Local authority pension pool Brunel Pension Partnership (Brunel) has appointed FundRock as Authorised Contractual Scheme (ACS) operator for its £7.5bn active equity portfolio.
Brunel, which currently manages £30bn on behalf of 10 local government pension schemes, says it has chosen the ACS model to combine tax transparency with a simpler, lower cost operating model.
The ACS model allows Brunel to structure its investments through a number of sub-funds and to appoint different investment managers for each sub-fund.
Brunel will act as a sponsor and investment manager of the ACS while FundRock acts as operator who will be responsible for meeting regulation requirements and contractual arrangements.
Brunel’s COO Joe Webster comments: “This model allows us a good degree of flexibility when choosing investment managers. The ACS also performs risk control, adding an additional level of governance and control over our transactions for clients. All in all, it’s a good decision for our shareholder client funds in the Brunel partnership.”
Another benefit of the model for Brunel is its tax status, as the pension scheme is set to receive significant discounts on stamp duty and withholding tax.
Brunel is one of eight national LGPS pools, and will manage investment of the pension assets for the funds of Avon, Buckinghamshire, Cornwall, Devon, Dorset, the Environment Agency, Gloucestershire, Oxfordshire, Somerset and Wiltshire.
