Agenda item

The Board is invited to review the position against the Annual Business Plan for 2022/23 and the Annual Business Plan for 2023/24 as considered by the Pension Fund Committee at its meeting on 3 March 2023 and to offer any comments to the Committee. 

The Board was asked to review the position against the Annual Business Plan for 2022/23 and the Plan for the new financial year as considered by the Pension Fund Committee at their meeting on 3 March 2023 and to offer any comments to the Committee.

The officer discussed the progress of the main four main objectives for the last financial year.  When discussing the first objective (Review and Improve the Scheme’s Data), It was noted that 2 of the KPI’s were green and 3 were amber.  The officer advised that reasonable progress had been made against the priorities, However, some areas had not made any real progress, i.e., developing data for the standard service KPI’s to be included in the quarterly performance reports, so the score against this outcome was amber.

Progress against cyber risk and data security was noted. Cyber risk had retained an amber rating considering the breaches already reported this year, and the need to strengthen the monitoring arrangements in respect of the wider cyber risks.

The officer informed the Board of progress against the second objective (The development of the approach to technology), and the decision to extend the contract with Heywood's and that the amber indicator (Use of the online services) was to be carried forward into the new year.

In terms of the third objective (Enhanced Delivery of Responsible Investment responsibilities) the officer informed the Board that it was largely green, with one red area where no progress had been made around the stewardship code.  It was noted that this was largely as a result of not recruiting the responsible investment officer at the start of the financial year and not having the capacity to do the work.

The officer informed the Board that the area with the poorest performance against the objectives was the fourth objective (Deliver improved and consistent service performance to scheme members). In terms of service performance, the officer advised the Board that it was partly because of wanting to make sure the service would operate at the right level throughout the year.  The officer reminded the Board that the indicator had started the year in red, and from the outset was going to be difficult to achieve.

The officer advised the Board that the indicator ‘All services delivered in line with regulatory guidance’ was amber and was largely outside the control of officers as they had spent all year waiting for government guidance on the McCloud, pooling and TCFD which did not materialise.  The officers noted that they were unable to progress the task because the government had not provided the guidance to do so.

The last area was around the scheme engagement policy. The Board was advised that whilst one member of staff had been employed the final member of the Governance and Communications team had not yet been recruited, so work would continue during the new financial year.  The indicator scored amber because it did not make much progress.

The officers noted an underspend in terms of the budget for the delivery of those services which was largely as the consequence of the lack of staff and the vacancies held during the year, which in turn impacted on the ability to deliver some of that work.

The Board noted that central government had now released the McCloud guidance with a note advising that further resources would be needed along with a recommendation to set up a resourcing plan; the Board asked if a resourcing plan had been created. 

The officer advised the Board that some guidance had been received, but not the full guidance.  It was noted that the regulations would be released on 30 September to be implemented from the day after (1st of October).  In terms of resources, the Board was updated on the current successful recruitment campaign which included some temporary staff.  Officers confirmed that a resource plan was in place and just required finalising with HR, the officers agreed to share the resourcing plan with the Board.

The Board was informed that there would not be any funding from central government to help affect the remedies in the pension funds.  The Board discussed the court cases the Unions brought to challenging the cost cap.  The cases were unsuccessful, but the Unions would look to appeal the decisions, leading to a further period of uncertainty over benefit calculations.

The Board reviewed the forward plan in the second section of the report.  The officer noted that the 2023/24 business planning workshop which all the Board members attended.  The Board were advised that their comments had been reflected in the overall objectives of the Business plan.  He noted that the main job of the Pension Fund Committee is to pay pensions as and when they are due and to minimise the cost to the stakeholders.

The Board discussed the delivery of all the regulatory changes and the governance arrangements for the fund.  The Board also raised a query about the review of the administration strategy.  The officer advised the Board that a report on the breaches Policy would be brought to the June Committee.  The officer also informed the Board that the responsible investments and stewardship code report would be brought to the June Committee.

The Officer advised the Board that regarding making further improvements to technology, several workshops had been held with Heywood’s to maximise the full capabilities of their systems.  The Board raised a query regarding the breaches policy and reporting arrangements.  The officers agreed to bring the review of the breach policy back to the Board.  The Officers also confirmed that Board members would be invited to the Pre-Committee training. 

The Board noted the report and:

1)    That the Committee noted the progress against the service priorities for 2022/23;

2)    That the Committee approved the Business Plan and Budget for 2023/24 as set out at Annex 1;

3)    That the Committee approved the Pension Fund Cash Management Strategy for 2023/24.

4)    That the Committee delegated authority to the Director of Finance to make changes necessary to the Pension Fund Cash Management Strategy during the year, in line with changes to the County Council’s Treasury Management Strategy;

5)    That the Committee delegated authority to the Director of Finance to open separate pension fund bank, deposit and investment accounts as appropriate;

6)    That the Committee delegated authority to the Director of Finance to borrow money for the pension fund in accordance with the regulations.