Agenda item

The purpose of this report is to present the Fund’s administration performance for the three months to 31st March 2024 vs key performance indicators (KPI’s).

The Pensions Operations Manager introduced the report to the Board and the following points were highlighted from it.

·  Recruitment for the two key posts of Employer Services Manager and Member Service Manager are under way.

·  McCloud: Awaiting guidance from the Scheme Advisory Board (SAB) with respect to the application of the McCloud remedy. This is now expected to be issued following the General Election (4^th July). Early reporting suggests the fund has c1,000 members that will require the remedy.

·  GMP: The fund is in the final stages of reviewing the Mercer closure report for member reconciliation. 5,150 remain outstanding as “stalemate cases” out of a population of 91,369 members, (a reduction of 8,916 previously reported to the Board in February 2024). The review will aim to be completed in July and we plan to bring recommendations to Board & Committee in September.

·  Process Controls: The fund is working with an external consultancy company to carry out a piece of work to map and review existing processes and relevant controls. The initial project will review the top 15 processes based on risk. The review is due to complete at the end of June and a full report will be brought to Board in September.

The Chair asked to what extent could officers see Altair taking steps to improve some of the controls or how they will use their best practice guidance to attempt to improve processes.

The Pensions Payroll Manager replied that Heywood’s have a core product and that when a new release occurs, the guidance notes relate to that specific moment in time. She added that there is a ‘Help’ function within the product and that if you know enough about what you are looking for you could find some best practice guidance.

The Chair said that he believed that as they support around 60 Funds they should act as more of a conduit to help finding solutions.

The Pensions Operations Manager commented that she and other officers would be attending an AGM next month and hoped to have further discussions on this matter. She added that previously she had asked for a core leaver form to be created for employers to directly access and was told that it would not be possible as every fund would want different elements included within the form.

Stuart Anstead commented that he would expect there to be a number of possibilities to use AI in some way that would help with processing mainstream tasks.

The Chair referred to GMP and asked that when the analysis takes place for the Fund to consider whether they do implement any possible reductions or simply find a way of identifying / quantifying it, so as to not then pay any beneficiaries and therefore know it is a true cost, rather than the likely upset it would cost if the money were to removed.

The Pensions Operations Manager said that she was in agreement with that sentiment, but there was still a process for the Fund to go through.

·  2024-year end is ongoing with data being validated from employers. The fund is on track to complete its annual benefit statement obligations for 2024.

The Pensions Operations Manager gave an additional presentation to the Board, a copy of which can be found as an online appendix to these minutes and a summary is set out below.

Re-structure

·  45-day consultation began on 30th May 2024, ends 14th July 2024. New structure to create new teams – Digital Services, Member Contact Team & Payroll.

·  Structure will create capacity for the operational teams and support for business change and digital transformation. Increasing from 83 to 94 FTE across APF, overall increase of 11 FTE, 8 within Operations.

The Chair asked how staff were feeling about the proposed changes and the culture behind supporting them through the process.

The Pensions Operations Manager replied that a large team meeting was held to announce the re-structure and ongoing support was available to staff to talk through any issues they may have. She added that Korn Ferry have provided evaluations on the old job descriptions and said that through the process of moving to role profiles a lot of the team were likely to see an increase in pay.

She said that the new structure would also open up more opportunities for promotion.

The Chair asked if staff were willing to make the changes work and understood why they were being proposed.

The Pensions Operations Manager replied that she thought that they were and that messages regarding the changes were included in their monthly updates and have been for some time. She said that it was an important step to take to enable services to be delivered in the future.

The Pensions Payroll Manager added that she felt that the teams are feeling engaged and that there was a sense of positivity overall, especially regarding pay and the formalising of roles.

Helen Ball asked when it would be known how many job vacancies will exist under the new structure.

The Pensions Operations Manager replied that this was likely to be towards the end of 2024.

McCloud – Pensions in-to payment from 1st October 2023 to 31st May 2024

·  From 925 normal (from active or deferred) pensions 18 (2%) have had the underpin applied resulting in an annual uplift of £6,735 which equates to £561 monthly.

·  From 204 dependant pensions there has been no need to apply the underpin.

 SLA – Performance average June 23 to May 2024

·  Figures are not improving much which is still due to the backlog of cases.

The Pensions Operations Manager explained to the Board that delays from individual fund members can lead to targets not being achieved and that this is not always within their control.

Stuart Anstead said that he felt that the Fund should be able to stop the clock in these particular scenarios.

Alison Wyatt asked if year end work has an effect on their performance figures.

The Pensions Operations Manager replied that it would not normally have too much of a detrimental effect.

KPI’s - cases outstanding under 31 days

·  1,601 as at 2^nd June 2024

KPI’s - cases outstanding over 31 days

·  734 as at 2nd June 2024

Service performance – plan v’s actual

·  Good progress being made – deliver sooner if possible.

The Technical and Compliance Manager addressed the Board and provided them with an update on the Pensions Increase.

Phase 1 is complete

·  Remediated 801 members using Retro PI process:

·  696 members paid arrears/interest and corrected their monthly pensions going forward (645 LGPS and 51 Teachers).

·  105 members fixed in readiness for 2024 PI.

Lessons learned - Phase 1

·  We have improved our knowledge of the PI annual process. Heywood support has been invaluable and effective.

·  Communication with the APF Committee, Pension Board, Council and within the APF project team has been constructive.

·  We achieved the Phase 1 timeline within the hard deadline imposed by the 2024 PI run.

The Chair asked for clarification on the progress of the supplementary PI issue for lump sums.

The Technical and Compliance Manager replied that they were still awaiting confirmation from Heywood on a system fix, for it was an issue that affected all Heywood users. The Pensions Payroll Manager confirmed that the system fix was in the latest software release and was in the process of being tested.

Future Phases plan

·  Population

• Cases are more complex than Phase 1 and require deeper analysis.

• Not all of population will require remediation.

·  Approach

•    Technical Manager to lead project and will from part of teams BAU project work.

•  Likely to be more resource intensive for manual calculations.

•   Use full end-to-end bulk remediation process where possible – run smaller batches with similar profiles once analysis and any correction work complete.

•  Aiming to address all cases by end 2024.

Stuart Anstead asked if checks would take place following manual calculations.

The Technical and Compliance Manager replied that they would.

The Chair said that members of the Board project group would be keen to learn progress in between meeting cycles and would be willing to help further, in terms of pragmatism -v- process.

The Board RESOLVED to note the service performance for the period ending 31st March 2024.