ITEM PF13
PENSION
FUND COMMITTEE – 24 MAY 2002
REPRESENTATION
ON THE PENSION FUND COMMITTEE
Report by
the Director for Business Support and Assistant Chief Executive
Introduction
- The Finance &
General Purposes Sub-Committee agreed in March 1986 to invite a representative
of the beneficiaries to attend and speak at meetings of the Investment
Sub-Committee. A proposal to select the representative by a ballot of
the contributors and beneficiaries was defeated presumably because of
the practical problems and administrative cost as outlined in the report.
- It was agreed
that the union representing the majority of current employees and pensioners
be asked to nominate a representative. This was suggested as a practical
solution that would lead to the ‘nomination of an individual who would
be capable of reflecting and representing the views of the widest possible
spread of beneficiaries’. It was however stressed that the union was
being asked for assistance to identify someone to represent their members,
not to represent the unions.
- Unison (NALGO)
was identified as the largest union and the Oxfordshire County Branch
of Unison was chosen to nominate the representative because it was the
largest branch. There have been three representatives since 1986, including
the present incumbent, and all were selected by the Oxfordshire County
Branch. There is no agreed term of office so Mr Leeding has carried
out this role since being nominated some ten years ago. At the time
of appointment Mr Leeding was working in the Chief Executives office
and was an honorary union official dealing, among other things, with
service conditions.
- There have never
been any terms and conditions attached to this appointment, although
the title ‘Beneficiaries Observer’ gives some clue to the intention
of the role. The Beneficiaries Observer has no legal status, he/she
cannot be a member of the Pension Fund Committee and cannot vote or
take part in decision-making.
Practice in other county
pension funds
- The United Kingdom
Steering Committee on Local Government Pensions issued a circular on
the Principles of Good Practice for the Management of Schemes (circular
59 December 1997). The suggested good practice on representation was
that consideration be given to extending scheme member involvement by
allowing scheme members to have observer status. This practice is now
widespread. All but six of the thirty-four county schemes surveyed have
some arrangement for a beneficiaries observer. The position is mostly
described as a ‘Trades Union Representative’ and in some cases there
are more than one representative. A detailed questionnaire was sent
to nineteen county councils and nine responses were received. One of
the responses indicated that the observer was not union-affiliated.
- The following
observations can be drawn from the eight responses with union-affiliated
observers:
- In seven of
the eight counties the observer is appointed by the regional trades
union(s)
- All appointments
are by nomination rather than ballot
- The appointment
is reviewed on an irregular or ad hoc basis except in one case where
the appointment is quadrennial
- The appointments
are non-voting
- Only two counties
have formal duties and responsibilities and in both cases these are
set by the trades union not the administering authority.
- The counties were
also asked to state which group most accurately described who the observer
was representing. The responses were as follows:
- Trade Union
Members – 3
- Active Members
– 2 (one of which mentioned a separate pensioner representative
- Retired member
– 0
- All members
– 2
- The overall conclusion
is that the appointments are ad hoc and Oxfordshire is not out of line
with the practice of other county pension schemes.
Application from Oxford
City Branch of Unison
- The Council has
received two letters from the secretary of the City Branch of Unison.
Copies of the letters are attached to this report at Annex 1. The second
letter dated 18 March 2002 makes it clear that the application is for
‘Unison representation on the Pension Committee’ and that ‘it would
be for Unison to determine who filled that place or places’. The Secretary
also makes it clear that ‘we are not seeking a reserved place solely
for my branch’. These statements do however conflict with his later
statement that Unison should have full representation rights.
- The letters were
considered by the Group on Organisation and Democracy on the 11 March
2002. The Group was informed by the Assistant Chief Executive/Solicitor
to the Council that it would not be appropriate from a legal point of
view to have Unison representation on the Pension Committee. The Group
referred the matter to this Committee.
- Taking the letters
at face value, the Unison City Branch is asking for a form of scheme
member representation that already exists. This has been ably carried
out by Mr Leeding and his many tasks include:
- attending Pensions
Committee;
- producing a
quarterly report that is sent to Unison stewards, all union branches
in the District Councils and Brookes University, County Chief Officers
(via personnel network), all personnel officers in district councils,
Brookes and colleges, all other employing bodies and the Unison county
retired members group;
- attending the
pension user group;
- attending the
Annual Forum.
- However, Mr Leeding
is clearly not representing Unison although he was originally appointed
by the Union. There is also no provision for reviewing the appointment
once made.
Conclusion
- There is no reason
to change the present arrangements and the Committee should confirm
its present policy of having an observer representing all beneficiaries
including non-union members and pensioners.
- The Committee
may wish to consider having more than one observer in order to cover
all interests although this is not recommended.
- The appointment
should be nominated by Unison, either by the regional office or by the
Oxfordshire Branch, which has the largest membership.
- The Committee
should formalise the terms and conditions of the appointment in order
to clarify the role.
RECOMMENDATION
- The Committee
is RECOMMENDED to:
- confirm
the present policy of inviting an observer to attend Committee
meetings in order to represent the beneficiaries and pensioners,
and;
- ask
the officers to formalise the terms and conditions of this appointment,
in consultation with Unison, and report on these arrangements
to a future meeting of this Committee.
CHRIS
GRAY
Director for Business Support
CHRIS
IMPEY
Assistant Chief
Executive
Background
Papers: NIL
Contact
Officer: Barry Phillips, Senior Assistant County Treasurer Tel:
(01865) 810805
May
2002
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