Agenda and draft minutes

To receive apologies for absence.

Apologies were received from:

Debby Jones            (Scheme Employer Representative)

Ian Jones                  (Scheme Member Representative)

To receive any declarations of interest.

There were no declarations of interest.

To authorise the Chair to sign the minutes of the meeting of the Board held on 09 July 2024 as a correct record.

The minutes of the last meeting held on 09 July 2024 were agreed as a correct record.

Verbal update from the Chair.

The Chair highlighted:

Item 5 – it was explained that other organisations had established security operation centres (SOC) in which cloud-based teams of trained staff and software feedback meaningful information from data produced from various tools used within organisations.  The Welsh Government along with the company Socura have created CymruSOC for the public sector.

The Pension Fund Manager would discuss further with the Chair of the Board and liaise with the Council’s corporate IT team to discuss intelligent defences.

Item 8 – Ministry of Housing, Communities and Local Government had removed the requirement for McCloud to be reflected in the Annual Benefits Statement (laid before parliament on 28 August and came in to force 23 September 2024).

A joint all Wales approach was taken in the production of the template of the Benefits Statement and would be reflected accordingly.

Item 15 – The Department for Levelling Up, Housing and Communities would now be known as the Ministry of Housing, Communities and Local Government and the Annual Report had been adjusted accordingly.

The Pension Fund Manager would recirculate the Annual Report to Board.

The Chair thanked Gerard Moore for his time as the Chair of Powys Pensions Board.

To note the draft minutes of the Pensions and Investment Committee held on:

10 July 2024.

The draft minutes of 10 July 2024 were noted.

2.6 – The Chair reflected on the exclusion of the WPP and the Welsh Authorities on the recent consultation and felt that forced structural changes, involving pool or fund mergers would be counterproductive at this juncture, for various reasons. 

2.8 – Focused communication to those that have opted out of the scheme would highlight benefits of the LGPS.

The Pension Fund Manager explained that the risk report format had been updated and provided in agenda item 9.

Item 7 – Cllr Lewis hoped to attend the next Joint Governance Committee meeting on the 18 September.  The Board passed on best wishes to the Chair of the Pensions and Investment Committee and glad to hear his health was improving.

Item 13 – The Pension Fund Manager would share the scenarios around cash flow modelling with the Chair.

Updates made with regards to compliance with The Pension Regulator Code of Practice.

The Pension Fund Manager provided an update on the work undertaken since the introduction of the new general code of practice on 27 March 2024.  Assurance was provided to the Board that a full overview had been completed of all five modules.  Clarification was given on how the bar chart indicated further work was needed and evidence was to be provided in line with the regulator’s expectations. For any upcoming requirements or changes the action column provided full explanation of what had been planned.

The Board were satisfied with the progress of the work undertaken considering dedicated resources were not available due to the size of the Pensions Team and agreed with the risk assessment approach taken by the Pension Fund Manager.  It was noted that the modules would be completed by the end of the calendar year.

To receive the Administration Update.

The Pension Fund Manager provided an update on the work undertaken since the introduction of the new general code of practice on 27 March 2024.  Assurance was provided to the Board that a full overview had been completed of all five modules.  Clarification was given on how the bar chart indicated further work was needed and evidence was to be provided in line with the regulator’s expectations. For any upcoming requirements or changes the action column provided full explanation of what had been planned.

The Board were satisfied with the progress of the work undertaken considering dedicated resources were not available due to the size of the Pensions Team and agreed with the risk assessment approach taken by the Pension Fund Manager.  It was noted that the modules would be completed by the end of the calendar year.

To receive the Legislation and Guidance report.

The Board noted the Legislation and Governance Update.  The Pension Fund Manager highlighted:

2.0 Scheme Advisory Board updates

2.2 – hyperlink to annual report for information.

2.3 – preparation had begun for the next valuation (as at 31 March 2025) and guidance would be made available shortly, due to this being a significant piece of work for the fund to undertake. A joint board, Committee and Actuarial session would be held to review timelines and work through actuarial assumptions in preparation of the valuation.

2.4 – good governance project recommendation implementation had been delayed due to the general election.

2.5 – reflected the impact of the good governance recommendations on the five modules held within the Pension Regulator’s new general code.

2.6 -the Board agreed that recommendations would not be made at this time to bring costs down for benefits.

3.0 LGPS

3.1 – name change noted of the ministerial departments.

3.2 – new minister appointed due to change in UK Government.

3.3 – decisions around pooling and the consolidation of funds had not been confirmed, but discussions were ongoing.

4.0 Pensions Dashboards

The portal was a central location for savers to access all pension fund information from different schemes.  The expected go live date was October 2025.  It was noted that campaign communications would be increased for awareness. The Pensions Team had conducted an initial data assessment in preparation.  It was hoped that the process would be automated, and a data upload would be conducted each day.  The challenge for pensions software suppliers of multiple system interfaces was noted.

To review the Administration Pillar.

The Pension Fund Manager explained that the format for the risk register report had been updated for an easier read as requested by the Board.

It was agreed that the register would be worked through in sequence.

ADMIN0001 – accepted by Board.

ADMIN0002 – wording would be updated to provide more clarity, and after further discussion, scores were agreed. 

ADMIN0009 – the scores would be revised to reflect the successful award of the contract as it was felt that the current score did not demonstrate the current situation.

ADMIN0010 – a query was raised around the uncontrolled and controlled status; an exercise had been conducted and regular reviews would take place.  The scores would be revised and updated.

The size, resilience and turnover of the Pensions Team was discussed, although the risk was on the governance pillar of the risk register, assurance was provided to the Board that more details on permanent capacity would follow. 

It was noted that the majority of the Pensions Team had achieved CIPP qualifications, with two team members having recently attained the certificate in Pensions Administration, to which the Board passed on congratulations.

The Pension Fund Manager would consult with the Cabinet Member for Finance and the Director of Corporate Services (the risk owners) and advise the Board of agreed changes.

Resolved:

i.             The Board accepted the paper with the condition that the risk owners consider updating scores and wording for risks ADMIN0002, ADMIN0009 and ADMIN0010. 

ii.            The Pension Fund Manager would update the Administration Pillar of the Risk Register and recirculate to Board.

To receive the WPP updates.

The Board noted the Wales Pension Partnership (WPP) update.  The Pension Fund Manager informed the Board that:

2 Pooling Investments in Wales

2.2 – The WPP had awarded the three real estate investment contracts, after a significant and challenging procurement exercise for the pool due to the wide range of legacy managers for property mandates and the illiquid nature of the asset class.   It was noted that both Schroders and CBRE were existing property managers for the Powys Fund and the WPP also had existing relationships with these Managers.

Powys had benefited from pooling funds within Wales regarding fees and opportunities to invest in some asset classes that would otherwise have been unavailable due to the scale of the Powys fund.

The Chair would attend the next WPP engagement meeting which would be held in Cardiff on the 08 October.

To consider the Communication Strategy Statement and provide feedback.

The Board noted the Wales Pension Partnership (WPP) update.  The Pension Fund Manager informed the Board that:

2 Pooling Investments in Wales

2.2 – The WPP had awarded the three real estate investment contracts, after a significant and challenging procurement exercise for the pool due to the wide range of legacy managers for property mandates and the illiquid nature of the asset class.   It was noted that both Schroders and CBRE were existing property managers for the Powys Fund and the WPP also had existing relationships with these Managers.

Powys had benefited from pooling funds within Wales regarding fees and opportunities to invest in some asset classes that would otherwise have been unavailable due to the scale of the Powys fund.

The Chair would attend the next WPP engagement meeting which would be held in Cardiff on the 08 October.

To note the Data Quality Testing report.

The Pension Fund Manager informed the Board that the scores provided in the report were data quality tests against the expectations of the regulator.

The overall percentage of tests passed for Powys’ common data was 98.5%. The address section of the report was amber due to the report having set data and the information appearing on different lines of the electronic form e.g. postcode.

The overall percentage of tests passed for Powys’ scheme specific data was 93.46% which had increased slightly from previous years. 

The Board accepted assurance that the amber bar for member benefits was due to historical records and the way internal transfers were processed, records would be merged for staff having multiple roles and a cost of one penny added. A data cleansing exercise would be undertaken in due course to correct the records to satisfy the report criteria, and all records were always checked before benefits paid.

It was agreed for the report to be revisited next year and for more details to be provided around volumes and timescales.

The Pension Fund Manager would provide more data and information around the reports to the Board.

To consider the Data Improvement Plan and provide feedback.

The Pension Fund Manager informed the Board that the scores provided in the report were data quality tests against the expectations of the regulator.

The overall percentage of tests passed for Powys’ common data was 98.5%. The address section of the report was amber due to the report having set data and the information appearing on different lines of the electronic form e.g. postcode.

The overall percentage of tests passed for Powys’ scheme specific data was 93.46% which had increased slightly from previous years. 

The Board accepted assurance that the amber bar for member benefits was due to historical records and the way internal transfers were processed, records would be merged for staff having multiple roles and a cost of one penny added. A data cleansing exercise would be undertaken in due course to correct the records to satisfy the report criteria, and all records were always checked before benefits paid.

It was agreed for the report to be revisited next year and for more details to be provided around volumes and timescales.

The Pension Fund Manager would provide more data and information around the reports to the Board.

a)    Breaches Register

b)    Audit Reports

c)    Board Communications Log

d)    Internal Dispute Resolution Procedure [IDRP]

The Board noted the following in respect of standing items:

1. Breaches Register – no update.

The Pension Fund Manager would amend report to remove the section regarding reorganisations in the council.

b.    Audit Reports – no update.

c.    Board Communications Log – no update.

d.    Internal Dispute Resolution Procedure [IDRP] – no update.

2024  -  18 November  /  2025  -  13 February / 21 May / 18 July / 16 October

The dates of the meetings were noted.

The Board needs to consider in accordance with Section 106 [8] Local Government Pension Scheme [LGPS] Regulations 2013 whether it goes into the confidential agenda with the public and press being excluded as some of the information may relate to financial or business affairs of a particular person or organisation.

RESOLVED that in accordance with Section 106 [8] Local Government Pension Scheme [LGPS] Regulations 2013 the Board goes into the confidential agenda with the public and press being excluded as some of the information may relate to financial or business affairs of a particular person or organisation.

Verbal update from the Chair.

The Chair shared his gratitude towards his new appointment as the Chair of the Powys Pension Board.

To note the Performance Management report.

The Board accepted the Performance Reports for periods April to June 2024.

The Pension Fund Manager explained how systems had been migrated and the tool developed to provide detailed statistical information with evidenced data against the key performance indicators. 

Bar graphics demonstrated a snapshot of performance and examples showed how the Pensions Team performed against set targets regarding workload prioritisation, processes completed within set timescales, work volumes and the challenges overcome that determined results. Concerns were highlighted to the Board where certain areas required further focus to improve performance and broaden the reporting profile.

To work through the module provided at the meeting.

The Pension Fund Manager explained that the general code was delivered in a module-based format and within each module a set of questions were required to be completed.  The Administration module was displayed for the deep dive, containing the questions, answers and evidence completed at a high level.

The red and amber status questions were a focus of discussion, with clarification and assurance provided by the Pension Fund Manager.

Due to the considerable number of questions and volume of the documents, it was agreed that an additional confidential single-purpose meeting would be held to review the report in full, followed by elements broken down for formal meetings.

The Board agreed for the Pension Fund Manager to circulate the Administration module in an appropriate format and to arrange a future session.