One of my memories of working as a junior officer in various councils in my relative youth was the existence of the colleague who, although strictly an amateur in the subject, could explain the pension scheme.

They normally showed a zeal and flair for complex mathematical formulae and dense regulations that you would not always have guessed at from observing them more generally.

They were always keen to offer you an informal consultation, but, if no one asked, would be happy to talk at some length about the impact of any recent changes on their own pension arrangements!

And now, I must confess, that I too am focusing on the issue of the Local Government Pension Scheme.

Not, it has to be said, simply because of my advancing years, but with the Government seeking out alternative forms of funding major infrastructure projects, the funds controlled by local government schemes across the country have presented an apparently glittering prize.

It may be true that, if you were to start with a clean sheet, you wouldn't necessarily design the local government pension scheme as we have it now with over 80 different funds.

Any  efficiency savings, however, must be put in the context of the scale of the funds themselves. 

London's local government pensions schemes alone are managing funds in excess of £20bn. Getting the right returns is as important as realising efficiency savings in management costs.

That said, is there a better way to manage our pension schemes?

The Government is due to consult on this very soon. Meanwhile, the leaders of London's boroughs have taken a proactive view that there might be a better way and that it is local government itself, rather than new directives, that is best placed to develop improved arrangements for the future.

London's local authorities have asked industry professionals to assist in shaping a new future for London's funds.

This would maintain local accountability and control but open up very real potential of significant savings in costs and increased returns.

A business case for a Common Investment Vehicle (CIV) that would be available to the capital's borough pension funds from 2015 is being developed.

This builds on the Treasury's new Authorised Contractual Scheme and work by authorities in some county areas, as well as in Wales.

The main immediate benefit is to cut costs. For instance, collectively procuring the management of ‘passive funds' should immediately make a significant saving.

There are wider, longer-term benefits. Better management of our assets is key.

It is councils, working together, that can take the lead and show the way as to how this can be done.

John O'Brien is chief executive of London Councils