Agenda, decisions and minutes

To receive any Declarations and advise Members accordingly.

There were no new declarations of interest.

The Chair invited attendees to declare any potential conflicts of interest that they may have in relation to the Fund, other than those already recorded in the Fund’s register.

There were no new declarations of interest.

To confirm as a correct record the minutes of the last meeting held on the 29 November 2023.

The minutes of 29 November 2023 were received, approved, and will be signed by the Chairman.

The minutes of the meeting of the Committee held on 29 November were agreed.

RESOLVED:

The minutes of 29 November 2023 were received, approved, and will be signed by the Chairman.

a)      The Committee considered and commented on the update.

b)      The Committee reviewed and approved the newly created Clwyd Pension Fund EDI Policy

            Mr Latham took the Committee through each paragraph of this report, including progress against the business plan and current developments including the Pension Regulator’s (TPR) new General Code of Practice and the update from the Scheme Advisory Board (SAB).

            Mr Middleman of Mercer explained that the statement from SAB on LGPS surpluses was broadly as anticipated and is consistent with the way CPF’s funding strategy addresses surplus which is centred on contribution sustainability in the long term. The statement raises potential conflicts of interest when setting contribution rates. He explained that through its strong governance structure and dialogue with the main employers, the Fund ensures these potential conflicts are well managed and considered by officers and Committee. Other key parts of the statement included employer specific investment strategies where employers are exiting funds, and partial terminations where employers remove part of their liability. These issues are less relevant for the Fund principally because the majority of CPF employers are public sector bodies who are not expected to exit the Fund. However, if this becomes an issue in future, the matter will be brought to Committee for consideration.

            Mr Hibbert commented that Central Government appears to incorrectly view LGPS surpluses as a means of reducing Council Tax and as a pot of money for Government to direct. He noted the language used around the Government wishing not to direct funds on how or what to invest in, but to make general suggestions. He felt that if the Government provides an environment in which investments can grow, the Fund will find them and invest in them where suitable.

            Cllr Shallcross asked whether the ‘line’ between surplus and deficit had been moved to reflect the growing pot size needed to provide pensions for the aging population. Mr Middleman confirmed that when funding strategy is looked at and contributions are set, life expectancy and the aging population are taken into account to ensure the funding available is appropriate to meet these needs. He noted that the rate of growth of life expectancy is currently reducing based on latest data, which will be a discussion point to consider at the next valuation and will be picked up later this year as part of the interim funding review.

            Mr Latham handed to Mr Turner who explained the paragraph on Sharia Law. Mr Turner said it is useful to have this issue clarified by SAB, and though further advice is still to be delivered, there is expected to be minimal impact on the Fund’s investments. Concerns around Sharia Law are typically a concern for defined contribution pensions and Sharia compliant investment options can be offered in these schemes. However, this solution does not apply to the way LGPS funds invest. The clarification from SAB and the legal opinion will provide useful guidance in this area.

            Mrs McWilliam asked whether Sharia Law had ever been considered as part of the Fund’s AVC fund choices, and whether it should be. Mr Turner was not aware of this having been  ...  view the full minutes text for item 38.

(a)     The Committee considered and commented on the update.

(b)     The Committee approved the amendments to the Pensions Administration Strategy as highlighted in paragraph 1.04 and Appendix 4 which incorporate the updated key performance indicators.

Mrs K Williams took the Committee through each paragraph of this report. She highlighted:

-       Progress on the National Pensions Dashboard project

-       Employer Liaison Team (ELT) and the McCloud project. From employers using the ELT service, 100% of McCloud data has now been provided and 54% of this has been successfully uploaded. Of employers not using this service, 78% of data has been received, and 56% has been uploaded. McCloud now affects day-to-day internal processes as additional checks need to be made, and this could impact KPIs in future.

-       Data cleansing exercises including an address cleansing exercise, and triennial existence checks which take place for members living overseas as part of the anti-fraud and corruption policy.

-       The Fund receives over 24,000 telephone calls annually, and it is proposed that a telephone help desk be set up to direct members to the right officer and help to address Welsh language standards. Mrs McWilliam asked if the telephone statistics include calls to mobile phones. Mrs Williams explained that calls to office phone numbers will be counted, even if they are diverted to a mobile through the Avaya system. Calls to a direct mobile number would not be counted in these statistics, for example if an officer makes an external phone call from their mobile without using the Avaya system, the member could then call back using the direct mobile number. However, this is very unusual, and the majority of phone calls do go through the Avaya system.

-       The Fund sends monthly reports to employers informing them of their performance in relation to the 3 main KPIs. Originally, these reports were intended to inform and support the employers to put resources in place and improve processes, however an audit review raised a concern that progress was not being made and recommended that the Fund should look at enforcing its escalation policy for employers continually missing KPI targets. The Fund's preference is to help employers identify areas of improvement and share good practice rather than impose fines. The escalation policy is being revised to reflect this, and part of the revision is updating KPIs within the administration strategy.

-       Workload statistics, and resource and staffing updates.

-       An update on communications including employer engagement sessions. Employers’ feedback on the format of the annual meeting will be presented to Committee when it has been collated.

RESOLVED:

(a)     The Committee considered and commented on the update.

(b)     The Committee approved the amendments to the Pensions Administration Strategy as highlighted in paragraph 1.04 and Appendix 4 which incorporate the updated key performance indicators.

The Chair asked the Committee to note the following future Committee meeting dates:

-       Wednesday 20 March 2024

-       Wednesday 19 June 2024

RESOLVED:

The Committee noted the upcoming Committee dates.