Agenda item

Report FSD15013

The Committee considered a report outlining proposed changes to the structure and governance arrangement s of Local Government Pension Schemes (LGPS) required under the Public Service Pensions Act 2013 and associated Regulations and seeking approval for the establishment of a Local Pension Board.

The proposals had been considered by the Pensions Investment Sub-Committee on 3^rd February 2015 and the minutes from that meeting had been circulated, together with a sheet containing additional recommendations arising from the final Regulations laid before Parliament on 28^th January 2015 and revised guidance from the LGPS Shadow Scheme Advisory Board. 

The Sub-Committee considered that the introduction of Pension Boards in local authorities such as Bromley caused duplication both from an additional layer of bureaucracy and from additional unnecessary costs, at a time of reduced budgets. It was proposed that, to keep costs to a minimum, the Board should comprise only four members, two to be employer representatives and two to be scheme member representatives (these did not have to be members, but had to be capable of representing their interests.

The Pensions Investment Sub-Committee urged the Secretary of State to remove the additional burden of having to set up a Local Pension Board by allowing local authorities with good governance schemes to opt out. The final Regulations included the possibility of combining the Local Pension Board with the existing Pensions Sub-Committee, although criteria and conditions for doing this were still awaited, and Members had considered that this option should be pursued. 

RESOLVED that Council be recommended to

(i) approve the establishment of a Local Pension Board;

(ii) approve the composition of the Local Pension Board as set out in section 3.17 of the report;

(iii) approve the draft terms of reference (appendix 2 to the report) subject to incorporating the following amendments –

·  the Board should meet once a year;

·  in the event of non-attendance, membership will be reviewed (amended from consistent non-attendance);

·  clarifying the process for the replacement of Board members who die in office; Board Members will be invited to attend meetings of the Pensions Investment Sub-Committee.

(iv) delegate authority to the Director of Finance, in consultation with the Chairman of the Pensions Investment Sub-Committee and the Chairman of the General Purposes and Licensing Committee to make any agreed changes to the draft terms of reference as set out in paragraph 3.18 of the report;

(v) agree the process for nominations and appointments as set out in paragraphs 3.22 and 3.23 of the report and that

(a) appointment of two employer representatives be made by Council;

(b) appointment of the two member representatives be formally delegated to the General Purposes and Licensing Committee on the recommendation of an appointments panel as constituted in paragraph 3.23 of the report and in the terms of reference.

(vi) delegate authority to the Director of Finance, in consultation with the Chairman of the Pensions Investment Sub-Committee and the Chairman of the  General Purposes and Licensing Committee to make any changes necessary arising from the issue of final Regulations;

(vii) on the basis that it would provide a suitable alternative arrangement, in consultation with the Chairman of Pensions Investment Sub-Committee and the Chairman of General Purposes and Licensing Committee, authorise the Director of Finance to make an application to the Secretary of State for approval to establish a Combined Local Pension Board and Committee subject to any criteria or conditions that may be applied;

(viii) agree that, should such an application be successful, the Local Pension Board be disbanded and the establishment of a Combined Board be subject to a further report setting out the proposed structure and terms of reference.