Tower Hamlets Council's Pension Fund will be required to take primary investment advice from the London Collective Investment Vehicle (CIV) after 31 March 2026, according to a paper from Mercer, included in the Quarterly Investment Review - September 2025. This shift is a result of the 'Fit for Future' review, which aims to strengthen asset pooling, enhance oversight and governance, improve consistency, efficiency and transparency, support long-term returns, and ensure uniform implementation across authorities. The consolidation of assets into pools is mandated by the review.
The shift to the London CIV is expected to result in the Fund having to take primary investment advice from the London CIV after the 31st of March 2026 deadline. The report notes that there is a risk of misalignment between Pool and Fund-specific investment goals (e.g., local impact, infrastructure weighting) and that funds with more active, bespoke, or thematic mandates could see lower returns or divergence from actuarial assumptions.
The Tower Hamlets Pensions Committee met on 11 December 2025, to discuss the implications of this change and other key issues affecting the fund.
According to the Quarterly Investment Review - September 2025, establishing clear investment objectives will be crucial for the fund moving forward. Examples of objectives include:
- Target investment return to support discount rate
- Probability of achieving full funding over X years
- Downside risk Value at Risk (95%)
- Probability of maintaining contributions >67%
- Return of surplus
- Income requirements
- Net Zero target
- Responsible Investment objectives
- Maximum allocation to illiquid assets
- Target allocation to
local investment
At the Pensions Committee meeting, John Jones, Independent Chair of the Pension Board, raised concerns about the governance arrangements with the London CIV, specifically advocating for more meaningful representation of employees within the CIV. While the documents note that the governance arrangements for the London CIV were discussed, specific steps to address Mr. Jones' concerns are not outlined.
