Agenda item

This report (LPB8) follows up on the discussion by the Board at their last meeting in respect of concerns regarding employer data, and the issuance of pension information to scheme members including annual benefit statements. The report covers the specific issues raised by the Board, as well as the subsequent report to the Pension Fund Committee.

The Board is invited to note the latest position on employer management and to offer any further comments.  As the full performance model is developed following completion of the 2016 Valuation, further reports will be brought to the Board for their information and consideration.

The Board considered a report (LPB8) which covered the specific issues raised by this Board during its discussion at the last meeting in respect of concerns regarding employer data, and the issuance of pension information to scheme members, including annual benefit statements.

At its last meeting, the Board raised concerns about the lack of information on how many scheme members were missing more than just their last annual benefit statement, and suggested options to improve communication with such members going forward. Other proposals were raised to improve the overall performance in this area. As requested, an update on the position was before the Board (LPB8), including details of the subsequent discussion and decisions of the Pension Fund Committee when it discussed this issue at its December meeting. The Officer report to the Committee was also included as an Annex to this report (LPB8).

Mr Collins reported that since the initial report to the Regulator, 1,298 more statements had been issued, the majority of which were to Oxford City Council staff. This left 8,197 outstanding, or 42% of the active membership. Within this outstanding figure were 3 significant groups of employee, the Academies (3,187), Oxford Brookes (2,310) and the balance on Oxfordshire County Council (989).

 During discussion the Board noted that:

·         most authorities had struggled after the scheme changes in 2014 to issue their statements but there was a need to ascertain the reasons why Oxfordshire’s statistics appeared worse than other authorities;

·         noted that this year’s breach had been reported to the Regulator and a further response was awaited;

·         Brookes had employed more staff to rectify the problems with their data, and, following recent discussions, a clear way forward had been determined;

·         The issues with Academies had been compounded  by a recent change in their payroll provider. Errors on final pay data had recently been reported impacting 2,700 staff, with a further 470 statements delayed due to queries on CARE data;

·         just under 1,000 queries were waiting for a response from Oxfordshire County Council; and

·         of the 9,459 people who had not yet received a statement on 14 November for the 2015/16 year, 2,572 had not received a statement for the previous year, representing 13.3% of active members. 655 members (3%) were missing more than 2 statements whilst 193 had not received one since annual benefit statements had been introduced in 2005. This group presented the biggest challenge in trying to resolve, given the passage of time since the initial query.

Mr Collins then explained what measures had been taken to address the above concerns:

(a)  the Committee had agreed to increase staffing in OCC Pensions by 5.81fte staff. This would enable a team to be established specifically to work with employers, to ensure earlier intervention where accurate data was not received regularly on a timely basis;

(b)  officers were reviewing the way data was asked for from employers, seeking a more standard, automated approach which would assist in a better flow;

(c)   more training and support was to be given to employers in a bid to improve the process as a whole.

(d)  The escalation process would be reviewed to ensure earlier escalation to senior staff in employers; and

(e)   summary data would be brought to the Board so that it could hold the Committee to account if there were concerns.

Mr Collins asked the Board how it would like to see the data, including the number of records deemed to be accurate and key reasons/employers behind incomplete or inaccurate records. A Board member asked whether other annual data checks could be utilised to find out, for example why a record had been suspended for more than a year. Mr Collins responded that contracts were already in place with the electoral registration offices and other providers were used also, for example, to find missing people. Officers were also working more closely with the County’s Registration Service. 

Mr Collins confirmed that the Pensions Service was now looking to claim costs for the reworking of statistics in accordance with the Committee’s Administration Strategy. The Chairman of the Pension Fund Committee had also undertaken to be involved in the escalation process. He added that these were part of a combination of factors to be considered with a view to ensuring that the employers take problems seriously.

Mr Collins confirmed that a realistic target, if the key employers were to be concentrated on, would be 70% - 80% of the 2016/17 statements sent by the statutory deadline of the end of August 2017.

The Board made the following suggestions for the Committee to consider:

·         To establish a set of Performance Indicators (PIs) for employers, in order to strengthen the importance of correct submissions of data. If the PIs were not met, then the Board could invite particular employers to meetings;

·         A report be submitted to the Board clarifying where Oxfordshire Pension Fund was in relation to other Pension Funds, perhaps to start with other authorities within the Brunel Partnership;

·         The Board requested to see what was being reported to the Pension Regulator;

·         To suggest to the Pension Fund Committee that it liaises with other Pension Fund Committees, asking what was the level of tolerance, the level of risk they were prepared to accept and how many checks were made.

Mr Collins stated that as the Brunel Pension Partnership was developed, the Pension Fund Committee’s Agenda would be freed up so that more attention could be given to the above issues. He reminded the Board that if liability was not understood, then there was a danger that the asset allocation would be incorrect.

The Board was asked what it would like to see in the administration report in the future. The response was as follows:

·         To include comparative data when available, as detailed above. This would be easily available from the Brunel Group to begin with. Mr Collins agreed that the Brunel Group could be used as it would give a good cross-section of practices, some authorities having already automated some of their data collection processes;

·         What data was accepted, what wasn’t and risks and tolerances in order to ensure that the escalation process was working properly.

The Board felt it important to notify members of the LGPS of the reasons why their statement was late. Mr Collins agreed to implement this stating that it would encourage correct returns.