Local Pension Board - Thursday 2 July 2026, 8:03am

Local Pension Board
Thursday, 2nd July 2026 at 8:03am

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Disclaimer: This transcript was automatically generated, so it may contain errors. Please view the webcast to confirm whether the content is accurate.

now which is now live. So I can confirm, Chair, the only apologies for absence today will be from

John Deakins. Yep, lovely. Thank you very much. Thank you, Michael. Thank you for your support.

And welcome. Welcome along to the local pension board operations. And yeah, thank you for agreeing

to play a part in it. And welcome colleagues. And again, firstly, a special welcome to Namin for

joining this particular board and filling our vacancy we had. You're more than welcome.

Would you like to just give a brief introduction as to your background and your application for

becoming a member and the the pensions experience or otherwise that you may have, is that okay?

Yes, thank you very much everyone. Hi, I have met Coral and Martin before. Hello to everybody,

I am Naamin. I am a clerk to governing board for Richmond and Wandsworth and I clerk seven

schools and my background in pension or interest more like, I have been part of different committees

before and I have a keen interest in pension and I in my personal life I do

kind of pay attention to my pension as well and how the investments are going

and so I thought this would be a great opportunity for me to be part of

something great as the LGBT LGPS and I started my trainings and I'm enjoying it

so far but thank you. Wonderful, good to hear and I'm glad you mentioned the word training.

It's always something on the agenda and Coral was nodding her head very wisely there to

say yes it's an important factor and I know a number of us need to get going again in

terms of the new suite of documents for us to get through in terms of training. What

What you'll find is that there are training sessions that we have as part of our meetings,

which are always greatly received and are added to the record that is in place for verifying

the training that we undertake.

But behind that, there is the whole suite documents that you've just referred to, which

are both there for training purposes, but also for dipping in and out of on occasion

as and when there's a certain area that we're not too certain on.

They're there for reference purposes too.

Beyond what the colleagues from Wandsworth are able to contribute as well.

So there's a wealth of information out there, but it's a very complex area.

So the training particularly helps in that.

Anyway, welcome again and we'll continue through the agenda as it's been circulated.

First things first is for us to declare any declarations of interest that we might have

or matters coming up or we foresee coming up on the agenda today that we may have other

interest in beyond being members of the local Pensions Board committee. Does anybody have

any declarations that they feel they need to share? No, that's good. We'll move on to minutes

of last time round. These were for the meeting on the 9th of February and are circulated within the

For those present at the meeting, is everybody happy that they're an accurate record or is

there any comments anybody wishes to raise, either in terms of accuracy or matters arising?

Only from me, just one on matters arising number four about the contribution letters,

that's all been sorted out now.

I mean, Richard, you can probably answer that.

At the end of number four on the agenda on page four, it talks about contribution levy,

said the letters on contribution levy levels have not been sent out to every employer,

I think should be employer.

Yeah, we've certainly had hours.

So Martin, is that the case that they've all been issued?

Yes, that's right.

Yes, all the employers will have their valuation results and contribution levels.

Lovely.

Thank you for that.

So other than that, we're happy that the minutes reflect accurately

what we discussed last time.

Good.

Moving on then, item three, update from the Joint Pensions Committee.

Again, the paperwork was circulated, effectively setting out the minutes of the last meeting

that were held on Tuesday the 10th of March.

Hopefully colleagues have read through that.

I just wanted to comment on the aspect relating to investments and obviously the poor performance

and some aspects of that. I know that's received some comment both obviously within the Joint

Pensions Committee but probably more widely as well. Anything Corral, anything on that at all

that you might want to add where the Joint Pensions Committee are with it, I mean I know

it's a bit difficult now because this is all part of the LCIV and it's really a focus that they

will undertake in respects of our needs going forward but one thing it's spurred in my mind is

what say in the processes going forward the JPC now has in terms of its relationship with

the London CIF in terms of poor performing investment organisations and whether the collective

London boroughs are able to have a say in it and to what degree they do or whether that

is now completely removed from one of their responsibilities.

Is that something you're able to give a bit of a say on?

Yes, yes, I can update you on that.

Although I'm not quite sure how much detail I'm currently allowed to

divulge because things are progressing within the SIV.

So the SIV are now attending every Joint Pensions Committee.

So they are hearing firsthand from the committee.

They're disquiet, shall we say, with the performance of the investments and they're getting very

clear requests to do something about it to improve the performance.

They have taken action.

Like I say, I'm not sure if I'm allowed to divulge the details, but they've come to us

with some proposed actions, well proposed very soon to be implemented actions that should

alleviate some of the issues with our current investments in equities.

So just for Narmin's benefit, the main focus of the poor for performance is around the equity investments managed by the London SIV.

I'll go over this a bit more later on, but because we now have a fit for the future agenda,

which means that we are now required to only invest via a pool, which the London

Civ is our local London pool, although we've let Buckinghamshire in. So we have,

when the consultation for the pooling agenda was live, the vast majority of

funds, per the government's own summary of responses, raised the

issue about holding their pool to account and the lack of

control we have when it's our money that's being invested. But

it's the pool that's making the decisions and we lack, we've

lost a lot of the levers that we used to have. So we can't sack

managers, we can't pull our money out of the pool. What we

can do is tell the pool that we are unhappy about it. And all 33

shareholders in London's SIV have got a vote on the shareholder committee and that is our

power to make the SIV take action.

We do also have now in the investment management agreement, we have a dispute resolution process,

which well, I will name cheque in Paul Gillian Hottie, our senior responsible officer for

our pension fund pushed the CIV to include that for these sort of situations because the government

is saying you've got to vote as one of however many shareholders and we're like we need a bit

more clarity than that you know we can't legally walk away but we can't keep asking employers to

increase their contribution rates because of poor performance. So we do have a dispute resolution

in there. It is very much designed to be a last resort process. But we do have that last

resort process in place now as part of the investment management agreement. So we can

go for, I don't recall the details of it, but I think there's independent arbitration

type dispute resolution, which gives us another way to try and hold the SIV to account. But

they are taking action. We have seen the detail of it as officers and it does

look plausible. It will improve the equity returns in this case.

You're on mute chair. I clicked it but it didn't unmute me. There we are.

Yeah thank you for that Coral. It clearly is something that we need to get

used to in terms of a different approach and a different style in terms of the level of

control that we have as a singular authority in terms of the investments where they are

and the returns that they achieve.

So I get it's a bit like finding our feet with it really, but it clearly shows where

local control having been lost to a degree can come a cropper.

So it's almost like a testbed, this one,

to see how those systems that allow us, say,

can operate and how effective they can be.

Anybody else want to comment on the JPC

and what it's been involved in?

I've got a query on the meeting on the 8th of June,

because it says on the agenda there'd be a verbal update

in terms of what happened at that meeting. So we've got say the responsible

investment paper went there and that's obviously going to inform our

discussions later on the agenda at 8. There was also the excluded item, expand

the pension shared service, are you able to share anything on that or is that

still excluded or it's just really anything that came out of that meeting

because we don't have any minutes from that meeting yet. There aren't any

minutes, I can give you a brief update. We had an item on the audit plan for the current

year which was agreed no problems. A lot of time at the meeting was spent hearing and

discussing another deputation from the unions with, I think, aligned with the Friends of

Palestine as well, which were again raising concerns around the progress that I'm going

discuss under the Responsible Investment Paper later on the agenda. So if

you're okay I will park the detail of that for that item. And that was, to be

honest, as you're probably aware, there's quite a lot of strong opinions on what

should be done in terms of divestment from certain areas. So that took up a lot

of the discussion on the night. There was also updates on Fit for the Future,

which again I'm going to pick up on later on,

and investment performance, which continues to be poor.

But again, I've already updated on the actions

that the SIV is taking regarding that.

Martin, I don't know,

I'm not aware if there's any change

in the exempt nature of the update.

No, it's still exempt, that part,

I know if you were in a public forum here.

Chair, I also was going to ask a question

around stakeholders' views

and the meetings that have happened

that they've been included in.

So I'm pleased that you're going to give us

a bit more understanding

and the processes that the organisation is

or isn't adhering to or agreeing to,

agreeing with the unions or on various matters.

So it'd be useful to hear that.

And I also wanted to know on that particular item,

what is our role as members of the pension board

in relation to, because this has been going on for a while

and they've also asked for our views at some point and we had said no it needs to go back to committee.

So I just wanted to know when you're doing your presentation if you can just include something around that as well please.

Certainly will do.

Yeah thanks Hilary, I mean obviously the key thing from our perspective on investments is obviously the returns clearly but also the ethical side of it

And these are these relative hot potatoes at the moment.

So yeah, we are grateful for what Coral's already said

and what Coral will mention later on

in terms of bringing us up to date with it.

And I think the added complication with this

is the fact that all these investments

are no longer directly under our control either.

So there's a number of layers there

that get in the way of things.

But it's our job to know what's being done

what can be achieved in all of these to appease everybody.

And yeah, we'll look forward to discussing that a little bit more further on. So if we are okay

to move on to item four, which is training, who do I turn to next on that one? Is this

Coral is this you or is this Martin? This will be me Chair, I just need to load my

PowerPoint bear with me for one moment and so we thought it's good time to have

a refresher for for someone else who got our new member today

Welcome to the board. So really a chance to look at the purpose of the

of the board, roles and responsibilities of the board. And local pension

boards were set up over ten years ago and not only for the LGPS but for other

major public sector pension schemes.

And the legislation for the LGPS are in the Low Government Pension Scheme Regulations 2013.

So that covered the implementation and some of the roles of the board.

And primarily it specifies three things that the board should be looking at.

and the board's role is to assist the administering authority, that's the

council, that's the scheme manager for the ones with pension fund, to secure

compliance with the regulations, those like a government pension scheme

regulations and any other legislation relating to the governance and

administration of the scheme and any requirements imposed by the pensions

regulator. So those three things are specified in the Low Government Page

Scheme regulations as what the board's role is to help the admin authority to

secure compliance with and in general to ensure the effective and efficient

governance and administration of the scheme. So you can see right away that

it's not to do with the making decisions on the investment side, it is looking at the overall

structure of the fund, how it's working, the governance. Of course that does include some

decision -making, we've looked at what advice, what actions are being taken on the investment side,

but it's about process rather than decision -making and the general administration of the scheme,

that's why we...

Sorry I think you've lost your microphone. Code of practise that launched in

2024 and we will see that that is being followed. So it does require a

sufficient degree of knowledge and understanding. That is part of the

legislation so the board members do have a regulatory requirement to have a

sufficient level of knowledge and understanding and that is and what

Coral will talk about later is being widened to include committee members as

well so everyone now in terms of the governance of the scheme will have these

requirements on knowledge and understanding. And the board's role is to

make recommendations to the fund in order to improve the administration and

all the governance of the of the fund. So it's not a decision -making body as such

it makes recommendations to improve the governance and administration of the

pension fund. So talk about that legislation, there are various

principle regulations around low government pensions. That's, we're starting

with the Low Government Act 1972 which allows the council as the scheme manager

to delegate decisions to a pensions committee so that pensions what are what

is our joint pensions committee makes those decisions on behalf of the pension

fund on behalf of the council it'd be too unwieldy to to have a full council

decision -making so we delegate it to the pensions committee so the pensions

Committee will make decisions on behalf of the Council and we mentioned the

Pensions Act 2004 which applies across the industry and that created the

Pensions Regulator and set those early knowledge requirements. The Public

Services Pensions Act that was the enabling for the LGPS new regulations

to be made with effect from 2014 and created a scheme advisory board, local pension boards,

the career average revalued earnings, our current way of building up pensions in a yearly

basis and also a cost cap which is the government has set a limit on how much the scheme can

cost and if it exceeds a cost cap then the scheme has to become cheaper in effect.

It's supposed to take the pressure off employers to have an unlimited,

unsustained liability going forward. We talked about the LGPS regulations

2013 so that's the latest iteration of our scheme. All our members now are

benefits that are calculated in the

corners of those regulations since 2014.

In terms of the overall investment

rules, the 2016 investment regs are

really important relating to investment

strategy statements. It brought in

the separation of banking and cash

management away from the council to prevent any possible cross subsidisation.

Coral is the expert on the 2016 regulations so I won't begin to encroach on her knowledge

of that.

So how do we fit in the overall ecosystem of the governance of our low government pension scheme?

Overall the big boss is HM Treasury so they have to okay any changes in regulations because they

the purse strings so they're the overall driver behind change or they have the

the veto on on change. And then the fat what we call the responsible authority

is the MHCLG the Ministry for Housing Communities and local government. They're

the central government department that are responsible for the strategic

management and policymaking for the LGPS. And MHCLG make the regulations that

govern the scheme. Those LGPS regulations come out of MHCLG and changes to the

scheme. And we heard about the pensions regulator. They have that guidance role.

They'll set out administration standards and they will intervene if they think a

scheme or a fund is not performing its duties properly in terms of admin and governance.

We've got the Scheme Advisory Board. They advise both the MHCLG and funds and make recommendations

for scheme changes. So often Scheme Advisory Board is either proposing changes or advising

MHCLG on changes and interpreting those changes for us as funds. So we get a lot

of guidance from the Scheme Advisory Board and we ask some questions all

across the governance and administration and investments areas and they'll give

advice. And so then we come to the administering authority, the council who

has this role of overseeing the pension fund. There's about 86 pension funds in

the country tied to counter councils usually or London boroughs in a big if

you added them all together about 400 billion pounds worth of monies but

separated out into those standalone pension funds and from those standalone

pension funds in those areas the all the emerging benefits get paid out from

those funds. So we are different to a lot of public sector schemes for example

NHS or teachers which are pay -as -you -go pension schemes where the government

just pays out money out of the general exchequer as they go along. We have

dedicated a dedicated pension fund whereby money comes out of and as we've

mentioned earlier and now we've got this from April we've got this compulsory

investment pooling where we have to join and get managed in regions. Again

that's Corals area to expand upon. We have your role as the local

pension board and we talked about the pensions committee having that authority

to make decisions and you're recommending to the pension committee

and to officers where you see fit. So officers have a role in the day -to -day

running of the of the pension fund. And lastly we have the London SIV who have

those responsibility to manage monies and give advice to the council and the

council sets its high level targets in terms of investment but a lot of the

running is done by the London SIF. So part of our part of the oversight is now

over the SIF and again this is straight into Coral's area talking about how we

achieve oversight as a shareholder in the London SIF in the new landscape. So

just looking at some of the administration and communication challenges that all

LGPS providers have, so it's not unique to us, it's industry -wide and

there's complexity around legislation changes. The government regularly changes

the fund, as we talked about the big change in 2014, there was a big change in

2008 and so in general we have three different tranches of benefits that

people have historic entitlements to as well as the current structure of this

scheme and so it makes for complexities around discussing with members how the

scheme works and also keeping our software up to date so when we're paying

benefits we can incorporate all the changes in one payment. There's more and

more members and employers joining.

UK wide, we have about seven million members of the LGPS

and tens of thousands of employers in the LGPS.

We've got more oversight, we've got more bodies

looking at what we do and probably an increased role

for the regulator going forward.

and with all those complexities and need to have accomplished skilled staff and

to recruit and retain them is which is an issue across the industry and one of

the risks if we don't get it right if we're missing data or poor quality data

that will feed into poorer information longer time to take to calculate

benefits, backlogs, delayed payments for waiting for information if the data is

not there we have to wait and ask for it. And the danger of not meeting legal

timescales for benefits so it enshrined in law is the set timescales for paying

benefits giving information to members so it's really important we adhere to

those. So CITFA has produced guidance on what the board member should do,

the board member role, and saying that you should look at the

administration strategy, the communications strategy, engage with the

team, encourage transparency and be supportive. So you know across the

industry, admin admin team shouldn't be defensive, they should be very open and

share any issues that any challenges that they're faced with. For example,

backlogs, data gaps, poor satisfaction scores or lack of time resources to

develop efficiencies improvement. The key thing is admin teams if there are issues

that develop a clear plan of action and time scales to resolve. So there's no

silver bullet in our impenetrable admin in the industry. It's all about direction of

travel, are there milestones, is the direction of travel in there in the

right place and don't judge on a particular set of results. We're looking

at over time what is happening, look at the metrics of and then suggesting you

know looking for a reviewing priorities whether it's mean increasing resources,

new systems, outsourcing, there's various levers that can be taken if

performances are in a sustained period not sufficient. Again from SIP for

guidance what are you looking for as a board are KPIs being met, you can for any

breaches or errors, breaches of the law around pensions, data error errors for

example is if there's been a data breach and information has gone to the

wrong person as we were saying trends over time, custom feedback is important

whether there's any data issues we have data scores and we share those with the

board, looking at employers, what are employers doing, are they meeting their

requirements and is the administration team delivering on priorities on the in

the business plan. So that is a overview of roles and responsibilities were there

any questions on on any of that. Thank you Martin that's all good reinforcement

I hope you found that useful as the first time you've probably seen that.

Thank you, yes.

No, I have been reading on it, so yes, it's a really good reinforcement, thank you.

Thank you.

The chair, I've got just one sort of ancillary question.

With regard to the pension committee, if its role is changing with the SIV,

would there be a requirement to look at the terms of reference for the committee or that sort of

thing? I think Cora did you want to answer it? Are there any plans to change the terms of reference

for the committee? I, well one of the things that I think we will have to do now we've got all the

guidance which I think I put in my report on the governance update that we were expecting guidance

by the end of June, we received it on the 29th of June. So one of the things that is on my list to do

is we cheque that the terms of reference are still fit for purpose for the committee and the board as

well. So I think it is terms of reference should be reviewed fairly regularly anyway to cheque

they're fit for purpose and yeah it is something that's on the to -do list to cheque that.

Thanks, Carl. We're conscious that our next scheduled meeting is going to be November.

So is that something we would be updated on by that stage or is that going to take a little

longer than that? Am I a bit too optimistic?

November feels like a long way away at the moment, but there's quite a few strategies

that need to be updated and reviewed. So it might be that we can do the terms

of reference. I think we need to know the details of the strategies which might

inform what roles are going forwards and we would hope to get as much as possible

to that committee when I speak later on about how far we what our to -do list is

in effect to comply with all the new regulations and guidance.

There's quite a lot to be done and we need to prioritise it in line with the

deadlines for producing some of these things.

So it's going to depend on also how long a meeting you would like in November,

because if we get all of these strategies updated quite quickly,

that's quite a lot of items for the board to consider in one meeting.

Unless you wanted to have a second meeting, add an extra meeting for this.

But there is, as I'll say later on as well, there is under the new regulations, there

is more scrutiny required and a lot of that and consultation and that is part of the role

that the local pensions board is because as well as assisting with the governance, you

are also acting as representatives of the employers or the fund members.

So a lot of these strategy updates are going to need consultation.

So you will be seeing a lot more documentation every time we review a strategy, it will come

through yourselves.

And there's a lot of strategies and policies to review over the next few months.

We can aim for November, but...

Thanks, Cora.

I know there's some timescales out there by which time certain things need to be reviewed

and changed so we have a bit of time so maybe my suggestion to members is a bit too optimistic

on that.

If things are scheduled in such a piecemeal way that it can fit our normal structure then

that's perfectly fine because I know a lot of this will cut through a lot of what we

do, both in terms of policies, in terms of strategies, the risk register, everything

on that side, it's going to have impact in all areas.

So I'm fully aware it's a big upheaval.

So yeah, if it can be done in bite -sized chunks, that's great, but we'll see how it goes.

Thank you for that.

Thank you, Martin.

if everybody's happy with moving on it's Martin again on Pensions Admin Update

yes I was just going to start off with some slides so I was just going to

obviously there's been a big big change this year we have a counsellor access to

the LGPS and so with effect from the 11th of May to 2026 counsellors have

been able to join the opt -in to the pension LGPS pension scheme so they they

were the options were removed in I think 2014 and now the government has

reintroduced it and counsellors are not automatically in all contractually

enrolled like ordinary employees are enrolled in the pension scheme they must

opt in so all counsellors now have the information are aware of the ability to

opt in to the LGPS they've been sent a link to the opt -in form and a guide to

the Councillor LGPS pensions and we've also had a webinar with Wandsworth and

Richmond Councillors recently to give an overview of the LGPS. They do have access

to the member portal, Member Self Service and they can go on there and we are

still waiting for our software supplier to update with retirement

estimate tools for them but I presume there'll be a little while before they

use that but that will be there later in in the year. And just an overview

counsellors broadly get the same benefits as other LGPS members so they're in the

career average revalued earnings scheme like ordinary members. They pay monthly

contributions according to the banding table that other employees use they've

got access to 50 -50 the option where you pay half and you accrue half of your

benefits and the council pays its normal employer contribution to fund their

benefits so got the option of paying extra contributions APCs and ABCs and

their website and our website which we sign post to members gives information

on increasing benefits. They can be entitled to an ill health pension if

they have to leave their post because of permanent ill health and signed off by a

independent registered medical practitioner. There's also survivor

benefits, children benefits payable just like the ordinary members and they can

Transfer in other occupational private pension plans and if they've been in the

LGPS as a councillor elsewhere they can bring that into their councillor

membership. They can't bring in non -councillor LGPS membership so if they

had fund officer role and of council officer role membership they can't bring

that into councillor membership has to be like for like for like but broadly

the same benefits. There are some differences we talked about they have to

opt in whereas normal members are brought in automatically. There's no

redundancy or business efficiency pensioners like there would be for a

for an ordinary non -council member. There's no flexible

retirement and the council can't waive early retirement reductions or award

extra pension on on leaving is that does that make clear what's happening on

councillor pensions yeah thank you okay and pensioner payroll migration is

proceeding we're in a process that we've been in the process because we're doing

across from four of our partner councils we're bringing pensioner payroll in -house

and to our local pension administration system called Altair so we're migrating

from four external payrolls onto one payment system and that will be a it

avoid kind of the previous way of doing it where we inputted data on our

local pension system and then put data onto four external systems so that the

as well as that being double handling of data extra work it also increases the

capacity for transposition errors errors data errors and so it's cleaner to have

it in one single source source of truth and make payments out of one system and

so we just have to replicate the current system in terms of outputs so we're

reporting in a way that our pension funds have all the right data so we've

been going through that process of data mapping across and we're going

through the data cleansing and we'll be going through a reconciliation of making

sure outputs match on the new system and the old system. So we're going through a

period of parallel runs on both and those have to be signed off as being

clean, clear and reconciled before we move to the live. So the plan is that the

first co -life will be on Merton pensioner payroll starting from September

and ones with along with the others will follow in November provided there's

satisfactory parallel running and we're happy with the results and they are

clean we'll go ahead with those go live dates and then after migration there'll

be a stabilisation period and just checking everything is running smoothly.

So it does rely on getting accurate payroll data extracts from the what are

now the external payroll providers. We have a we need those to be aligned with

the general ledger so we're reporting correctly on the right codes what is

being paid out so all funds know what's being paid out and reconciling with

the bank statements what is happening so we're going through in that period and

then we have to go through two successful parallel runs prior to going

live and anything that comes out of that will will cleanse the data and we've got

a live risk register we're monitoring and monitoring and mitigating any any

risk that comes out of that. So that was a migration of payroll as you'll have

read in the reports we are changing the way that we deal with pensioner

existence checking for those living overseas. It is a simple process if

you're living in the UK as a pensioner because as an administrator

point of view because if there's any deaths we get to hear about it from the

general registry office. We have to tell us once notifications you know somebody

registered to death that kind of feeds through to public sector, government

bodies and pension providers. So we have that system for UK base but we at the

moment pay about 1 .8 million pounds pensions every year overseas to about

300 overseas pensioners and overseas there aren't the same safeguards in

in terms of reporting back to us if a pensioner passes away.

We are reliant on next kin to inform us to stop pensions.

And so we're moving to a more robust system

than the previous system of just sending out a piece of paper.

Someone would sign and then send back.

And obviously, signatures deteriorate over time,

with age, usually.

and the system gets less robust as long as it goes on. So we're bringing in more

validations, more electronic identity checking into the process. So we'll team

you up with an external provider, Mortality Manifest, to help us do that.

We still own the process, we still get the final decision in terms of stopping

anybody's pensions as a fund but mortality manifest will help us because

they've got a platform a digital platform where you can I prove your

identity and if you're familiar with banking or mortgage or insurance

companies you'll know the system of identity checking on online and so

This will go out to all our overseas pensioners shortly. They'll be given the

option to go on to a digital platform and confirm their identity and that will

avoid the problems we've been having with post. Many countries don't have a

great postal service and it has meant that people have to wait weeks and weeks

to get a paper form and then we have to wait wait weeks and weeks to receive

that paper form so it will save all that and still have a paper -based method for

those who are digitally excluded so we'll write them in paper and they can

send back on on paper but I think most of our overseas pensioners are used to

digital and would prefer a more secure way of getting that feeling the

reassurance that it will be done and dusted very quickly and they'll have the

verification and that will be their pension notified and in place for

another for another year. So the validation process as I said is

something you'll probably be familiar if you've used used one before for other

activities it can be completed on a computer smartphone or tablet a device

There is a QR code that they are sent by email if we have an email address or post if we have a postal address.

Each link is unique to the member and can be accessed multiple times until the process is completed.

So they can go away, find their documents, come back, restart and do that until they've completed.

And that gets reported on how far people are along the journey.

if we can see any bottlenecks will get reported on that'll be reported and any

amount of abandonment to the process we can see any any activity that any

concerns from the from the process but it allow us to manage the process better

see what people are doing what stage they are at in the process and yes is

that you take a photograph yourself you take a photograph of your electronic

either driving licence or passport. So that was overseas pensioners and I just

wanted to highlight the access and fairness changes which come in this

financial year. The government has, I think we've spoken about this before, the

government's remedy to historic inequalities around sex discrimination

gender discrimination. So they've looked at all the survivor benefits and

equalised them that no one is getting less in terms of survivor benefits just

because of their gender or sexuality. And the key group is male survivors of

female members who had those female members had pre -April 1988 service and

before that all that service before 1988 was excluded since these changes is now

included so

widowers who didn't have

Including in their in their pension calculations and have now got that included in their calculation

So it means increasing pensions or for some people having a new pension entirely a new entitlement

So we have to backdate quite considerably

And it goes back to December 2005 for opposite sex and civil partners, 2014 for same -sex

marriages, and back to 2019 for opposite sex civil partnerships.

So quite a lot going on in terms of recalculating retrospectively.

And alongside that, the government has removed an upper age limit for death grants.

before that if he died after the age of 75 there was no death grant payable now

that has been changed there's no upper age limit so for members who died after

the age of 75 we have to look back to 2014 and calculate a death grant for

those for those members and going forward there's no upper age limit

either. So quite a lot going on in terms of retrospective calculations. We talk

about that quite significant group of women who have died and they had

pre -1990 sorry 1988 service and their widowers pensions will now need to be

recalculated. So on the initial reports we've had in the system there were 227

Wandsworth members, female members who had died so they're potentially, their

widowers are potentially in scope for an enhancement. And the government has set

out a timescale for us to follow. It covers about 18 months from the

that came in in April. So the first stage is just basically now to

identify those relevant deaths that we were talking about a moment ago and then

identify potential possible survivors. So we've looked at who has died, we looked

in the last slide how many women with pre -88 service have died and now we need

identify their widowers and that's by October and then we have to contact

within 12 months of completing step 2.

These may be some time ago so we may have lost contact with widowers or we

may never have been informed of a widower so we have to make at least three

attempt to contact the widower and then recalculate benefits and either

existing benefits enhanced or make those new benefits so so we have time scales

in Saturday legislation to do that we also in we've talked about the age 75

removing that limit for death grants initial looking at that of people who

died over the age of 75 who now will be entitled to a death grant. We've got

about 30 historic cases of those aged 75 and now it's a question of calculating

the death grant we have until October for that then identifying beneficiaries

from the first of you know late no later than the first of January 2027. So again

we may not have details of a because there wasn't any death grant payable

when the person died back to 2014 we may not have those details and we may not

have a contact to pay a death grant to but we will contact you know try

identify beneficiaries look at the files your information we have and then reach

out and make at least three attempts to get somebody to come forward in those cases.

So that's the kind of background and I'd say you will have the paper in front of you.

Are there any questions on what anything we've discussed in that?

Colleagues, anybody like to?

I just wanted to ask a question.

Suppose the deceased doesn't have a partner but have children.

Does that apply to children receiving the backdated money?

I wasn't quite sure.

No, I mean, we've got two things. We've got survivor benefits, and the reason they're

getting paid is because of the particular calculations of spouses, whether they were

– we're talking about opposite sex and civil partnerships. Obviously, children aren't

in that category, so it's particularly to do with the effect of whether you're in

a civil partnership or a marriage and gender that created historic imbalances.

So that's what's being addressed.

So that's not to do with children.

I think to do with children.

Yes, I understood that.

But I was just wondering, is there any discussions about children?

Because a single person who has a child who is paid out, for instance, for funeral costs

and so forth, they would not be entitled to apply. It's a general question really.

It doesn't come under the spouse's pensions or partners' pensions. That's not what

that legislation is about. It's about, as I say, helping gender discrimination and

sexual orientation and discrimination so that's not what that's...

No, I'm clear about that. I'm clear about that, Martin. I was just wondering if there was anything in the pipeline around children or not.

Well, children do have entitlements under the regulations already so that's not affected by this.

So they do have an entitlement if they're under the age of 18 or through to 23 if they're in full -time educational training.

so they do have entitlements under the legislation. So in terms of the paper we

were talking about employer performance so a comparison of data quality and

timeliness of dates that we're getting from employers. We do, there are, we don't

have the majority in terms of data quality are kind of at the amber, not

quite hitting clean data but we're finding an improvement in data quality

and employer performance now we're in the third year of recharging employers

over three years in total from employers we've recharged about nearly a quarter

of a million pounds to employers because of poor performance and but that is

reducing a lot of issues were around one particular payroll provider Strictly

Education who has now left the market and they had about a hundred

thousand pounds worth of recharges were attributable to to them out of our 250 ,000.

So a large chunk was down to one particular

pay multiple payroll provider. So they've left the market and so that has seen an

improvement on employer performance. We will revisit employer

performance and the admin strategy. Now we've got the new guidance. We will look

at our admin strategy which covers communicating and improving employer

performance. So it is a work in in progress but we have seen improvements

in employer performance and we also include the the recharges that we we

make to employers to we kind of report those to the board survey are on there

as well as well as our admin KPIs we are we are reporting and we discussed in the

last meeting around transfers we had backlogs which we are working through

and the team is getting through the transfer backlogs so we do hope to see

that and an improvement around transfers. But if there were any questions on the

report. I'm happy to to take those. Any colleagues like to chip in? Just a query

from me on the the number of employers. So Merton has a very small number of

employers is that just because they're outsourcing policy at the council

previously or I just wonder why because there's only 15 employers whereas 87 for

ourselves 102 for Waltham Forest? Yes a lot of it will be on well there's a few

factors but yeah Waltham Forest has had a more proactive outsourcing policy and

they've got a lot a relatively high number of external employers outsourced

employers say around schools or other whereas Merton haven't I mean Merton are

smaller fund so they are about three quarters of the size of Wharham

Forest and probably half the size of the ones were but but you're right yes there

is even with bearing that in mind some some funds or some councils are more

aligned to more outsourcing than than others

My other queries on the appendix A on page 26 are the figures just for Wandsworth or are they for the whole of the service?

The administration performance figures for the two final columns. They're Wandsworth only are they?

Martin you're mute.

Apologies, yes, they are Wandsworth.

Yes.

Thank you, Martin. Just a couple of points. One, just to take you back to the payroll

side of things that you are gallantly taking on going forward. What does that do in terms of

staffing? Does that mean you need to increase your staffing or is it people you'll be pinching from

the payroll department where they be moving across and is there a net gain or

loss in terms of that that move? Yes that's right we have had to expand so

we've had a new, well I say new, they started at the beginning of the year

because they had to have a lead in head of payroll and projects and payments and with

colleagues so we have extended the in -house payroll team with a view to

looking at staffing when the efficiencies have come into play when

we've stopped having to do that double inputting of you know their first of all

input on the host system and then input again on the external payroll that does

involve a lot of double entry and so there will be administrative savings

down the line when we're just dealing with one system. So down the line

we'll look at resourcing and now because of all the data cleansing and the change

we're not in position to look at you know savings in terms of staff. It's a

net plus at the moment but that will be reviewed when we when we settle into the

new admin processes. Okay thank you for that. You talked about Waltham Forest

having a lot of non -council employers as part of their set up. I noticed

they've been the ones who've been hit heaviest with invoices for late payments

or errors etc. Is that widespread in terms of say a number of schools that

aren't doing their returns appropriately or is it is that more council based? It is

because of schools and primarily because of strictly education and the fact that

Waltham Forest their schools use different payroll providers so they've

a lot well they they a lot of the schools use strictly education whereas

in some boroughs you can see a lot of schools are on the host payroll council

payroll but they they've gone down the route of choosing external payrolls and

unfortunately a lot of them chose strictly education which has led to a

because of their performance that's a knock -on effect on a lot of schools as

employers in the in the fund and so I understand that Strictly Education has

funded their their errors and perhaps that's one of the reasons they've left

the market they were they did kind of cover costs but it may I think it made

the model not as attractive for them so yes they've it is down to schools using

external payroll providers and that's one of the reasons that we we show a

a league table of multiple payroll providers at our employer forums so they can see who's

doing well and who's not performing.

Hopefully we're not going to get employers concentrating in badly before me multiple

payroll providers.

Thank you, Martin.

My last comment really is just on the work plan.

I think just picking out three activities within that where the to -do was pretty much

within the first quarter and they possibly are still outstanding.

Just the three that I picked out were pensions increased lump sums to payroll, annual certificate

for overseas pensioners and the pensions admin strategy.

those were all sort of down for being done by the first quarter of the year.

Are those still outstanding and is that, are we struggling to keep up or is

that just too many things appearing in first quarter that we're not able to do them all?

That is, we spoke about the annual certificates and the new method and with our new partner,

so that is we are we are close to the new partner because of the changes

system is a little bit later we thought it'd be before the end of June it's

going to be probably in the next two weeks so we're into July so that has

crept into the second quarter because it's a new system and we'll look at that

for next year whether we can get it a little bit earlier but I think because

is the launch it has been delayed yes the the pension increase on lump sum

again is crept into July so it's over the quarter there's just there's not a

major reason for that it had that has slipped into the next quarter because of

other priorities. Sorry the third point is the pensions administration strategy

that presumably is all linked to what we've discussed earlier. Yes we only

just got the guidance on the 30th of June for that so I think initially we

were thinking the guidance might be a close to April and we might be further

down the track on that but yeah that's I think yeah we had to wait until the

guidance, see whether the guidance says anything new in that before the

before launching the administration strategy so yeah that will be and now

pushed pushed into Q2. I know Coral we're going to be meeting aren't we about

strategies shortly, the other strategies that are coming out of the guidance but

though it's fair fair comment on all three of those they have been pushed

to push back. Well it's okay, this is understandable these things happen, it's just really making

sure there's no underlying issue that we need worry about. I think other than that, again

your KPI's are excellent again and it's there always a pleasure to read so makes our job

a lot easier in terms of just saying congratulations for keeping up the good work and I know there's

been a fair bit going on and there's still a fair bit coming down the

line but it's good to see innovations and making improvements so

that the members themselves get a better experience at the end of the day so well

done on all that and keep it going. Thank you chair I will pass it on to the team

we had an equivalent message from the board I went to earlier in the week from

the Waltham Forest Chair, so we'll pass that both onto the team. Thank you.

Excellent. Item six is the Chair's report for activity undertaken by us through

the 25 -26 financial year. I've circulated this and I have to say heavily

indebted to Cole for her assistance in us putting this together. So hopefully

colleagues have had a chance to read through. Happy for any comments or

anything that that's not correct or anything that's been omitted or any

other general comments people might wish to make on it?

I think it's very good report share.

My only query is on page 36, one, two, three, the second bullet point, it talks about various

pressure groups, which is, I think we're referring to trade unions, would they consider that

inflammatory do we think or not?

This is the issues raised about divestment, whether we use the word pressure groups.

Maybe various external bodies. Yeah, something a bit softer.

Yeah, possibly. I think very good reports and yeah.

Yeah, definitely. Support that. Lovely. Thank you, colleagues.

So yeah, we'll make that change. Good comment. We don't want to encourage

further pressure by putting in pressure groups as a wording so that's a good point. Right item

seven, pension fund annual report, the biggie for this particular meeting, one of the biggies,

a lot of it's sitting on Coral's lap so Coral would you like to introduce it? Certainly, so

just briefly for the the new board member, every year the pension fund is required to produce an

report. The contents of that report is set out in statutory guidance and the

ability to just put in links to some of the documents. It used to be a lot longer

because we had to copy and paste in all the documents like the investment

strategy statement and now we can just say it's available here on the website

with the link which has cut down the volume of it although it is still quite

long. It's the backward -looking document. It is in a way a review of the past year

for the whole pension fund, so it includes the administration side, the

investment side, the financial position, value for money, stats on the cost per

unit. It's in theory pretty much everything you'd want to know about the

pension fund in that one document. This is the first time that we've got it to a

this early in the year I think. What we've done in the past which wasn't ideal

was the document would be approved by the Joint Pensions Committee at their

September meeting and then reviewed by the local Pensions Board in the November

meeting prior to publication by the statutory deadline or the 1st of

December. It is of course best practise to consult with the local Pensions Board

before it's approved for publication. So we're now doing it the correct way round. Unfortunately,

because this is the first year of doing it, there's a couple of external bodies who haven't

been able to get their information to us quite in time for it. So I've referenced this in the

cover report. The PERC information on performance stats we have now received. So it was a matter

of days too late for inclusion. I can circulate that missing data if a board

would like. We've had something as well from the London Sieve, as I'm sure you've

been made aware by now, there's a lot of additional work going on in the London

Sieve at the moment, so the fact that they couldn't quite get this data

together in time in the same format as last year is probably

understandable at the moment and I don't know if if our authorities have got a

local pensions board as early as ours but we we have got something from them

for the current year's savings but I need to confirm with them I can just

slot it into the table. So it has been a fair amount of work getting this

together. I would remind the board that the annual report includes the board's

performance on training and completion of training as well as the committees

and the offices. The board are all due for their training refresher and of

course our new member needs to complete her training for the first time. The

totally refresh the system in May in line with the change of in line with the

local government elections so there's a new version which should be more user

friendly I've done the first one or two modules of it and it's not they have

changed the format it used to be just sitting and watching videos of people

reading from a script. It's shorter videos now, it's more, and then there's

sort of like as you go sort of quizzes. It is more interactive and I know our

new board member has said she's found it quite interesting, but it is very

different from what you looked at last time you did it. So and hopefully it's

easier and more engaging for the user because it was, to be honest, I felt it

quite dry myself of a prior version and so yeah you are you are required to redo the whole of that

now but it is a completely revamped version now so it will be maybe the content won't all be new

and exciting but the format certainly will be more engaging than last time so I would remind

board to please start their annual refresher of that. Could I just say, sorry, when I received

the link for the emails, obviously we do our due diligence and I didn't really know this was the,

this would be the training link, so I had to do my Google research and that's when I realised what

was. But I think it's quite easy to miss that it is the training set. Thank you, Coral. It is quite

helpful because it comes with the last, you have to get some marks to pass the test, which is very

helpful because that's when you know how much you have learned. Thank you. I had one question about

other documents that were sent and in page 55 I can see that we had 20 % more transfer

out this year, comparing to last year, is this something regular? Like this is the 20 % seems a

bit big number but I think it will be, you will be able to like differentiate?

Yeah by all means, no I mean that people can chip in as and when it's a big document. I've got

fair to do. You say page 55 as in the top heading. Yes, yes so page 55 and then

on the the table shows there is an ongoing net withdrawal from dealing with

members from there and if you go to transfer in and then there is transfer

out the number of staff leaving fund employers and transferring their

crude pension to the new employer reduced around 20%.

Yeah. Um, Martin, did any, any,

any knowledge as to why that might be? I know, I know these, these,

the transfers in and then transfers out are always going to be, um,

less reliable if you like in terms of being close to the prior year,

because there could be key drivers behind that. But Martin,

any ideas as to why fewer transfers out?

I don't know exactly but I would say there are always going to be changes you

know we'll have outsourcing of say environmental services one in one year

there might be a particular service that moves to another borough so it's always

very difficult to predict what's whether there's going to be a big change in next

year but so there's no fundamental you know issue of you know people leaving

leaving the scheme or you know it's just peaks and troughs in terms of you know

who's who leaves in any given year so it's very difficult to predict how much

say it will be transferred out to the scheme next next year because you know

as they services can move or you can have high value directors move to a

fund and have a big transfer out of the of the fund or you know a few directors

move so it's very difficult to forecast you know idiot year what's going to

going to happen but I don't know there's anything you know there's no fundamental

issue in terms of whether it goes up or down you'll find that every every year

Laura, I don't know what you want to add to that.

No, just to agree with you, it is very difficult to predict.

So I can look at the overall statistics and see the numbers have changed by this much,

but the average payment per person will change as well because it does depend on the person

who's transferring whether they were, as Martin says, an executive director or just started

as an admin officer, how long they had in the fund because it's the net value of

accrued benefits, isn't it, that we transfer. So the actuary does the maths

on all of this to figure out what the value is that we need to pay to the

pension fund that they're transferring their net accrued asset to and it will

depend on so many factors. You can't really take much from trends in it, it's

just, yeah, we probably could do a lot of work and dig down and

go, we had so many directors with this many years of service,

but I'm not quite sure what it would add to our understanding

of anything or our ability to predict anything. I think the

only thing I would say, though, is that with the transformation

project coming up in the Better Shared Partnership, that may

increase the number of transfers out or other people leaving one of the

employers in the fund in future years but again you can't predict how much

that would be. Yeah that's true and I think we also find the same is

true in terms of looking at the KPIs in terms of how long it takes to complete a

transfer in or transfer out. It's not just down to our authority it's the

recipient or the donator from the other end as well. So these things can take longer than

the one would expect and it's probably the most trickiest area for the KPI to be at 90 -95 %

plus, which is true with all the other performance indicators, but it's not through that the

authorities are going to try to get there.

Thank you, thank you, makes sense.

Coral, would you like to carry on in terms of introduction or are you happy that we can

launch into any comments we might have?

It's a very long document and I think it might be better to move on to comments unless

anyone feels they don't understand, has any questions on the document or process generally.

No?

Okay.

Hillary, would you like, have you got any comments that you've, in reading through it,

anything that you might like to raise with the authority?

No, not at the moment.

I think that I need to read it again.

I need to read the document again

because usually I put my little notes aside

but I haven't done that this time.

So I haven't got anything.

That's fine.

Mel, anything that you want to point out specifically?

Not from me this time.

Peter.

Hi.

On page 52, we've got the local pension board meetings.

It says for Chris Jones, zero out of three, but I thought on the other, on the Chairs report, we talked about Chris attending one meeting.

In the local pension board meetings attended table.

Well in theory I copied that from the chairs report but.

Yeah so it should be one I think.

And then by the query on this page is on the commentary on the work of the pensions committee.

We list the meetings that were held and then there's a link to the reports,

whereas we don't do that for the Pensions Board, should we do that?

Apologies, I will be adding that now. Obviously these were both going on the

same agenda so I couldn't put in the link to the live agenda document until

it was published which was at the same time this year. I should have said that I

will be adding that before it goes to Joint Pensions Committee, absolutely

right but he didn't exist on the internet to link to when I was producing the document.

I'm sorry I've just gone back to the chair's report and for Chris we had he didn't attend one

and then he resigned so he had nil attendance in the chair's report as well.

Was it?

Anyway, that's fine.

But I suppose what I'm saying on the commentary section on page 52, should we be listing the dates of the committees, of the board meetings, in the same way we've listed it for the committee?

Makes sense to me, there's a consistency there, if that's doable.

Yeah sure, I didn't do it because it is in the other document, but if you feel it'd be more

helpful to have the list, happy to add it. Yeah because it's separate to the annual report, so I

think yeah if we can add that in that would be good. The only thing on that one at the bottom

there it should be 2026 rather than 2025 just as today's I presume that's

referring to today's meeting so if we could just change that yes that will be

on the page 52. The other one I've got a query on is the Virgin Media ruling

and whether we need to be aware of that because I think it did in this report

just says we don't think it's going to be necessary to make any allowance for it.

Is that something we've considered?

So the statement in there is what I've taken from the actuary's briefing notes

on the IS -19 on the end of year reporting from the actuary. So this is

not my words, it's my paraphrasing of the information that I've been given by the actuary.

So it's my words based on expert advice.

Martin, is there anything else you wanted to add in on the Virgin Media side of it?

Well Virgin Media was there was a site issue around equalisation of GM GMP where

external funds were saying that the LGPS would have to go through an equalisation

of GMP process and LGPS hasn't and there were some discussions around whether the

that would stop transfers in and out of the scheme but as far as I know that's

resolved we're not seeing any any issues long -term plan would be for that it all

schemes to look at you know GMP's in the and say there's no gender discrimination

in terms of what's being accrued by by by people but in the short answer is

that there's there's not been any issue identified for the LGPS and the actually

obviously feeling that although it's quite a published case it's not really

really gonna have a knock -on effect for the LGPS, so not creating liabilities for

the LGPS. Thank you. I just got a couple of extra points really just looking

through it. On page 55 the third bullet point there which refers to lump sum

retirement benefits states there was an increase in the number of payments made in the year.

Now that wouldn't necessarily be inferred when you look across back to page 54 when

the actual sums paid out are quite a bit less than last year.

But just checking that that is correctly worded that there actually were more payments made

in the year even though the amounts involved are quite a bit less.

I would need to go back to the working papers on that one I'm afraid. I will double cheque it.

Lovely thanks Coral, I mean obviously can be that there were lots more smaller payments made in the

year but you'd look across at the numbers on the previous page and you'd think is that a mistake so

just probably worth double checking. Absolutely will do. And then page 59,

these are just these just prompt queries rather than big errors, page 59

when we talk about unrecovered payments, quite an increase in the figures for 25,

26 compared to 24, 25. I just wonder whether there was any any rationale

behind that? I mean the closing balance of overpayments at the year end is

32 % increase on the previous year.

Is that just something that can vary year on year

or is there any other underlying rationale behind it?

So I can update you on that.

So there has been some debate over the responsibility

for debt recovery in this issue.

That has now been resolved as of 1st July. Capita have taken on debt recovery for overpayments,

but only for new cases input to the system prior, sorry, subsequent to the 1st July onwards.

So we have involved Capita's team which should lead to a reduction in the rate of increase.

We now need to go back and revisit the outstanding overpayments and look at the potential to write

some of them off and pursue debt recovery on those. Capita are not overly

interested in taking on debt recovery for the older debts as I can kind of

see where they're coming from on that because the older the debt the harder it

is to recover but I think we are going to go back to them and ask what

what they would be willing to do in terms of that because I believe

Martin will know more about it because it involves the capacity of his team in

looking at these debts and recovering them. So Martin would you like to comment

from the point of view of your team? I don't really have any news on that.

we we do have a process for all our funds where we send out the initial

letters saying how much has been overpaid and in terms of recovery you

know we don't we don't we're not we're not recovery agents we don't you know

you know follow through into a court action that would be another you know

each fund has to recover its own debt we're all rolling the process really

to make sure that people know they've been overpaid.

And then it's up to the councils to recover the debt.

Okay, thanks, Martin.

Page, so on the one's a fund account,

which is set out on page 62,

there's, towards the bottom,

there's a section that refers to profit and loss

on disposal of investments

and changes in the value of investments.

and then it takes you to note 16 and that figure is correct in terms of what's shown in note 16.

But there's also a separate note 25 which is on page, finishes on page 88, which I think should

reflect the same figure but instead of 135954 the one on page 88 has got a figure of 136846

so there might be an error there. Worth looking at maybe.

That gains loss on financial instruments is how it's referred to in MOPE 25. I'm

only picking that up because the corresponding figure for the

previous year of 51093 is consistent in both note 19, sorry note 16 and the figure within

the Wanda fund accounts I would expect it to be the same but maybe just one to look

at, not for now.

I know that was one of the figures that we amend very late on in the process because

we're waiting on some of our investment managers send reports up to, I think the 18th of May was the

most recent one that we received and of course we're working, we'd agreed with the council to

provide the accounts to them by the 31st of May so it might be that one of the the cheques to make

sure that everything was updated for that last report failed. I shall have a look at that, thank

Okay, that's alright. Just two final comments from me really in terms of interest.

Note 31 on page 97 talks about ABCs and there's been a, I mean it's not huge, but there's

been about a 19 % increase in the amount of ABCs being contributed to in the year. Is

that a general trend that is happening, Martin, generally, that more people are paying ABCs

or is it just a peak year? Since the council moved to shared cost ABCs and

has an agreement with a firm called Money Matters there's a lot of

communication now to two members and you know a lot of information and publicity

around ABCs is coming through the council as part of the Money Matters

campaigns so I think that has led to an increase in subscribers to paying ABCs

and that has a knock -on benefit for the council because of savings in

employer national insurance through shared cost ABCs so I think a

lot of councils up and down the country have found that be beneficial so it has

benefits for members as well as employers. So yeah, yeah, there's been more promotion around AVCs.

Lovely. And the final one on page 118, which refers to the value for money statement side

of things, and then you've got a comparison there between 25, 26 and 24, 25 unit cost per member.

That's gone up quite a bit on the previous year now.

Clearly that's based upon the total admin costs for running the service.

And I know our staff numbers have gone up quite rightly to fill vacant posts, etc.

Is that just a straight reflection of that?

that the increased staffing per member has gone up compared to the overall membership

equating to the same sort of level in a way so the average cost per member is increased because

your staffing base is that much bigger now? Yes we've got a bigger staffing base and you'll know

from previous board meetings where we've had a lot of tooth to say two years ago

we had a lot of vacancies we weren't running on full and staff but assist to

August 2024 we've pretty much fully staffed so no vacancies and that has a

knock on and failure we're actually now you know spending the full staffing

budget and as you say we've taken on new staff for the payroll and we've also

started to pay implementation costs you know quite quite far in advance of the

go live launch we've had to implement change our configure our systems gather

information so getting extra charges so I think and this will extend into this

year we're gonna spend more on implementation. We'll also be paying out

the fund for our pensioner payroll as as it stands with the in the council's

payroll system as well as running our own in this kind of transition stage of

parallel running. So there will be costs in the short term but it doesn't lead to

efficiencies. We will be spending less on payroll costs for example once we get

out of this period into future years. So be a lot a lot of saving around the

payroll and then we can look at staffing as well in terms of new processes. So yes

there are more upfront costs at the moment but I can see once we settle

stabilise we will be coming back with you know less costs. Thank you for that

that's me done on pension fund annual report any other comments from

colleagues if not should we move on to the section item number eight which is

on responsible investment so back to you again Coral. Yes indeed and this is

This is the one where I need to pick up Hillary's earlier point on, I think, what the board's role is in this.

So I think I'll give a little bit more history than I normally would for the benefit of your new colleague on the board.

So, there used to be...

The Pensions Committee didn't used to have as much external interest as it does now.

Then starting with things like climate change and people lobbying for action to be taken on climate change.

And now the lobbying has moved to human rights issues in conflict zones.

So it has become over time, the investment decisions taken by the Pensions Committee have become more, shall we say, political with a small p.

So there's a lot more interest in it and there's a lot more concern from external bodies on

the ethical side or the responsible investment side, as the name of the paper suggests, of

how we're investing all of this money.

So going back to, I think it was October 2024, we had the first deputation from, and I think

that time it was the Friends of Palestine as well as union representatives who came in to talk to

the committee and raise their concerns around investments being made that could be linked to

human rights issues in the Gaza area. Since then we've had, I think it's five now deputations

attending Joint Pensions Committee, again, all following on from the initial raising

awareness of concerns around human rights violations. The committee generally

have sympathy with the concerns, but the committee also needs to make investment decisions that

with the regulations. The regulations actually say that the primary duty of the committee in making

investment decision is its fiduciary duty, that is to get the best financial outcome possible for

the pension fund and the members of the pension fund. That obviously would involve us investing

in anything that will make a good return and things like war is profitable, fossil fuels

are profitable.

Alongside that, the fund has the power to make an investment decision, having taken

proper advice from an expert advisor, which up to now has been MRSA as the fund's investment

advisors. If that advice shows that there is not a significant financial loss impairment,

I forget the exact wording of the thing, so if it only has a small adverse impact on the fund's

financial position and also if the fund has reason to believe that the decision would be supported by

the majority of stakeholders. As part of going through this process of looking into the issues

raised by the lobby groups, the external bodies and their concerns, the committee has looked

at, got clarification of what its power is to make these decisions, which involved taking

Kings Council's opinion, which confirmed what officers had been working to all along and

the Kings Council opinion given back to the scheme advisory board previously, which is

the three -stage test, which I've just explained. Alongside this, we have had all the changes

coming from Fit for the Future, which has delayed the process because, as we've spoken

about earlier, the fund now has to invest by its local pool,

which is the London SIV. And the London SIV as part of this

process has also been reviewing its own responsible investment

process. So we didn't know what our options were to choose from

until fairly recently, we now have the options in front of us.

What London SIV are talking about is free pillars. I don't

know why they're calling it pillars. That's their chosen

Turn Free is basically free options going from low level of exclusions,

excluding things that are basically illegal up to a high level of exclusions.

There are lists publicly available, I won't go through it all, but the

deputations that we've heard would be more inclined to the higher level of

exclusions in Pillar 3. So we now know what our options are, what decisions we need to

make, what options we can pick from with our required investment in the pool. We know that

even if we went with the higher exclusion level, it would not have a significant financial

impact, detrimental financial impact on the fund. And I would remind the board, those

members of the board who were there at the time. We didn't

need to go through the consultation process when we

set a net zero target because the financial impact was

beneficial to the pension fund. So it was in line with fiduciary

duty. We didn't need to tick those up for free boxes after

taking the advice that confirmed it was a fiduciary duty decision.

So we're now at the point where if we want to make the level of

exclusions that the committee are considering, we need to take into account the views of

the membership and the stakeholders in the pension fund.

That includes a survey of the members of the fund, that is anyone who is a current deferred

or an active member, so people like myself who are paying into the pension fund as we speak,

not as we speak, people who are currently drawing their pension and people who have a deferred money

in the pot. As at the 31st of March, that was 44 ,000 odd people, which we've commissioned an

external experts on doing these sort of surveys. They've worked

with a couple of other pension funds. So the Pensions

Committee received a draught version of the member survey.

And there was a lot of discussion at the committee

around the content of the survey, the wording of the

survey. In producing this survey, we have consulted with

councillors, we've consulted with the unions as well. They

shared information on what they thought should be in the survey. What we cannot

do is offer options that are illegal. So there is one of the points of

contention in the wording at the moment is around what we can and can't offer. We

have taken legal advice that says we cannot exclude particular regions, I

believe is the legal advice, so we have to be quite careful about what we are

aren't excluding because we have an equality duty. So if we include something based on a region

that's in conflict with the qualities legislation, so we have to be very careful

on what exclusions we can and can't do to comply with the regulations and that is the officer's

role to get advice for the pensions committee so they understand what they can and can't do

in terms of the regulations, legal requirements as they stand.

And it is the role of the local pensions board to assist the administration of administering authority

in complying with regulations, as Martin said earlier in the training.

So you need to look at the process that's going on and be comfortable that we are acting legally,

that we're complying with regulations, we're acting in accordance with best practise as far as possible.

But you also are representatives on the board, you represent employers or members of the pension fund

and as such you have a role in this consultation as well as you will have a role in future

consultations. So this has come to you to update you on what we're doing for you to review it in

terms of compliance with regulations. And also, we would like to take your views on

what, in broad terms, not in exact wording, but what sort of themes we're looking to be

consulting on. Have we missed any areas that you think stakeholders will want to comment

on? I think we've added in the ones we've had lobbying on. We've added in something

around animal rights, I believe, which was in response to consultations with other people.

Is there any things that we're missing that we think people would want to give their views

on? Also, we've spent time looking at surveying members, but we haven't started looking at

the best way to survey employers. As employee representatives on the Fund, we particularly

like views on how we should be consulting with the employer side of the stakeholders within the fund

as well. So we had got a draught consultation, but there was a lot of discussion around the survey

at the committee on the night. There were a lot of differing viewpoints aired and

and officers and committee members have gone away to work on the wording of it.

So we don't particularly want detailed wording issues.

We would like more general themes, what it should cover, principles, that sort of comment

at the moment, because the wording of it, if you go and look at what was published at

pensions committee, that will be changing anyway so please don't start commenting on the detailed

wording. So that's what I wanted to say to introduce this item. So I would welcome feedback

from the board on the content, the broad themes of content within any consultation and also how to

best to consult with employers. Okay thanks Coral, quite a tricky one.

A couple points spring to mind here with me initially.

One is, are we doing this alone?

Presumably other administering authorities must be having to tackle the same scenario

that you've just outlined here.

It seems to me a bit strange that each is going to come up with his own view on this

and to some extent, in my mind, the safety numbers,

if we're all going off in our own 33 separate pension boards

to discuss how best to do this,

it's gonna complicate the picture.

Equally, obviously we've not had anything presented

to us today, so we can't comment upon that

at this particular stage,

but I do worry that it's without guidance and without input from

Bursar or whoever in terms of we believe this is right for Pillar C rather than Pillar B rather

and pillar A, we need some reassurance somewhere in the system that we're going in the right

direction because if it's listing a whole bunch of areas that need to be covered, there

are going to be areas that are missed off.

If it's talking about, I know you said it can't exclude particular regions, that's good

because you'd never reach an endpoint.

There's always every region that's got positives, negatives that anybody could say,

hold on a minute, what about this? Hold on, what about that? So I think from a general perspective,

we could probably say, yeah, that seems fair, well, that seems reasonable, or this doesn't

seem right, this seems to miss out in this area. It's difficult to comment on without having a

in front of you. But what you've said in terms of the board's role is to cover this angle

or to cover that angle, I get that, and that quite right is what we're there for. But at

this particular juncture, without a revised survey to get our teeth into in terms of oversight,

I think we're a bit limited at the minute in terms of where we can give further advice

other than just the generic that I've said it seems a bit of a quandary at the minute

that we're going to have an input to.

Certainly from an employer's perspective, once the members' version is out there, I

think that's something I'd feel more comfortable with at that particular point to give some

views on, but I think we're a little bit powerless at the minute to say anything other than yeah

understand it's all seemingly going in the right direction, but until we've got something in front

of us to say right this is the latest draught of an end product, it will be difficult to make any

further comment. I don't know if colleagues have any other any other bits who can put it more

succinctly that I did there but...

I'm not sure about that, Chair, but for me, when I read the documents and the unions were

saying other local authorities had moved along further than we had, as one's word, I'm not

saying that's right, true or not true or anything, but that's what I read.

Well, I'd want to know, well, what is it they've moved further along than Wandsworth has?

I just keep having sort of questions rather than feeling that we're moving in a different

direction.

I think we're all kind of stuck in trying to work on this one, but I don't know what it is that other local authorities, as the union is saying, have moved further along, further along on what, and what was their processes that got them to be moving further along than we have thus far.

So in terms of what other local authorities have done, obviously we have a lot of contacts in

other local authorities, more in London than elsewhere. Our understanding is that some of

our authorities have given commitments to do things, but that has not necessarily resolved

itself into any actions yet, similar to ourselves in a lot of ways. We are aware of, I believe,

it's two other authorities that are in the process of consulting with Scheme members,

Scheme stakeholders on what exclusions they should be making, similar to what we're doing now.

I think going back to the Chair's point, we have shared information on where we are in the process and like shared names of,

or not shared information on how we're going about it, what firms we're using to do the consultation.

I don't think that the regulations would allow us to make a joint London -wide decision on this and the SIV certainly recognise that

because they're giving free options. So if this is another complication to it, we could decide that we want exclusions.

After consulting, it could come back that people want exclusions to the nth degree.

So one of the things being cited is any organisation that's involved in a particular conflict area,

which might include, for example, Microsoft, whose software is being used to pilot drones in the region,

but is also being used to pilot drones in other regions where there's no objection to it.

So there is a heck of a lot of complexity around this whole issue.

What we have taken advice from investment advisors that say there is a small adverse impact if we

went with the highest level of exclusions that the London SIB are saying they are willing to cater to.

It would be legal for us to make the decision to go with the highest level of proposed exclusions

offered by the London SIV if we had support from stakeholders in the fund.

So it is very much that our next step, if we want to do something, is to canvas stakeholder

opinion and then take that to inform which of the pillars we decide to opt to. But it's

very much, we need to consider all views in this and that's why we're coming to yourselves

with the question of what sort of things do you think we should be considering.

So I think, although we didn't want to link to a survey that we know it's not going to

go out in that final format and we didn't want members of the board to start looking

at the detail of it, there are overarching themes in the survey and that the SIV are

exclusions on. So they are things like fossil fuels, controversial weapons,

which is things like anti -personnel land mines, things like that,

that often impact civilians, cluster bombs, raging up to any sort of defence

company at all. There's issues around, I always want to say, public bads. So things

like things that can have an impact on people's health,

so physical health as in smoking,

things like alcohol, things like that,

and then mental health, things like gambling.

So should we be investing in that?

More controversial lending companies.

Carl, haven't we looked at some of those anyway before?

There was quite a few years ago there was some consideration of making those levels of exclusions.

They have been talked about at borders, potential exclusions as part of this responsible investment.

But it's really what we need to now nail down is the list of areas as in gambling, alcohol, pornography,

what any defence organisation whose income is more, sorry, any firm that has over 10 % revenue

associated with defence sector, you know, it's that list of yes, no items that we need to write

the survey on. So that's what we're trying to get to the bottom of now to make sure that we've

consulted with everybody, including yourselves as member and employer representatives, to take

views on board because one of the things we don't want is for people to come back and say the survey

was invalid because I couldn't say I would like X to be excluded. So obviously people can only,

when surveyed, they can only answer the questions in front of them. We need to make sure that the

list of options in front of them is as complete as possible and that's part of what we're asking

you to make sure we've got the right list, that we've not missed anything off of it.

So if there's anything that I've not mentioned or anything that you as, and this is yourselves as individuals and those of you who are employer representatives as well, what would you like to see on the list of things to vote for or against investing in basically?

I think if you personally if you if you strip it back to looking at it more holistically

I'll skip my neck out and say most members will want us to be

investing as ethically as possible across the widest range of possible areas provided it had

minimal fiduciary impact and if that's pillar C that's pillar C. What goes into pillar C

well, the list is endless. I'll copilot it and say, right, give me a list of everything

that should be covered in this and then we've got a starting point. So the bigger picture

is making the right call. Within that there's the layers that make up making the right call.

um so thinking just broadly um we are probably and I think particularly younger people um people

working going into the workplace these days they're going to be thinking more I want to

do these things correctly for the environment for everybody's health for everything else

and if it means we don't make quite so much money out of doing it then then so be it

That's probably going to be what we would find from any response to the member survey.

And I think as employers who have a number of those people within their organisation

then as an employer you are doing the right thing in supporting your workforce in considering

that direction too.

Where I do struggle with it is being then told, well, what should be on that list?

And I think that's quite a tough task for us to say, well, actually, this is on there,

but that's not.

It gets too involved.

And I think that's personally beyond our brief, really.

There should be others who are putting those lists together.

We shouldn't really be being asked, is that one right or is that one wrong?

From the general point of view, I think we do have an input.

We do have a say and I'll probably put my cards on the table as to where I'd be with

it.

But yeah, I've been on this board for many, many years and it's moved from a fairly straightforward

set of instructions to one that's become far more complex over the years and I'm quite

happy to be part of that. But I do think that the level of detail we're being asked to consider

in this and to give an opinion on is quite worrying personally. But the general bullets

of what we're being asked to do I'm quite comfortable with and quite comfortable for

us as a board to have a view on.

I just think it's getting very deep and very difficult if we go into it in the fine detail

we're being asked to consider.

But for the spirit of things we'll go along with it but it's a big ask on us to be able

to say what components fit this one and what components fit that.

My view?

So although we didn't want to share the whole survey with the board, I can tell you the

key areas that we've got in the survey at the moment.

And if there's anything that you think should be on that list, and isn't personally, there's

no right or wrong answer on this.

it's really we're just asking everyone's, we're consulting as much as possible.

So we've got climate change, we've got promoting human rights, like avoiding sweatshops, child labour,

etc. We've got whether we should be investing to deliver financial returns, which is more of a

tricky one to define. Adhering to corporate governance, so that's around the G part of

environmental social governance.

So looking at whether companies have good processes in place,

have inequalities policies, things like that,

with promoting female people of colour to the board level.

Looking at investing locally,

for positive local and community impacts.

So like investing in affordable housing in the area.

Should the fund be avoiding companies

which focus on the manufacture or selling of weapons, including weapons components,

looking at protecting animal welfare and endangered species, so getting a more

wider environment type things, goods and services that can be harmful to health,

so that's the gambling tobacco type issues, investing in more ethical and socially

responsibly focused companies. And then a question around

investing in companies that support military defence of the

UK and NATO allies. Because, like I say, when it comes to

defence companies, there's two sides to it. There's companies

involved in things that the individual doesn't agree with,

and companies involved with things that the individual does

agree with. And it's, it's a very, as you can see from that

list, it sort of contradicts itself as well. So these are just things that we want people

to say whether they want us to be considering these things or if we just want to go for

the most money, which is actually an option on the list, focusing on the financial returns.

So what else might people want to have a vote on? What people want to see on that options

list is really what we're trying to get at here and get as many opinions as possible

to make sure that we're not limiting the choices of the people who are answering the survey. So

if you feel that list is comprehensive, that's fine. If you think there's something that you

personally would like to vote on that isn't on that list, please let us know.

Can I just ask a question about process in terms of how would we analyse the information

once we get it back because potentially you know if you've got quite a low return rate

on 44 ,000 you're going to have a lot of surveys, a lot of different views, how are we going

to weigh those and how are we going to weigh those against the employer views as well as

you know the financial impact on employer contributions potentially there.

Because for me if this is informing the refresh of the funding strategy isn't it really but

Yeah, I mean, exactly that is.

And then the other points I suppose I felt looking at the draught survey that went to the committee,

I felt there's a lot of information there. I know we've got to provide context, but I'm not sure what sort of hit levels you're going to get on that sort of survey the way it was written previously.

whether it's much more just open questions that people then just provide a range of responses to

and then you do some sort of mapping of those responses rather than very specifically

driving them down particular routes, I don't know.

No, no, no, that's useful feedback because as I say there is a group who is looking at revising

this survey at the moment. So very much welcome any feedback that I can feed back to that group.

And you are part of it, we all are part of the target audience of this survey.

So it's good to hear another point of view on it. I have shared my personal point of view with Paul.

So yeah, I think that is valid looking at the way the survey is laid out and I think you were saying the volume of information there and whether to sort of strip it back a bit and say are you in favour of X, Y, Z or...

Or giving people the opportunity to, in a free text element, to suggest what they want really and then trying to do some sort of quantification of that.

Yeah, I think in the version that went to committee or the last

version that I remember the detail of, there was a free text box at the end, so

if there's anything else that you would like us to consider that we've not put

on there. I do feel that there will be a number of responses naming certain

regions or certain regional governments, which we will not be able to do because

we, our understanding of the legal position is that we cannot name a certain region because that's

against legislation that we have to follow. But a broader decision on human rights issues is

something that we can say. So yeah, in terms of how we weight it all, I'm not sure, I do not have

answer to that now. I know that in terms of the company that we have engaged to look at surveying

the membership of the fund, they will have been looking at a lot of data on the demographics of

the membership of the fund. So in the annual report, we've published a table of the number

pensioners within certain age ranges. So they'd be trying to get representative samples in terms of

age range, any other demographics that we have, like an equal number of currently employed versus

current pensioners, things like that. They will be looking to get statistically significant,

but yeah, it is acknowledged that we will get a very low response rate most likely.

and we will have to extrapolate from that, assuming it's typical and that we've done these things like trying to get representative samples to make it typical, based on that.

In terms of employer versus membership waiting, I don't know the answer to that at the moment.

It's of course a very good question because the fund members will pay the same statutory

contribution rates regardless of the decisions.

the employers will have to make up any reduction in returns based on this decision.

And that is something that will indirectly or more directly impact the membership of

the fund because if, for example, you are a pensioner, you vote for something that reduces

return of a pension fund, that means that you live in the borough of the administering authority for

that fund. That's going to increase the costs of the administering authority, which will impact,

or is likely to impact the level of services you receive as a resident. Possibly not a level that

you would notice as a resident, but there is that sort of look through. So yeah, the waiting of the

views is going to be quite important. I think that was addressed in the

King's Council's advice but I don't know if actually I suspect it wouldn't have

included actual percentages and weightings but there will be need to be

decisions taken on the weighting of that and also the considerations of the

committee who are making the decision. So this is all information to inform the

decision of the Pensions Committee. So yeah, they will have to make the

decisions on what they want to weigh up, as it were, having taken King's Council's

advice and advice of officers and things like that. So, but I'm not exactly, I

can't give you an exact answer on how they will weigh up the different things

at the moment, I'm afraid.

I think then just to compound it even further, once we've done our own exercise on this and

we're happy with the outcome, we're then feeding that back to the London CIF, along with everybody

else doing the same thing. So there's another filtration process going on at that stage,

and presumably it's then incumbent on them to arrive at the final set of investments

that are left on the table at the end of that whole exercise.

It does seem completely bizarre.

It is, as you say, people aren't going to get exactly what they want.

That is one of the general things coming out of pooling it anyway.

The London SIF cannot cater for 33 individual investment.

In fact, I'm halfway through reading some of the new regulations and it does make the

point that the pools, actually, I think it says somewhere in the regulations or the guidance

that you can get or the pool could offer you exactly what you want, but the pool will ask

you to pay for the additional costs of getting exactly what you want at that point because

part of the rationale for the fit for the future and the move to pooling is to reduce costs,

to reduce the leakages from all these little individual things, to have the economies of scale

benefits and the benefit of having the expertise in one big organisation with expertise

rather than lots of smaller organisations buying in piecemeal.

But the London CIF is currently offering us three pillars to choose from.

What the London CIF should do, because I believe I've read somewhere, and I'm getting confused

between draught and final guidance, is that the pools have to try to implement our responsible

investment policies as far as they can or have regard to our investment policy.

So if all London SIBs authorities go away and survey members and

members come back and say we all want an exclusion on AI because AI uses so much

energy it's bad for the environment so we want to exclude all AI companies the

SIV would need to then take that feedback on board and look at the fact that in fact

we couldn't because the returns from AI companies. This is a nonsensical example

because we can't do that because that would breach the minimal financial loss.

But if it was something like that, the SIV as a pool would have to say

well all my members are asking for this, is there a way that I can provide it? And

that's the way that it theoretically will work. Obviously it's not been tested

yet. So we can all vote for stuff that the SIV aren't currently offering and if every fund comes

back and asks for it, in theory the SIV will try and provide it. But it's not going to be a quick

solution. The SIV have now come up with the three options that they're offering us on responsible

investment to choose from. They don't necessarily have a wide choice of investments that meet any

those that fit into all of those buckets as yet, buckets, pillars as yet. So even if we did make

the decision that some of these lobbying, that these groups who have spoken at the committee

have asked for, I don't think that the London Civ is in the position to fulfil that request

fully at present. It's going to be a long process moving to whatever we do.

But yeah, there's a lot of decisions being made that may or may not, or views being asked that may or may not come to anything at the end of it because of the fact that we can't act on our own anymore.

We are part of a pool, as well as whether we as a fund have the same views as other funds in London.

Any other comments from colleagues at this point?

So, sorry, can I just ask...

No, no, it's just not in the call.

So I was just going to say, in terms of consulting with employers,

would the employers on this board think you'd want to see the same survey as the fund members,

or would you want something different?

Is there a good time or good method to contact employers just generally in terms of the process of consulting?

I think I go back to my looking at it more simply in terms of what options or what opportunities

it's given to our employees and if we feel the process is giving them a say and giving them a

say that's clear to them in terms of they're making a decision in this direction which

might impact that decision in this direction.

As long as people are clear with what they're being asked to do, the impact that their choices

could have.

I think we as employers probably have a role to explain that if it's not clear to them

in the first instance with a covering letter or email or whatever.

There's that aspect to it.

I don't think the minutes...

For yourself as having your own vote on this, because obviously as employers you are on

the hook as it were for any increased contributions as a result of these decisions.

So we need to consider the employers votes as well on this.

So how would you want to be asked to vote?

Well if you go back to your list that you gave earlier on about 12 headings, if there

was minus 5 % investment on that one or plus 4 % investment on that one, so if there was

a guide as to you're looking at this sort of reduction in investment return, if you

tick that box or you're looking for an increase in investment if you go this direction, if

there's something along those lines could be worked up by somebody, that would be a helping,

that to me would be a helping hand. For a member to say well actually yeah I do like this,

I know it's going to cost a fortune to do it and we're going to move from 131 % funding level down

to 92 as a result of it, then clearly that's something we need to try and avoid.

So it's a very dangerous game we're playing isn't it?

It's a bit like the game of poker in a way that we're giving people a chance to play

at the table and we're playing with the employer's money, we're paying with the members are going

protected because of the way the scheme operates but it's a difficult one because I do think

members will want to go for everything that is within the ethical boundaries and rightly so,

to a degree, but we as employers have an added thought to say well hold on a minute what impact

this going to have on us and our funding abilities to be able to sustain it. So I personally as an

employer or an employer would like to see what the members are filling in and struggle to see how

a different set of criteria apply to the employer but the employer's one that probably more is

probably more straightforward in terms of would you support everything that's going

to fit within pillar C if it's going to have a 10 % reduction on the funding that's obtained

from investments?

Would you go for B if it's going to have plus one or two percent either way, plus or minus

one or two percent either way or would you rather go for this one which is going to give

us fantastic returns and make us even more cash rich?

If it's something as simplified at that sort of level, that's probably more of what the

employer would want to say.

And then the member level, it's more granular in terms of, well, here's your chance to put

this charity at the forefront of your thoughts in your return.

And that's where it's going to get daft.

If somebody's got anything else you'd like this to cover, and they put their little sort

backstreet cafe around the corner that do wonderful things for the local community,

that's never going to get a look in because there's only a few people that are going to put

that down. To me it seems very complicated in terms of how it's going to arrive at something

sensible on either front really. I would like to add something please. So if for example we

discussed at the beginning that we have got the pressure groups of different unions and who wants

to see some actions and as Hillary has also discussed, some other local authorities have

gone forward. As far as I know, my local authority currently is on the survey stage as well. So,

My question is, do we give in to the loudest voice or do we let good governance give us the rationale of doing what we are doing?

So it should be, we shouldn't be like, if there are loudest voices who are trying to say,

we want this, we want that, we want this on the list, then they should present what list should be considered.

Like the list, the choral you have presented, I think this is quite reasonable.

As a member, I'm happy to stay on the reasonable side where we will be ethical as well as we

will have some cash, as the chair has said, rather than going cash poor and going 100 %

ethical.

I don't know if I'm trying to understand what I'm saying.

is that we have to let governance act as well here

rather than loudest voice sometimes?

Yeah, so I think maybe that's...

So part of the reason for doing a survey

is that we are hearing from people who are, as you say,

very keen to get their voice heard

because they are coming to the committee and presenting.

We don't know how they're claiming that they represent the views of members,

but we don't know until we send out the survey. So it might be that yes, everyone wants to stop

investing in

weapons, or it might be that people just want to have no concerns about weapons.

people might come back and say we want more money invested in things that help the local community,

like affordable housing, so people who have concerns around that. We don't know until we

ask the question. We know the people who are going out of their way to make their voices heard are

saying they want this, but we want to get that balance. So part of it is to get that information

on. They're saying people want this. Do people really want this? Get that fact cheque that

they're only asking the people who are part of their union. There might be people who

aren't union members. We want to make sure everyone's voice is heard, not just the voices

of people who come to committee. It's very much about making sure that we engage and

consult with everyone and everyone has a chance to give their view.

I think it's interesting that you said that you want

to be ethical as long as it doesn't cost too much.

Is that a fair summary of what you said or?

No. So the way I said it was that,

so if going ethical, how the chair said before going ethical,

if it means we are going to end up with no kind of pension or something, if people are making those

choices, then they're saying that I'm okay with that. Just don't invest in that sector or in

defence or something, but I'm okay with having no pensions. So it's almost like if people are

deciding that but some of I might not be happy with that. I might not be happy with that view that

Okay, we won't we won't

We won't have we won't invest in defence, but as a result, I will have no pension

So, you know, that's what I'm trying to say. So there might be completely different views for people on this

Yeah, and that is that is well

That might be what comes back out of the survey, in which case the committee will have that

information go, there is no clear majority view on whether we should invest in this or

not.

And then it would come down to the committee on what their view is, I feel.

But I think it will be useful information to have the survey to inform the committee's

decision making process because the committee will have to make the decision based on what's

in front of them.

So they will need to see the results of the consultation and say,

this is giving a clear steer or possibly there is no clear steer or people have

voted for two things that you can't have both of them.

So people might be saying we want you to make a good return and we want you to

divest from everything.

And that's all information that the committee can then use to make the

decisions. I think they want, to my mind,

it's going to be a useful information either way,

even if it is the information that there is no clear steer from membership

or from employers.

So do what you think is right as the Quasi Trustees of the

scheme, which for them would be to go with the fiduciary duty

possibly, because that is clearly the overriding thing.

Thank you, Coral. And also, as the chair mentioned,

If we could have something, so for example, if I get a survey, so if you say we do divestment

from this sector to here, and that will decrease or increase your pension by this, I think

people should know what will be the implications as well, then they will make the right decisions

because out of kind of like activism or enthusiasm, people can say, yes, I want everything ethical,

but when it comes to actual numbers, the results will be drastically different.

I think there's good points now, but I think the members will look at it differently to employers.

Essentially the members have a free hit with it. If there was a list of 12 things on that list,

of let's simplify it here are 12 areas we want you to vote on and suggest and just put your

first second third choice simplify it so it's a nice simple return that people could have they

say return that to you if you've got whatever maximises the return for the scheme on that list

to the members and then they realise well does it mean is it going to impact my contributions no

you'll still pay the same contributions. Is it going to impact my pension at the end of the day?

No, I'll still get my pension. No one's going to pick that because there's this guarantee.

The impact is on the employer if everybody makes the wrong decisions which takes too much out of

the fund. So to me having that on the list is ridiculous because they're going to think right

which of these ethical options or more ethical options am I going to pick? And if you've got

12 items, 10 items, keep it simple, don't give people the right to put their own little bullet

points as to which particular charities or organisations they wish to have under that

umbrella, just tick the umbrella. Three options, keep it simple for those who then get the ballot

boxes back to say right what do people see as the key areas that they want. Then that goes back to

once that's finalised, we've done our bit as the ones with jury, here are our results.

Then the SIV has to say, right, you've picked those three as your key categories. That then

translates to investing in this company. So we then need to find out from the SIV, the

investment gatekeeper, well, it now chunks down into these areas. We then go back to

our members and say, thank you very much for everything you suggested. We've taken your

views into account. Here are the three areas that were the most popular. We are now, we've

now put that forward to the London SIV and they've acted on that. We can then go back

to all these organisations and all our members to say thank you for what you've said. We've

done our bit in overseeing that it's done fairly and SIV have acted on that. Everybody's

happy going forward. Now, how achievable is that? Because I think that we're getting too

involved without being able to give people the appropriate reassurances. So somebody,

if you gave everybody that list of 10 and they voted on all 10, then again, that's ridiculous

because they're saying, right, well, here's my one, two and three, but here's my four,

five, six, seven, eight, nine, ten.

I'm all trying to keep these things simple and understandable

and if it was something along those lines,

we're much more likely to achieve an outcome

that keeps most people happy

and understand how we've arrived at that at the end of the day.

But there's no point giving members to say,

on, well, it might reduce our 131 % funding level down to 115 as a result of that.

They'll say, well, it's still 115.

What's wrong with that?

Uh, we're still, we're still in surplus.

Um, doesn't bother me.

There's enough money to fund my pension.

That's not going to affect my contribution level.

Um, that's of no relevance to me.

They, this particular funding weapons to have wars the other side of the world,

much more important to me than having lots in the coffers to fund my pension at the end of the day, as long as there's enough there to do it.

Thank you, Chair, for explaining.

Well, I don't like my view, but...

So I don't know if you can make any sense of all of those contributions, Coral, but I think it's been a good discussion for us to have.

um and probably gives a bit of a steer as to maybe how we're thinking um but but yeah it to me it's

too complicated at the minute and then it's too fraught with problems that it's not what's going

to come back is going to just keep it too confused um yeah that's what i think

Anything else want to comment while we're on this very minor topic?

No, should we move on? Yeah. Good, okay then should we move on to the next bit then,

the government and investment update. Are you doing this one as well Coral?

Yep, this is me too. This is why Martin got to do the training because I get to speak during the meeting.

He's got to have his lunch now as well, that's good.

He looked like he was at an event of some sort.

Yeah, so we've just spoken about governance a bit anyway.

So at the moment we...

Sorry Mel, I'll make a note of what you've written in the text.

and make sure that's fed back as well if that's okay. So yeah, so we're moving on

to governance updates. So there is a lot going on in terms of governance at the

moment in terms of implementing the requirement to have all our

investments made via the pool. So that is progressing, I feel it's progressing

quite well. So we have signed over the management of all our investments to our

local pool, London SIB, and they are now managing all our investments for us.

They've reviewed the investments in line with our high -level strategy. So, sorry, I

should probably take a step back again. I'm thinking about my lunch, that's the

problem. I should take a step back for our new member. So under Fit for the

future and all the changes arising from that. The decision making that's left with the local

with the administering authority, which for us is via the Pensions Committee, is to set

a high level strategic investment asset allocation, having taken proper advice, which we did before

the requirement to take that advice from the pool came in. So we have set our strategic asset

allocation using Mercer's advice as our investment advisor. And that just, so our decision is that we

will put 50 % of our investments into equities. We will put 5 % into index linked gilts, we'll put 10 %

into property. So it's that very high level decision, which is then implemented by the SIF.

The SIF have now taken on management of our existing investments, have looked at what

we reset our asset allocation to in December and have come up with a plan to move from

what we've got invested at the moment to what we want to have invested in our high -level

strategy.

I can't share the detail of that because obviously if they're looking at selling investments,

buying investments that could impact on managers. But there is a plan in place, it's been gone

through with officers, officers are happy with the plan. There's not a lot of changes going on in it,

actually at the moment. And as I say, just picking up on the earlier point,

although we've not changed our allocation to equity, the way that's being invested by the

will change to address the performance issues that we had identified. So the SIF are progressing

with that. They will also be providing our performance reporting from the next committee.

So the performance from the 1st of April to the 30th of June will be provided by the London

SIF now. And we are having a lot of discussions with them. I've been going through the details

of our cash requirements because we retain management for our operational cash. So the

administering authority, my team, need to make sure there's enough money in the bank

to pay out the pensions. We need to collect in the contributions from the employers and

employees every month. And then because there is an ongoing deficit on dealings with members,

So the contributions coming in aren't enough to pay for the pensions payments going out.

So we are always cooling down a bit on our investments. So that means that the mix between

investment returns that reinvested to help grow the fund and the returns that we have to cash out

to pay pension to top up the bank to pay pensions every month. So that's the quite a high level

explanation of all the detailed working papers that I've got that fully justify my full -time post.

And those are my team. There's a lot more detail behind it, but that's the high -level

concept of what we're doing. We're monitoring that. And as was picked up in points in

the annual report earlier, there's a lot of unforeseeable cash flows. So for example,

I put together a cash flow budget that says we think there'll be X transfer values out.

As we've discussed earlier, that's probably going to be wrong.

Goodness knows what it will be.

It's very hard to predict the exact figure, but you have to make an estimate and go with

it.

So all of that has been shared with the SIV and they're looking at taking on management

of our investment cash soon based on the amount of information we've been able to share with

them.

So that is also progressing. So that's the actual implementation of the pooling

and the pooling guidance. We also have now received the guidance around the

other areas as well. So we've now got more detail on what I put in the report.

There were two statutory instruments that amended the pooling requirement

and the governance of the scheme. We've now got 70 pages in total of detail to plough through

and look at. This was received after the report was published, so I didn't have a chance to add

it in, but I will come back to the next board with more detail around that and an update on progress.

In the board report I've put down the key points that were in the statutory instruments,

some of which we have progressed, some of which we haven't progressed yet,

partly because we're waiting for guidance to be able to progress them. So for example,

we have to appoint an independent person and hopefully somewhere in that 70 pages

there's some sort of job description as it were for that post so we know how to go and

what sort of person we're looking for and we can meet that requirement.

So yeah, the guidance has now come out. So the report is unfortunately out of date

because that has come out.

But we've got a meeting in the diary now, the guidance has come out, officers are going to look through the guidance and I think Martin

mentioned this as well. We have a meeting.

we can then say, well, the guidance says this is what we need to have in a training strategy.

We can go and revise the training strategy and bring it back to yourselves to review and comment on

prior to it being approved by Joint Pensions Committee. So that's where we are at the moment. I think

I said in the report what progress we'd made and the item that sticks in my head is the appointment of the Senior Responsible Officer,

which is Paul Giuliani.

was appointed at the last Pensions Committee and also, as I mentioned earlier, the transfer of

management of our investment assets to the pool. There's other things that we are working on at

the moment, like the Responsible Investment Policy, which will be part of the investment

strategy statement that we are updating, which needs to be consulted on as well. So not only

being asked to consult in the survey to inform the responsible investment policy, you will then

be consulted on the content of the investment strategy which will include that RI policy

once it's agreed upon. As I've said earlier and I will say again there's going to be a lot more

consultation via local pension board on these strategies coming up.

So there is a checklist in the appendix that says what the requirements are under the new

regulations, what the deadlines are, what progress we've made to date, and that will be updated and

brought back to board every board meeting so you can track progress, see how you feel officers are

on that. I don't know if you have any comments or questions on that.

Chair, there is a lot of changes and requirements of this board and I really wonder whether

the amount of documents and understanding those, the content,

that we may need more meetings as was muted earlier to actually give items a bit more time to mull through

because it's quite a lot for us who are not actually working, actually doing the work to

give some clear directions to workers. So I kind of feel, oh, there's more, there's more that we

need and I'm not sure if we've got enough time to look at those new areas that are coming through

for workers as well because they're having to be processing new areas of work and being able to

sift through that and present it to us and us only having a week to read all the documents and

and be really helpful to workers.

Sorry, that was a bit long winded.

No, no, I think I understood

and share your views on that, Hilary,

that a lot of what we already have in place

is up for quite fundamental change,

all roughly the same sort of time.

And when I looked at the timescales in Appendix A

and there's some leeway in there,

because there are some, there are different dates attached to different requirements.

I'm conscious we've been almost three hours already and hopefully we'll be done roughly

half past two -ish if we run through the risk register after this. But there may be potentially,

and I'll throw this back to you, Coral, to talk through with Paul and others.

There may be the need for an additional meeting at some point. It were to be the case, I would

want it to be something that is not one that lasts this period of time and that there is a

manageable amount of paperwork for it to be gone through in advance of this. So if fitting in or

finding a date for an additional meeting achieves that so that there's a shorter, specific focus

on several of these policies that are more urgently needed to be reviewed, then that

is something I think we should consider doing, but be guided by you on that. Some of these

give, as I say, there doesn't seem to be any that are, apart from the training one, which

seems to be a more urgent fix if whatever changes are recommended from that.

But yes, some of these have longer dates on them, which hopefully can be slotted into

our usual meeting slots in a manageable number each time.

But I think underpinning your comment, Hilary, is that you've seen what I've seen over recent

meetings, there's a growth in terms of what's on our shoulders to give time to make comments

on and put in place new documentation. I'm happy for that again, but it needs people

to understand we all have busy lives, we all have other jobs that we are all doing, we've

done their other jobs and are doing other things on the sidelines now. So it doesn't

seem to be taking that into account. This seems to be becoming more and more professional

in terms of what they're expecting pension boards to do. I don't think we're in a position

to be able to change that, but I think I'm quite happy for that to be noted in the minutes

that this is certainly my view. I think, certainly, Henry and Mel, I think you probably would

agree with that too. I'm sure Peter would. So, against that backdrop, maybe if there

is a need to keep the agendas manageable and to a manageable period of time going forward,

if there is a need to consider an additional slot to make it four meetings over the next

year and then maybe even the following year after that if it takes that to get through

all of this loading, then maybe we should do that.

My view on that is that hopefully at the end of that period it's a quieter time when we

get back to how it used to be, but if it's going to carry on like this, I don't know

whether colleagues will be in it for the long haul.

But yeah, that's not a bribe, that's not blackmailing anybody, but it's just the feeling as to

Okay, I understand why this is happening at this current moment in time.

If it's a one off, great.

If it's the sign of things to come over the next three, five, ten years, then the original

people who have signed up to do this are possibly the wrong people for it longer term.

But the long and the short of it in terms of this, where we're at at the minute is yes,

if you wouldn't mind looking at what's involved in this, picking out the things that are going to be

the urgent ones to do and if it needs a meeting in advance of November, fine, we can look at that.

If it's something we discuss at the November meeting to slot another one in somewhere

that isn't currently on the schedule, then again let's look at doing that too. But yeah,

it's a lot to be done. We're up for doing it but let's try and do it in a manageable process that

everybody can give the right amount of time to do and if that's smaller chunks then that probably makes sense.

Colleagues agree on that?

Can I just and I don't know if this is

possible, but I just want to get your views and I can go and investigate if it's possible.

Obviously consulting with the local pensions board could be done

via just sending you all a document and asking for feedback.

Do you prefer to have discussions at a board meeting,

or should I look into the potential to just send a document

and collate views from individuals as a result of that?

Would that be something that you would want to look into?

It's an option, but I do like the fact that we're all able to discuss together.

So maybe the better option would be if we've got three or four documents and that's the

agenda that we've all got a week in advance to have a look through and they're sort of

20 page documents, each one that sort of length.

and then we'll all get together and discuss those and that ticks a box and gets those

three or four documents done.

That probably is a better way forward but have a discussion at your end and then let

us know.

But if it takes the weight down on our main ones that we've sifted out three or four

policy documents that we can do as an extra item for the next day then then let's maybe look at that.

Okay all right um so thank you for that and I'm also wonder out that that I am absolutely

mindful of the impact that that's having this is having on you Coral so I'm not saying

poor us pension bull people um I absolutely know you're you're you're doing all the hours god

to try and get these things out to us, so we're actually appreciate that.

Thank you, yeah I mean absolutely there is a huge volume of work created by the

changes that are going on at the moment and obviously it's impacting yourselves.

The size of the agenda is the lengths of these meetings, so yeah if you

would prefer to have one more and keep agendas short we can certainly look into

possibility of that going forwards.

But yeah, it was, yeah, yeah.

I'm not sure if it'd be better.

Because there are a number of changes that have, you know,

been added to discussions and we need time to, you know,

to read and discuss and to be supportive to staff group,

as well as to the organisation.

So yes, I'm supporting what Michael's just said really.

Thanks, Hilary.

So I think if we move on from there,

we're onto the last item, which is risk management.

Coral, did you just want to, for Narmian's purpose,

did you just want to explain that our main focus

is just the first of the risk registers

in terms of the pension fund itself and that we receive the service funds as an extra item

to just spend more time reading.

Yeah, I think you just did for me, Chair. Thank you very much. So yeah, this is the

risk register. The pension board have delegated responsibility for managing the risks of the

pension fund from joint pensions committee. On that basis, the risk register comes to

board meeting. We have always added the service risk registers to give the board

assurance that risks are being considered in services. We add the same

one every board meeting. If the board would prefer to only see them if there's

a change or to have links to the documents elsewhere or have them

circulated instead of part of the agenda, I would be happy to consider other ways of

the board looking at these supporting documents. But basically, Appendix A is the one that

you are being asked to review. It's the risk register for the whole of the pension fund.

I highlight in red the bits that have changed. There aren't any major changes. There are

some amends where I've got further information on pooling, but it's very much the majority

of it is the same as the board looked at at the last meeting.

Thanks Coral, yeah I support what you said there in terms of if there is

no changes on any of the service area ones from meeting to meeting then I don't

see the need for those to be included in your paperwork for this particular meeting but

but clearly if there's any alterations,

then I think that it is very useful to see those.

Purely on the basis that we'll have looked through those

previously anyway, and quite happy with what's there.

So if nothing's changed,

we're still likely to be quite happy with it.

Yeah, I mean, I could instead add the link to say

this was last updated and went to,

the last updated version went to this board meeting,

so you could reference it if you wanted.

If I kick off on this particular one for the fund, I have really two comments.

There are several areas where there is reference to the role of the Joint Pensions Committee

and some of that still overhangs or overlaps with the fact that things have changed there

in terms of what the London SIF does and less of the JPC does.

So I'd imagine one or two of those areas will change in due course in terms of I don't know

whether say risk number two, we've got currency hedge put in place for 100 % credit and 50 %

equity, infrastructure and private equity.

that presumably is no longer a role that the JPC has or have I got that wrong?

I mean the hedge is still in place right it so that because that's more of a cash

like item I think we are still monitoring it I mean the committee will

monitor all of these things as part of its role of raising concerns with the SIV.

Yeah and then above that we've got ensuring there's a diversified portfolio all those sorts of things

those will amend or be removed over time so that and we've just had that long discussion on

portfolio. So those things by nature will either change or disappear. The only thing

I wanted to sort of pick on was just to have in the minutes that we've reviewed, item 11

increased longevity as a risk, which we know quite clearly is a risk out there. And I know

we've agreed these scoreings, but I've reflected on where we've got an impact of three. My

view is that that's probably too high because longevity is one of the areas that actuaries

look at and include in their actuarial assumptions, presumably, at each valuation. So we're, in

a way, we're making provision for that. So whatever the contribution levels agreed at

those valuations takes stock of the fact that longevity is doing this or is doing that.

So I would say the impact is probably best of two because we're catering for it within

the contribution rates that people pay.

I don't know if colleagues agree on that, but I think impact is three is high.

Not that I disagree that generally people are living longer.

So yeah, that's true, but we're not being asked for that.

We're being asked what the impact of that is on the pension fund.

And if the pension fund is, the actuaries are telling us people are living longer, you

need to add half a percent because of that going forward, then we're already making that

provision. So I would argue that impact is lower than three because we're actually making

that allowance for it. I'm just saying that because we've not changed any of these

for quite a while, so that might be one justification for a minor change to one of them.

But other than that, I'm trying to have no other comments on that particular register.

I don't know if anybody else does.

No? The colleague's happy to go with a two for that?

Or does everybody think it should stay at three?

Two.

Two, yay! Risk or a four as a result at the end of the day.

Any other comments at all colleagues? Any other business?

No, in that case at just after half past two but three hours and four minutes. Thank you

Thank you very much everybody for your time and for your contributions.

Thank you, Coral, for doing the bulk of this for us.

It's a mammoth task and you've done a very, very good job with that.

Equally, Martin, for his part, he clearly got the easier end of the deal today.

So don't mind you telling him that.

He often has the more contentious discussion around some of the feedback that he gets.

This time I had the more interesting issue, shall we say, of responsible investments.

Thank you.

Thank you for the discussion of it.

And I will make sure that all the comments on that are passed on to be rolled into the

process for the consultation.

Great, and let us know if we're needed to consider a meeting before November for consideration

of several of these policy amendments, if they're ready for that, then yeah, by all

means do do that. Otherwise, thank you, everybody. Thank you, Michael, for clerking and recording

this meeting and there is still some of the day left for people to enjoy so please get

on with the conversation.

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Local Pension Board - Thursday 2 July 2026, 8:03am - Wandsworth Council Webcasting

Local Pension BoardThursday, 2nd July 2026 at 8:03am