Agenda item


The Board is asked to note the content of this report.


The Board is invited to consider rating of internal audit recommendations as they apply to the Pension Fund and the appropriateness of additional actions identified to be recommended to the Pension Fund Committee and agree the final form of a Local Pension Board Progress Report


The Board recommends that the pension administration team produce a further update report for the next Local Pension Board meeting.



Declarations of interest:





Jason Bailey, Pensions Lead Manager

Neil Mason, Senior Advisor (Pension Fund), Pensions and Treasury

Siva Sanmugarajah, Lead Auditor, Internal Audit


Key points raised during the discussion:


  1. Officers outlined the annexes provided, and explained the context of the internal audit report. It was highlighted that there was a distinction between the sovereignty of the Fund and that of Orbis as a service provider, and that the progress report was intended to reflect the Board’s areas of concern. Officers also asked that the Board note that the administration strategy and risk register, both of which were in development, would clarify roles and responsibilities in respect to Orbis and the Fund.


  1. The Board was informed that Internal Audit would be reviewing Orbis’ response to the recommendations, before a formal follow up audit was conducted in quarter four 2017/18. It was also noted that the Surrey Pension Fund Committee would consider the Board’s review on 15 September 2017, and the Surrey County Council Audit and Governance Committee would receive a progress report on 27 September 2017. Board members expressed some concern as to the duplication of process, and it was clarified that the Pension Fund Committee had asked the Board to review and lead with monitoring progress and responses from Orbis on behalf of the Fund.


  1. The Board expressed concern that it had frequently highlighted performance issues over the past 18 months, and had received assurances that there would be improvements. The internal audit report was highlighted as evidence that there were continued challenges in delivering sustained improvement.


  1. The Board noted that it had previously requested that any new business Orbis sought should be assessed on the basis of risk to current service delivery. The Chairman highlighted that he was to be informed if any new business was being tendered for, and advised of what impact this was likely to have.


  1. The Board questioned whether officers were confident that staff increases were sufficient to address identified backlogs. It was confirmed that there was an increase of 4-5 Full-Time Equivalents (FTE) in the team, and that this would be a short term measure to deliver the improvement work. Officers highlighted that the internal audit activity had been conducted through late 2016-17. It was also noted that the impact on benchmarking data would be seen in the 2017/18 figures.


  1. The Board queried what additional management capacity had been created to respond to the report’s recommendations. Officers highlighted that an operations manager had been assigned from another area of Orbis to review performance. It was also the case that additional executive support was being recruited to enable project oversight during a six month period.


  1. The Board commented that it did not have a sense of the project plan, current backlogs, proposed changes or timescales for improvement. It was reflected that this made it difficult to assess the extent to which the service had responded to the internal audit recommendations. Officers agreed to circulate an improvement plan, and noted that backlog volumes and expected clearance dates would be added to the key performance indicator reports for 2017/18. Officers commented that they would expect to see a reduction in backlogs over the course of the financial year.


  1. The Board was informed that the proposals to develop a pension administration risk register would support improved oversight. Officers were invited to identify specific areas of concern, and it was highlighted that there were continued concerns about performance within the Pension Services team. Officers noted that comparisons with the performance of the team based in Lewes had identified issues, and that individuals were being seconded to support the documentation and revision of work processes.


  1. The Board expressed that it wanted a clearer sense of the target dates for key outputs related to responding to the audit recommendations. It was also requested that areas of concern were highlighted through the response to the audit recommendations.


Actions/ further information to be provided:


The improvement project plan, with planned changes, outputs and timescales be provided to the Board.




That the Board note the report, and will continue to monitor progress until the follow up audit in quarter four 2017/18.



Supporting documents: