Unions, city agree in principle to create investment advisory board for pension funds

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UFT President Michael Mulgrew spoke at the Oct. 27 City Hall press conference.

UFT President Michael Mulgrew, City Comptroller John Liu, Mayor Bloomberg and other municipal union leaders announced an agreement in principle to create a new investment advisory board that will oversee the investment process for all five New York City pension funds while retaining the independent status of each fund. The plan, still in its exploratory phase, will need approval from Albany. The aim is to increase the professionalism of the investment decisions and improve the returns on investments while reducing investment fees and consultant costs.

Read UFT President Michael Mulgrew’s email message to members about the plan:

Dear colleagues,

We are always looking for opportunities to expand and enhance the efficiency and value of the Teachers’ Retirement System pension fund. Today, I am proud to announce that we have begun a formal process to do just that. We are outlining this process at a press conference today.

Working in conjunction with our trustees, other unions, City Comptroller John Liu and City Hall, we are entering into an exploratory process to improve how our fund makes investments. The move comes after recommendations by our trustees, and after months of discussion and research.

The idea is to find ways to boost the fund’s performance by streamlining and modernizing the process by which investments are made, thereby increasing the fund’s efficiency and the rate of returns. That includes removing extra layers of consultants and further depoliticizing the investment process.

I want to be very clear — there are no changes being made to your pension benefits. Quite the contrary, actually: If the proposed changes are made with the approval of the unions, our trustees will have more control over the fund. Protecting TRS investments and well-earned member benefits is paramount.

Make no mistake: Our fund is performing exceptionally well and we can be proud of that. Our trustees and the comptroller’s office believe there are ways it can perform even better, and we wanted to let you know that we will be exploring options to do so.

Sincerely,

Michael Mulgrew
UFT President