Agenda item


The Pension Fund Committee met on 20 December 2019. This report provides a summary of this meeting and any resolutions made.




Neil Mason, Strategic Finance Manager (Pensions)

Nick Weaver, Head of Pensions Administration

Anna D’Alessandro, Director - Corporate Finance


Key points raised in the discussion:


  1. The Chairman noted that risk A22 on the Council’s move out of County Hall was graded Red at the last Pension Fund Committee but had since been changed to Amber, recognising that efforts were being made to secure accommodation for the Pensions Administration team  at a location close to County Hall.
  2. Responding to a Member query, the Strategic Finance Manager (Pensions) explained that moving the administration to a new location did not pose any special logistical risks because it was already ring-fenced from the other elements of Orbis. The Head of Pensions added that it was important to house the Helpdesk and the administration function in the same building in order to facilitate cooperation and maintain a good working relationship.
  3. In response to a Member query on the timescale of the move, the Director - Corporate Finance stated that the move was not imminent and explained that there was an options appraisal with Property Services later in the year to further discuss the logistics of the move. Finalisation of which directorates were moving to the new civic heart in Woking and those which would be dispersed around existing sites remained outstanding.
  4. The Strategic Finance Manager (Pensions) discussed the review of governance in the LGPS by the Standards and Outcomes Workstream and the Compliance and Improvement Workstream working groups and how the Fund was meeting the recommendations of SAB in order to develop Phase III of the ‘Good Governance’ report which would go to SAB next month.
  5. To increase accountability, the Strategic Finance Manager (Pensions) explained that the ‘Good governance in the LGPS’ report identified the proposal for each administering authority to have a single named officer - ‘the LGPS senior officer’ - who was responsible for the delivery of the pension function. That may be a relevant senior officer with good knowledge of the pension function and, even if it was the Section 151 officer, a change to the constitution would be needed.
  6. The Strategic Finance Manager (Pensions) positively noted the introduction of the requirement for s151 officers to carry out LGPS relevant training which would ensure a good level of knowledge and understanding to be passed between the Board, SAB and Pension Fund Committee.
  7. Discussing the recently approved Council budget, the Strategic Finance Manager (Pensions) emphasised that the Surrey Pension Fund budget was ring-fenced from it. In response, the Chairman noted that it was good practice to separate the employing authority from the administering authority and requested that training for Members of the Board and Fund Committee be run alongside each other.
  8. The Strategic Finance Manager (Pensions) provided an update on the 2019 Valuation noting changes from 2016 to the Funding Strategy Statement (FSS), including colleges and higher education institutions which were adversely affected by the decrease in their recovery periods and treated similarly to private companies. He explained that the Pension Fund team were in consultation with the Department for Education on the matter and the affected colleges and admission bodies, with the change to come into effect on 1 April 2020. In response to Members, the solution was not one size fits all with the affected colleges and admission bodies and the priority was the Fund’s wider solvency.
  9. Responding to a Member query on the differences in engagement between the Board and Fund Committee, and Border to Coast (BCPP) with their scheme members and employers, the Strategic Finance Manager (Pensions) explained that pooling companies such as BCPP were asset managers and not decision-makers - unlike Members of the Board and Fund Committee which had representation on BCPP joint committee meetings.
  10. The Chairman commented that each local authority managed its own strategic decision-making and the Strategic Finance Manager (Pensions) noted that revised guidance on pooling from Government detailed the level of discretion that pension funds retained. The Strategic Finance Manager (Pensions) stated that there were clear benefits for the Fund to pool with the larger resources available within BCPP.
  11. A Member queried the McCloud judgement which affected actuarial improvements being returned to employers and the Strategic Finance Manager (Pensions) responded that no remedy had been decided regarding McCloud but given that the older scheme with an accrual rate of 1/60th it was inherently less generous than the new in the 1/49th scheme and only the few members who had significant pay increases would benefit from the underpin. The guarantee of the current underpin expires in 2022, in itself, would not have a material effect on the liabilities - there would be minor additional charges.
  12. The Strategic Finance Manager (Pensions) informed the Board that the Pension Fund Committee was reviewing the Fund’s own Responsible Investment (RI) Policy to develop its core investment beliefs, balancing good returns and responsible investment - spectrum of capital. The Fund’s RI would be assessed in relation to the spectrum of capital and the selected areas within the 17 UN Sustainable Development Goals with progress on the matter to be provided at the next meeting of the Board.
  13. In response to a Member, the Strategic Finance Manager (Pensions) noted that the Pension Fund team and Members of the Committee were engaging with the action group Divest Surrey which was affiliated with Extinction Rebellion, to inform them of the Fund’s RI approach.
  14. The Chairman reported that the draft Administration Strategy had been approved and the Strategic Finance Manager (Pensions) added that the consultation on the strategy with scheme employers had been extended.




The Board noted the content of this report.


Actions/further information to be provided:


  1. That Members of the Board and Fund Committee have future training alongside each other.
  2. The Board to receive an update on the Fund’s own Responsible Investment (RI) Policy at its next meeting.



Supporting documents: