA appointed Barnett Waddingham under a formal tender process for its own purpose which is compliant with the relevant procurement rules and in accordance with LPFA’s code of practice and governance arrangements.

It is proposed that the GLA re-imburses the LPFA, once Barnett Waddingham complete the advice to the satisfaction of the GLA’s Executive Director of Resources.

Financial comments

5.         Financial comments

 It is estimated that the cost of the advice could be up to £14,000, plus VAT. The cost of this advice is to be met from the GLA’s contingency provision.

6.         Legal comments

Section 4.1 of the GLA's Contracts and Funding Code (the "Code")) requires the GLA to undertake a formal tender process or make a call off from a framework for procurements with a value between £10,000 and £150,000.  However, section 5.4 of the Code also provides that an exemption from this requirement may be justified on the basis that there has been previous involvement which cannot be separated from this new work.  Officers have set out at paragraph 2 above the reasons why the procurement of Barnett Waddingham via the LPFA falls within that exemption. 

Local Government Pension Scheme (Transitional Provisions, Savings and Amendments) Regulations 2014 on the LGPS which came into force on 1 April 2014 explicitly preclude the Mayor and Assembly Members from accessing the LGPS after the term of office which that member is serving. However, under Section 26 of the GLA Act, the Authority has the power to make such provision for the payment of pensions to former Elected Members, as the Authority may determine.  The Authority may therefore make alternative pension arrangements, outside of the LGPS, for its Elected Members. 

Planned delivery approach and next steps



Advice from Barnett Waddingham due to be received

31 August 2015

Officers prepare proposals to be considered by the Bureau of Leaders

Autumn 2015

The Mayor and Assembly agree alternative pension provision to be available to newly Elected GLA Members

Autumn 2015

Alternative pension provision available to newly Elected GLA Members           

May 2016

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