Agenda item

Report FSD19106

Under the Local Government Pension Scheme Regulations 2013, the Council was required to publish the annual report and accounts of the Bromley Pension fund for the year ended 31^st March 2019.  In accordance with the regulations, the annual report included a number of standalone documents requiring the approval of the Sub-Committee.  The pension fund accounts  had been audited by the Fund’s external auditor – Ernst & Young LLP - and their report was included within the appendix.  The Director of Finance reported that, as discussed at the previous meeting, there had been a delay in the  audit of the pension fund accounts.  Consequently authority had been delegated to the Director of Finance to publish the annual report, which incorporates the accounts, by the statutory deadline of 1^st December 2019. 

The Director of Finance raised that there is an unqualified opinion on the accounts which provides positive assurance to Members. Control issues had been raised about the use of separate and discreet company codes and separate bank accounts for reporting purposes and, in response to questions concerning addressing this, the Director of Finance advised that, in order to avoid costly manual overrides, this can only realistically be addressed by the future replacement of the Council’s  Oracle financial system. The intention is to implement the required separation with the financial system replacement There is a planned bid in the capital programme which will be reported to Executive in February 2020 requesting resources for the replacement of the financial system, which in its current form would no longer be supported by Oracle in two years’ time. The Director of Finance advised that it was anticipated that the new financial system would be implemented in two years.  Options for joint procurement with Bexley were being considered to help partly mitigate the significant costs of a replacement. There was discussion that the pension fund should make a proportionate contribution to the cost.

Members agreed that it was sensible to introduce the separation of accounting with the implementation of the replacement financial system.  As such, Councillor Fawthrop proposed the following motion:

That the Committee is satisfied that processes are in place to implement a new financial system to address the known issues.  The Pensions Investment Sub-Committee will be provided with regular updates and an update will be included in the next Pension Fund Annual Report.  The motion was seconded by Councillor Allatt.

Councillor Jeal expressed concern about delaying any solution to the known problem in light of the fact that that implementation of replacement IT systems were often delayed/re-phased.

A vote was taken on the motion:

6 in favour

0 against

1 abstention

The motion was CARRIED.

RESOLVED:

1.  That the Pension Fund Annual Report 2018/19 be noted;

2.  That it be noted that no changes have been made to the Governance Policy Statement, Funding Strategy Statement, Investment Strategy Statement and Communications Policy Statement as approved by this Sub-Committee on 24^th July 2019; 

3.  That it be noted that arrangements were made to ensure publication by the statutory deadline of 1^st December 2019;

4.  That the external auditor’s report on the Council’s pension fund accounts be noted;

5.  That the letter of representation for the 2018/19 pension fund audit be noted; and

6.  That the Committee is satisfied that processes are in place to implement a new financial system to address the known issues.  The Pensions Investment Sub-Committee will be provided with regular updates and an update will be included in the next Pension Fund Annual Report.