Agenda item

The Head of Pensions introduced the report to the Committee and highlighted the following points.

·  The 3-year plan & budget for 2026-29 presented is prepared annually on a 3-year rolling basis.

·  The Fund aims to achieve the following objectives during 2026-29:

·  Service

o  Continue to improve service experience for members and employers.

o  Raise operational efficiency to enable lower unit costs, by increasingly deploying new software and digital integration.

·  Investments & Funding

o  Execute new pooling arrangements, moving assets from Brunel to LPPI.

o  Review our investment strategy, seeking to improve the risk / return mix and raise the probability of future contribution reductions for employers.

o  Accelerate investment in Local Impact, with such assets rising to £300m.

o  Invest in Natural Capital to drive positive environmental impacts.

·  Foundations: we also need to get the basics right:

o  Meet all our regulatory obligations.

o  Improve skills among both officers and Board / Committee members.

o  Identify, measure, and mitigate risks.

o  Manage within the budget set by the Pension Committee.

o  Support staff wellbeing and access to resource tools and training.

·  Budget for 2026-29

o  The aggregate budget for 2026-27 of £35.4m is £0.8m (2%) higher than the £34.6m budget of 2025-26.

o  Administration & governance costs in 2026-27 are £0.3m lower than 2025-26, driven by the triennial valuation of 2025-26 not being repeated, offset by pension administration software full year costs and Local Authority pay awards.

o  Investment management fees of £25.8m are £1.1m higher than the £24.7m budget of 2025-26. As a percentage of forecast assets under management, this represents a 0.01% increase to 0.40%. The estimated fees assume there is no change in asset allocation during the year.

o  Expenditure for the current year 2025-26 is predicted to be within budget, with a predicted underspend of > £200k.

The Pensions Operations Manager introduced the Administration Update to the Committee and highlighted the following areas.

SLA monthly performance average January 2025 to January 2026

• Dips in performance were seen in March / April 2025, recent figures of 89% (Jan), 94% (Feb) and 92% (March) were encouraging.

2025 and beyond – key priorities achieved

·  People: Fully resourced / Fully trained / Ongoing development and opportunities = Excellent progress.

·  Performance: Within SLA for all KPIs / Meet needs of Pensions Dashboards / Compliance with regulatory changes i.e. McCloud = Excellent Progress.

·  Process: Effective controls, proportionate to risk / Consistent processes / Clear and concise user guides & training = Improvement started.

·  Digital Transformation: Member portal upgrade to unlock the digitalisation of processes / Transition to hosting solution / Increased member engagement via portal = Improvement started.

2026-27 focus – member experience & operational efficiency

·  Maximise member portal sign-ups

·  Prepare for Dashboard public launch

·  Comply with regulations (McCloud, Access)

·  Move member journeys online - building block approach

·  Continue process improvements - operational efficiency & risk control

The Pensions Operations Manager asked the Committee to also note the Communications Strategy for 2026.

Jackie Peel referred to the KPI’s case by age % - Jan 2025 to Jan 2026 and asked if the cases outstanding +31 days were continuing to go up.

The Pensions Operations Manager replied that there had been a slight blip, but figures had now reduced and were continuing to improve.

Wendy Weston commented that it was good to see that the Fund budget was due to be underspent for 2025/26 and asked if this was due to staff vacancies and if so, did this put additional pressure on staff in place.

The Head of Pensions replied that he believed that there was an assumption that the Fund could still operate within its means on a vacancy rate of 3-4%. He added that only a few years ago the Fund had a vacancy rate of between 15-20%.

Councillor Fi Hance asked if there was a timeframe for implementation of the proposals from the Access & Protection Consultation, in particular that elected members will be eligible for membership (on an opt-in basis) with effect from 11 May 2026.

The Pensions Operations Manager replied that this would vary according to the proposal, but said that preparations were being made for elected members to join.

The Chair, on behalf of the Committee, thanked all officers for their ongoing work.

The Committee RESOLVED to:

i) Approve the 3 Year Plan & Budget 2026-29 for the Avon Pension Fund.

ii) Note the administration performance to the period ending 31st January 2026

iii) Note the Communications Strategy for 2026.