Latest news with #NeilRecord
Yahoo
09-06-2025
- Business
- Yahoo
London council to spend £100m from gold-plated pensions on homelessness
A London council is facing criticism over plans to use its gold-plated pension scheme to fund accommodation for homeless people. The Royal Borough of Kensington and Chelsea will invest £100m from its pension fund to buy 250 homes in an effort to save taxpayer money. It comes amid mounting scrutiny of councils' gold-plated pensions after The Telegraph revealed some authorities were spending more than half of taxpayers' money on staff schemes. But experts questioned whether it was appropriate for Kensington and Chelsea to use its pension fund to 'indulge political objectives'. Neil Record, a former Bank of England economist, said: 'Local Government Pension Funds benefit from a de facto government guarantee which allows local councils to indulge their political objectives at the expense of prudent investment management. This is a particularly egregious example.' The Conservative-led council's pension scheme is worth £2bn, twice the amount needed to fully meet obligations to its members, meaning it is in rude health financially. The vast savings pot has become a target for councillors seeking to raise money for more spending without significantly increasing council tax bills. In February it was announced payments into Kensington and Chelsea's defined benefit scheme would be halted temporarily to save £9m earmarked for survivors of the 2017 Grenfell Tower fire. This went against the advice of the fund's actuaries who said it would be 'inappropriate' to lower contributions before next spring but agreed the move would 'not have a detrimental effect' on the council's ability to pay out pension benefits. Michael Hayles, of law firm Burges Salmon, said: 'The Kensington and Chelsea fund has a well-publicised strong funding level. 'However, as things stand, this investment will still need to stand up as an appropriate investment, with appropriate returns, bearing in mind the fiduciary duties of the pension fund when making investment decisions, notwithstanding the funding surplus.' There is no blanket legal guarantee that would compel the Government to meet the costs of all funds within the LGPS or make good their deficits. More than a quarter of schemes within the LGPS were in deficit in 2022, according to an official review published last year. Cllr Emma Will, who oversees property at the town hall, said more local authorities could follow Kensington and Chelsea's example, as many struggle to fund the costs of meeting their statutory obligations. She added: 'We are fortunate to have an extremely well-managed pension fund, it's been the best performing for 30 years [and] it's very over-funded, which is terrific.' Ms Will said that the unusual move was 'completely above board' and should not be discredited simply because 'it hasn't been done before'. She said that investing £100m was 'very low risk' because the council plans to pay its pension fund for use of the new properties with government grants it receives to tackle homelessness. 'It is innovative and we are quite excited. If we get this right it's like the holy grail. We believe it does work, and it's nil cost to the council and it's low risk and win-win for everyone.' Last year bills in Kensington and Chelsea for the average Band D property were £1,569.46 a year, up from £1,508.98 the previous year. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
09-06-2025
- Business
- Telegraph
London council to spend £100m from gold-plated pensions on homelessness
But experts questioned whether it was appropriate for Kensington and Chelsea to use its pension fund to 'indulge political objectives'. Neil Record, a former Bank of England economist, said: 'Local Government Pension Funds benefit from a de facto government guarantee which allows local councils to indulge their political objectives at the expense of prudent investment management. This is a particularly egregious example.' The Conservative-led council's pension scheme is worth £2bn, twice the amount needed to fully meet obligations to its members, meaning it is in rude health financially. The vast savings pot has become a target for councillors seeking to raise money for more spending without significantly increasing council tax bills. In February it was announced payments into Kensington and Chelsea's defined benefit scheme would be halted temporarily to save £9m earmarked for survivors of the 2017 Grenfell Tower fire. This went against the advice of the fund's actuaries who said it would be 'inappropriate' to lower contributions before next spring but agreed the move would 'not have a detrimental effect' on the council's ability to pay out pension benefits. Michael Hayles, of law firm Burges Salmon, said: 'The Kensington and Chelsea fund has a well-publicised strong funding level. 'However, as things stand, this investment will still need to stand up as an appropriate investment, with appropriate returns, bearing in mind the fiduciary duties of the pension fund when making investment decisions, notwithstanding the funding surplus.' There is no blanket legal guarantee that would compel the Government to meet the costs of all funds within the LGPS or make good their deficits. More than a quarter of schemes within the LGPS were in deficit in 2022, according to an official review published last year. Drawing down £100m is 'very low risk' Cllr Emma Will, who oversees property at the town hall, said more local authorities could follow Kensington and Chelsea's example, as many struggle to fund the costs of meeting their statutory obligations. She added: 'We are fortunate to have an extremely well-managed pension fund, it's been the best performing for 30 years [and] it's very over-funded, which is terrific.' Ms Will said that the unusual move was 'completely above board' and should not be discredited simply because 'it hasn't been done before'. She said that investing £100m was 'very low risk' because the council plans to pay its pension fund for use of the new properties with government grants it receives to tackle homelessness. 'It is innovative and we are quite excited. If we get this right it's like the holy grail. We believe it does work, and it's nil cost to the council and it's low risk and win-win for everyone.' Last year bills in Kensington and Chelsea for the average Band D property were £1,569.46 a year, up from £1,508.98 the previous year.
Yahoo
07-04-2025
- Business
- Yahoo
With 38% ownership, Record plc (LON:REC) insiders have a lot riding on the company's future
Insiders appear to have a vested interest in Record's growth, as seen by their sizeable ownership A total of 4 investors have a majority stake in the company with 52% ownership Institutional ownership in Record is 32% Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. To get a sense of who is truly in control of Record plc (LON:REC), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 38% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company. With such a notable stake in the company, insiders would be highly incentivised to make value accretive decisions. In the chart below, we zoom in on the different ownership groups of Record. See our latest analysis for Record Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index. Record already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Record's historic earnings and revenue below, but keep in mind there's always more to the story. Record is not owned by hedge funds. Neil Record is currently the largest shareholder, with 27% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 10% and 8.3%, of the shares outstanding, respectively. Furthermore, CEO Jan Hendrik Witte is the owner of 0.7% of the company's shares. To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making. Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There is some analyst coverage of the stock, but it could still become more well known, with time. The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it. I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions. Our information suggests that insiders maintain a significant holding in Record plc. It has a market capitalization of just UK£96m, and insiders have UK£36m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently. The general public-- including retail investors -- own 17% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders. It seems that Private Companies own 3.2%, of the Record stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company. While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Record has 1 warning sign we think you should be aware of. If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts . NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Yahoo
07-04-2025
- Business
- Yahoo
With 38% ownership, Record plc (LON:REC) insiders have a lot riding on the company's future
Insiders appear to have a vested interest in Record's growth, as seen by their sizeable ownership A total of 4 investors have a majority stake in the company with 52% ownership Institutional ownership in Record is 32% Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. To get a sense of who is truly in control of Record plc (LON:REC), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 38% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company. With such a notable stake in the company, insiders would be highly incentivised to make value accretive decisions. In the chart below, we zoom in on the different ownership groups of Record. See our latest analysis for Record Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index. Record already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Record's historic earnings and revenue below, but keep in mind there's always more to the story. Record is not owned by hedge funds. Neil Record is currently the largest shareholder, with 27% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 10% and 8.3%, of the shares outstanding, respectively. Furthermore, CEO Jan Hendrik Witte is the owner of 0.7% of the company's shares. To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making. Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There is some analyst coverage of the stock, but it could still become more well known, with time. The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it. I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions. Our information suggests that insiders maintain a significant holding in Record plc. It has a market capitalization of just UK£96m, and insiders have UK£36m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently. The general public-- including retail investors -- own 17% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders. It seems that Private Companies own 3.2%, of the Record stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company. While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Record has 1 warning sign we think you should be aware of. If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts . NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Yahoo
05-03-2025
- Business
- Yahoo
The Government spent the Royal Mail pension pot – costing taxpayers £4m a day
Taxpayers have been handed a £45bn bill for Royal Mail's pensions after government mismanagement left the scheme with no money to pay retirees, The Telegraph can reveal. The coalition government took over most of the company's pensions in 2012 ahead of privatisation, but then spent the scheme's assets and left taxpayers on the hook for decades of payments, an expert warned. As a result, the gold-plated scheme has cost taxpayers £16.5bn since 2012, an average of around £3.8m a day, fresh analysis of official data shows. There is another £28.7bn still to pay before the scheme finally ends. It comes after The Telegraph exposed several incidents of waste and mismanagement across the UK's public sector pension schemes. The NHS was found to have lost £5.6m by sending money to dead pensioners that cannot be recovered and the Government has spent £1.25bn bailing out the Environment Agency's pension scheme. Royal Mail had been facing difficulties since the turn of the century, as the rise of email and the internet affected demand for posting letters. In 2010, the coalition government started making the argument for privatisation and two years later, Royal Mail was separated from the Post Office. To prepare for privatisation, the Government also assumed responsibility for the Royal Mail Pension Plan's deficit and most of its pensions in April 2012. Retirement payments accrued up to this date were moved into the newly created Royal Mail Statutory Pension Scheme. However, the Government did not use the scheme's existing funds to make investments for future pension payments. Instead, Parliament has since voted on the amount needed each year, and the pensions are then paid in full – leaving the taxpayer to foot the bill. Neil Record, a former Bank of England economist, said: 'The Government promised index-linked pensions to a large group of employees, then took the £29bn that sat in the pension fund and spent it. 'Out of the blue, a new unfunded liability of approximately £50bn emerged solely to allow the Government to sell off the Royal Mail. 'That £50bn is saddling future taxpayers with the obligation to repay this debt.' The scheme is closed, meaning no one else can join and no more contributions are added. It will run for as long as there are members drawing a pension. The cost of the scheme has risen from £1.2bn back in 2012-13 to £1.6bn last year. The scheme forecasts that this will rise to £1.7bn this year. Almost 204,000 retirees are already receiving payments, while another 145,000 have built up pensions and are still working. The pensions on offer provide a guaranteed, inflation-linked income for life, and many come with a tax-free lump sum. Royal Mail's privatisation began in 2013 and was completed by 2015. Current workers are members of the Royal Mail Pension Plan and have earned contributions towards retirement pots, rather than final salary pensions, since 2018. The scheme's latest valuation showed a surplus of over £1bn. In October last year, the company then became the first in Britain to offer a collective pension fund, similar to those in Canada and Denmark. It is currently in the middle of a takeover bid from Czech billionaire Daniel Kretinsky. The Cabinet Office, which is responsible for the closed scheme, declined to comment. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
