Agenda item

The Board received a report from the Director of Corporate Resources concerning administration of Fund benefits, including the performance of the Pension Section against its performance indicators. A copy of the report marked ‘Agenda Item 5’ is filed with these minutes.

Arsing from the discussion the following points were made:-

i.            There was concern that despite officers persistence, Aspens (Crown Hills), Caterlink, Cleantec and Mellors Catering had outstanding bond or admission agreements It was believed the delay was due to lack of prioritisation from the bond company. The Pensions Manager would write to each party to remind them of their duty to form a bond or admission agreement.

ii.           The Pensions Manager had added ‘Transfers Out’ and ‘Refunds’ to the workload report. This was due to an expected rise in members requesting transfers out and members with under two years membership of the scheme opting out to claim refunds as a result of COVID-19 and Government’s furlough scheme due to members looking to gain additional income to support them through potential financial difficulties.

iii.          While most key performance indicators were within normal levels, aggregations had exceeded the Fund’s maximum case number. Members were assured that work was ongoing and that aggregations were moving towards pre-COVID levels.  However, as a result of the McCloud ruling, and the potential need to re-aggregate cases it was likely to become a higher demand area. It was suggested a training session take place following a future meeting of the Board to further explain the potential impact the McCloud and Sargeant ruling might have on the Fund.

iv.         Three new staff members were due to start in September to aid resource within the section. Training would continue to take place with all staff members and involved a mixture of online and in-person training dependent on the subject matter. A buddy system had also been set up to assist new and existing staff members.

v.           In the Board’s role as regulatory body for the Leicestershire Pension Fund Members attention was brought to Government’s response to the 95k Exit Cap consultation. While the cap was primarily an employer issue it also impacted on the administration of the Fund in relation to the pension strain (costs that occurred when there is a clear shortfall in the assumed level of funding needed to provide an unreduced pension benefit, for example if a member drew their benefit a lot earlier than expected). From the Fund’s perspective the concern was that each LGPS pension fund set its own actuarial factors for the calculation for valuation exercises, if the exit cap was to come into force  it was likely national work would need to be undertaken across the four main actuaries to standardise pension strain calculations, to reduce inequity between funds. 

vi.         Ms. Haller raised a concern that the 95k exit cap could affect a lot of public sector workers, especially those who may have long service such as nurses and social workers if the cap was not linked to inflation. The Pension Manager assured the Board that he was aware employers were looking at the implications and that Unison were also lobbying against the cap in its current form. Nothing had yet changed in statute and any members of the fund who were concerned were encouraged to contact their employer.  Leicestershire County Council, for example, in its role as employer has responded to Government’s consultation, once set in statute a report would be taken to the County Council’s Employment Committee to set out any implications.

RESOLVED:

That the contents of the update be noted and that the Board undertake a briefing at the conclusion of the next Board Meeting regarding the impact of the McCloud and Sargeant rulings.