Agenda item

The purpose of this report is to notify the Local Pensions Board of the updated 3 Year Service Plan and Budget for the period 1 April 2021 to 31 March 2024.

The Pensions Manager introduced this report to the Board and highlighted the following areas from within it.

The Service Plan and Budget were formally approved by the Pensions Committee at its meeting in March 2021.

Resource Implications

Capacity within the Investments Team has now improved with the appointment of a Senior Investments Officer (SIO) in early 2021, with a specific focus on ESG and RI. A second SIO post remains vacant and is already provided for in the budget; further consideration will be given to filling this position once the team has bedded down and all legacy assets have transferred to Brunel (except those that cannot transfer and will be wound down by the Fund).

In respect of administration at the start of the pandemic a high number of posts remained unfilled. A phased recruitment programme has been in place over the past nine months to complete the establishment albeit with some slippage due to COVID and remote working.

Further recruitment to better structure the management team and support transformational needs of the service will be the introduced as part of the 2021/22 budget and operationally the administration resources will be considered during the year as part of the Administration Strategy review.

The 2021/22 budget allows for additional temporary resource to support the expected workload to manage the McCloud remedy, with the use of external specialist support as part of the ongoing solution to manage elements of specific project work.

Budget for 2021-24

The budget is split between those areas that relate to the administration of the Fund in terms of providing the administration service to members and employers, and those areas where there is less scope to directly control the costs. The budget also includes the estimated costs of the pension board. The LGPS regulations require the costs of local pension boards to be met by the local fund.

The budget approved for Administration in 2020/21 was £3.7m. The proposed

budget for 2021/2022 increases to £4.0m. The increase will include the

appointment of both a Transformation Manager and Project implementation officer and provide for the strengthening of the existing management team.

The previously planned IT system review budget has been removed pending the planned revision to the current Administration Strategy and it is envisaged that this will be presented to the Pensions Committee for consideration later in the year.

Administration

The most obvious outcome of moving to a solo homeworking environment is that all communication, engagement and operation now has to be timetabled and planned. With limited visibility there is increased pressure on the management team to ensure all operations are effectively maintained. Whilst longer term it is expected that digital tools will develop to support this, at present there is a reliance on increased management effort to sustain this position.

A number of developments have been paused as a result, but the need to now fully embrace digital operational capability provides a further logistical and management resource drain. Ensuring there remains sufficient management

focus in key areas is now a major challenge for the administration and it is recommended that the management team is strengthened in quite specific areas to accommodate this.

In addition, the creation of a core projects unit which could be flexed as major projects such as McCloud emerge, will mitigate the current risk of continually diluting operational resource.

The new operating environment also requires a new infrastructure to support it and whilst the service has adapted, the change is far from complete. The establishment of a Transformation function would give the issue real focus and impetus and incorporate the recently created training function, communications and importantly lead on all digital transformation.

Whilst this function is being established, a projects officer will be appointed

to kick start some of this work particularly digital service specification, digital office working including staff engagement and governance arrangements.

Helen Ball suggested that a review of the Service Plan could take place on a themed basis.

The Head of Business Finance & Pensions said that the Council were establishing a form of blended working where staff that need to access an office can, but they would mainly still work at home. He added that a review of office space / use was ongoing across the Council and that there was a need to now focus on ourselves as well as members and employers.

The Board noted the 3 Year Service Plan and Budget for 2021-24 for the Avon Pension Fund, including proposals to manage the transformation process.