The Barking & Dagenham Pension Fund has underperformed its benchmark over the quarter ending June 30, 2026, and over the past 12 months, according to a report presented to the Pensions Committee. The fund achieved a return of 7.28% during the quarter, falling short of its benchmark of 8.64%, resulting in an underperformance of 1.36%. Over the preceding 12 months, the fund returned 14.48%, also underperforming its benchmark of 16.60% by 2.12%.

Bar chart comparing the rate of return for the pension fund against its benchmark over various time periods.
Bar chart comparing the rate of return for the pension fund against its benchmark over various time periods.Source: Pensions Committee papers, 16 September 2026

Councillor Caleb van Ryneveld questioned the reasons for this underperformance, despite strong overall returns. The Head of Pension Fund, Treasury and Capital, explained that the shortfall was due to the underperformance of specific active investment managers, naming Kempen Capital Management and Baillie Gifford as particular concerns. This underperformance was specifically attributed to their management of equity portfolios.

The fund's value increased by £110 million to £1.82 billion during the quarter, driven by strong market performance, particularly in global equities. However, this £110 million increase was less than what would have been expected if the fund had met its benchmark, as its performance of 7.28% was below the benchmark of 8.64% for the quarter, resulting in an underperformance of 1.36%.

A pie chart illustrating the asset allocation of the pension fund, with Equity being the largest component at 62.06%.
A pie chart illustrating the asset allocation of the pension fund, with Equity being the largest component at 62.06%.Source: Pensions Committee papers, 16 September 2026

Councillor van Ryneveld also inquired about the long-term performance history and whether there was room for review regarding the consistent underperformance of Kempen Capital Management and Baillie Gifford over the last five years. The meeting information reveals that over the past 12 months, the fund returned 14.48% against a benchmark of 16.60%. The 3-year return was 11.35%, underperforming the benchmark of 12.82%. Over ten years, the fund's return was 8.44% against a benchmark of 9.42%.

Bar chart showing the longer-term performance of the pension fund in percentage per annum, with data for FYTD, 1 Year, 3 Years, 5 Years, 10 Years, and 20 Years.
Bar chart showing the longer-term performance of the pension fund in percentage per annum, with data for FYTD, 1 Year, 3 Years, 5 Years, 10 Years, and 20 Years.Source: Pensions Committee papers, 16 September 2026

In response to the concerns about underperforming managers, Nemashe Sivayogan indicated that further discussions would take place in a subsequent meeting. A separate paper addressing government regulations and implementation plans is expected, where these points will be addressed.

The benchmark against which the Barking & Dagenham Pension Fund's performance is measured is not explicitly defined in terms of its composition, but its performance is compared against it. For the quarter of April to June 2026, the fund's performance was 7.28% against a benchmark of 8.64%. Over the past 12 months, the fund returned 14.48%, underperforming its benchmark of 16.60%.

More information on the committee's proceedings can be found in the Public reports pack Wednesday 16-Sep-2026 19.00 Pensions Committee.