Agenda item

This item presents an independent review of the governance arrangements for the pension fund.

This report has an appendix that contains information exempt within the meaning of Schedule 12A to the Local Government Act 1972 and is not for publication. The appendix has been circulated to the Sub-Committee members only.

Any discussion on the contents of an exempt appendix will require the Sub-Committee to pass the proposed resolution at the end of the agenda to exclude members of the public and press from the proceedings for that discussion.

Phil Triggs (Director of Treasury and Pensions) introduced the report and noted that a Tri-Borough Treasury and Pensions review was commissioned in 2019 and a report published early in 2020. The review concluded that the Tri-Borough arrangement for Treasury and Pensions should continue and a further recommendation determined that officers should carry out an independent governance review of the Council’s Pension Fund. The report summarised the suggested way forward on each of the 32 recommendations as an outcome of the governance review.

John Raisin (LGPS practitioner) noted that overall, this review concluded that the Pension Fund Sub-Committee had since 2015 exercised careful and considered oversight, governance and positive decision making in respect of the Council’s Pension Fund based on the information provided to it. The members of the Pension Fund Sub-Committee had, on the basis of the evidence examined, sought to discharge their responsibilities diligently.

There were however a number of areas where there was scope for clear improvement in the future Governance of the Fund. These were covered in detail in the report. In particular there had been material weaknesses in relation to Pensions Administration. These however did not relate to the approach or actions of the Pension Fund Sub-Committee.

Councillor Rowan Ree queried the reasons for proposing six voting councillors for the membership of the new Pension Fund Committee. In response John Raisin explained that it was recommended that the new elected membership be six voting councillors, and this number was recommended in line with the Council’s current practice across the majority of its Committee memberships.

Councillor Rowan Ree asked for further clarification to be provided on paying an allowance to the Local Pension Board members for attendance at Board meetings. David Abbott (Head of Governance) explained that the proposal was for Local Pension Board members to be paid the same allowance as co-opted members – currently £504 per year. Any allowances approved would be payable from the Pension Fund.

The Chair queried the process and timeline for the creation of the new Pension Fund Committee. In response David Abbott noted that if the Pension Fund Sub-Committee endorsed the new terms of reference, the changes would be made at the next Full Council meeting on 28 April 2021.

Michael Adam (Co-opted member) queried if there had been any proposed changes to the role of the Pension Board. John Raisin (LGPS practitioner) noted that the role of the new Pension Fund Committee would be to exercise on behalf of the Council all of the powers and duties of the Council in relation to its functions as Administering Authority of the London Borough of Hammersmith and Fulham Pension Fund. The role of the Pension Board would be to assist the Administering Authority and there had been no recommendations to propose any changes of the current governance arrangements between the Committee and Board.

The Chair asked for further clarification to be provided on the different timelines for achieving all of the 32 recommendations. Phil Triggs explained that a timeline for each of the 32 recommendations had been set out in the officer report. Phil Triggs resolved to bring an update to each subsequent committee to update on progress made with regard to each of the recommendations.

RESOLVED:

That the Pension Fund Sub-Committee noted the report which sets out the officer responses to the 32 recommendations made by the review.