Agenda item

The Head of Business, Finance and Pensions presented the report.

He said that the some of the key issues facing the Fund in the next three years were:

• pooling – the Committee had already agreed to provide additional resources, but there were the as-yet-unknown costs of implementation, which were not reflected in the Budget and Service Plan

• following the 2016 Budget, an acceleration in the Academies programme, resulting in the possible creation of 293 additional Academies, each of which could be a separate employer; there would be additional work in securing administrative compliance and in training; recruitment for additional posts would take place this year.  It would help the Fund if schools becoming Academies joined Multi Academy Trusts.

• the valuation

It was proposed to create specific member and employer focussed services within the Administration team.

Staff turnover had been, and was likely to remain, a serious concern.

Members discussed the report and made comments and asked questions, to which officers responded

Staff retention

Could retention allowances be paid to staff?

There would need to be discussion with the Council’s Human Resources Team. In the meantime attention will be given to job grading and flexibility.

How many apprentices are working in the Administration Team?

There are two at present, which will be doubled to four.

Increase in employers

The admission of Academies and the increase in employers will raise costs for the Fund. The Fund should investigate whether there were best practice models for dealing with Academies. A higher quality of data is demanded by the CARE scheme.

0.4% of employer contributions are earmarked for administration costs. This might not be enough, and will have to be examined as part of the valuation process. A great deal more is now being spent on compliance and regulation. In accordance with the Administration Policy, charges will be levied on employers who impose excessive additional administrative burdens. Efforts will be made to identify more efficient practices that employers could adopt, and consideration given to charging them supplementary fees if they fail to adopt them. As for best practice, administration staff visit schools about to become Academies and give training and help with thepensions software systems. The Fund needs smarter technology; discussions are ongoing with software suppliers about how to manage the increase in employers. All funds are facing the same issue. 53% of smaller employers are now sending data electronically. Member self-service needs to be encouraged to free up staff resources. Currently 10,000 scheme members are signed up for self-service; this needs to be increased to at least 80,000. The new member website will be launched next week.

Investment Strategy

The review of the Investment Strategy has been delayed because of work on pooling. The original target date was September 2016. There was a suggestion that there would be no new investments until the new Strategy had been agreed. There are serious issues in relation to the new Strategy that might not be resolved for many months. Would it be possible to agree an interim Investment Strategy?

The review of Responsible Investing Policy is due to complete as planned. Following the valuation the Investment Strategy will need to be reviewed for the change in the liabilitiy profile and this is due to take place early in 2017.  The review of Responsible Investing Policy must be done thoroughly and cover all aspects and needs to take into account of what may be possible from pooling.

Transfer of Fire Rescue Service funding from DCLG to Home Office and merger of Police and Fire Service

The Fire Brigade Pension Scheme is an entirely separate scheme; Avon only administers it. Avon could continue to administer it, or the administration could be transferred to another organisation.

RESOLVED to approve the 3-year Service Plan and Budget for 2016-19 for the Avon Pension Fund.