Agenda item

This report provides the Pensions Committee and Board (PCB) with the following updates regarding Pension Fund’s administration activities:

a.       Pension Fund membership update

b.       Online Member Self Service portal update

c.       Update on McCloud project

d.       Update on Annual Benefit Statements

Mr Jamie Abbott, Pensions Manager, introduced the item.

The Committee and Board were informed that the most significant

impact of this impending change in regulations would be on operational

activity due to increased workload requirements of the pensions

administration team. It was further noted that a variety of employment

activity data would be required from scheme employers to assess the

impact on individual member pension benefits. The Committee and

Board were informed that the government planned to issue its final

guidance on 1 October 2023. It was expected that this guidance would

provide direction on the treatment of cases were data from employers

could not be sourced. The Head of Pensions noted that the government

was aware of this issue and highlighted the difficulties associated with

receiving this information from employers.

The meeting heard:

- In response to a query regarding what impact the McCloud Project would

have on the Pensions Fund, the meeting heard that not many members

were likely to be affected by the McCloud remedy. This was partly

because where the care scheme being 1/49th was a better factor

compared to 1/60th, the member would have had significant pay rises in

the last 2-3 years to be eligible for the underpin protection. There were

not many members that fell into that category.

- The data that was requested from the employers was the hours, pay and

any breaks in service. This was because under the pre 14 regulations, the

pension was calculated by the service of the member’s multiplied by

their final pay, multiplied by 1/60th as a factor. This changed from 1 April

2014 to a care scheme where the calculation was the member’s earning

for that year multiplied by 1/49th, multiplied by the revaluation factor

(normally the CPI factor), so the service would no longer form part of the

equation. From 1 April 2014, schemes stopped collecting that data due

to this change. However, the data was now needed to make the

comparison between the two pension schemes.

- Regarding the 40% of employers who had not responded, the guidance recommended that the Council perform an educated assumption. For example, if it could be determined that a member had earned £10,000 for one financial year, but had a full time equivalent of £20,000, it would be safe to assume that the individual had worked half of the allocated hours. However, the final guidance had not been issued yet. The government planned on the final guidance being implemented from 1 October 2023. Between this meeting and 1 October 2023, it was expected that there would be a clear guidance which would then be implemented. The government had already recognised non-responses from employers being an issue and Haringey was quite advanced in terms of getting the information. Some employers would have left the scheme many years ago, so it was very difficult to get a 100% return on responses. There was still time, however, to increase the response rate of 60%.

- In relation to a query regarding how many members were using the selfservice

portal, the meeting heard that there had been considerable increase. Initially there had been an 8% uptake. This had increased to 17.4%. Efforts were being made to signpost members to the member

self-service. If members made a request for an estimate, they were

advised that they could do it themselves online to make them more self -sufficient.

- The PCB requested a presentation of the Member Self Service portal. It

was noted that this could be presented as part of a future Investment &

Governance Working Group session.

RESOLVED:

That the Pensions Committee and Board note the report and the

information provided regarding the Pension Fund’s administration

activities for the quarter ending 30 June 2023.