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The decisions as the council's minutes record them. A plain-language summary follows once it has been written.
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.
Apologies were received from Ian Jones (Scheme Member Representative).
There were no declarations of interest.
The minutes of the last meeting held on 18th November 2024 were agreed as a correct record.
It was noted that any matters arising would be dealt with under relevant items on this meeting’s agenda.
The draft minutes of 27th November 2024 were noted. 4 - It was noted by the Chair that an update on the Mansion House Announcements from the Chancellor would be provided during a later item in today’s meeting. The draft minutes of 13th December 2024 were noted. 9 - A WPP Update would be provided in today’s meeting. 12 - It was noted that good questioning was provided around Waystone and Russell Investments. The draft minutes of 17th January 2025 were noted. This meeting centred around responsible investment with Aon and included discussions on approaches to net zero. 5 - Pension Board would see an updated Responsible Investment Policy, when available, for comment ahead of presentation to Committee for approval. Since the last meeting of the Board, a meeting had been held with the Pension Fund Actuary, to discuss the triennial valuation and responsible investment considerations. Aon also provided a useful educational piece on natural capital.
The Pension Fund Manager highlighted the following: The Governing Body Board Structures and Activities, other actions: Some commentary attached to the questions within the toolkit had been updated. It was suggested that the actions should be revisited and strengthened due to the regulator seeking more evidence as part of the New General Code. It was highlighted that the Pension Fund Manager was happy with the level of compliance and there were no problems to be brought to the attention of the Board. Module 1, Question 1 - The Good Governance Project had been included as part of the LGPS Fit for the Future Consultation launched by the Government in November 2024. The Good Governance Work carried out by the Scheme Advisory Board had been included in this and it was anticipated that it would become legislation in 2025. This point would be updated in alignment with revised expectations following consultation completion. Module 6, Question 1 - There was not currently a Remuneration Policy for the fund, as this was not a requirement within the Code for the LGPS. However, it has been included in line with best practice. Due to being tied to the Council’s pay structure, it was recommended by the Pension Fund Manager that this be explained in the document. It was noted that strengthening was needed around documentation and recording around cyber security. The Chair requested an explanation around the action on page 45. The Pension Fund Manager explained that there was an expectation in the regulator’s code that job titles be stated for members. However, it was previously agreed by the Board that names and contact details were sufficient. The Pension Fund Manager explained that due to the increasing scale of the work needed to run a modern LGPS Fund effectively, further resources were required, and the Fund is in the process of implementing this. The Board noted the report.
The Pension Fund Manager noted that the retrospective Pay award in November was the reason for the increase in Employer and Employee contributions in the table’s column for income. The Chair requested to receive the report with a 12-month snapshot, in place of the quarterly update as it would provide a more meaningful comparison. The Pension Fund Manager to update the report and bring to the next Board Meeting. ACTION The Chair noted that cash flow, including investment income, would be key going forward to asset allocation after the valuation. The Pension Fund Manager offered assurance to the Board that the Committee decided in late 2024 to implement a cash flow policy strategy for the next 10-15 years. It was noted that Aon would have factored the potential negative cashflow, created by a decrease in contributions for the employer, and a prudent approach should be taken to valuation results. The update was noted.
Part of an issue followed across 7 meetings
2.2 – The Chancellor announced the Budget in October 2024, followed by the Mansion House Speech, which introduced the LGPS Fit for the Future consultation on investment pooling and LGPS investments. Consultations on inheritance tax on death benefits could impact administration teams, requiring collaboration with personal representatives to determine tax positions, deduct tax, and pay HMRC. LGPS administration teams expressed concerns to the government about this consultation. The Pensions Officer Group in Wales issued a consolidated response, which was escalated to the National Pensions Officer Group, MHCLG, and the government. An interim report on the first phase of the pensions review was published since the new government took office. 2.3 - For scheme member representative information. 2.4 - The McCloud remedy ensured that scheme members active between 31/03/2012 – 31/03/2022 were not disadvantaged by the transition from the final salary scheme to the career average scheme. Pensions Admin must verify that members in scope were no worse off under the Career Average Revalued Earnings (CARE) scheme. This required revisiting records to re-enter hours, including part-time hours, and performing necessary checks. The McCloud Remedy had been applied to all new retirement and benefits calculated in the remedy period since the regulations came into effect in October 2023. It was expected that something would need to be included within the 2025 Annual Benefit Statements around McCloud, however consideration would have to be given around how this was recorded. 3. – This consultation was issued on the 14th of November, the proposal set out minimum requirements for pooling within the LGPS, such as being FCA regulated and having all assets under pool management by the 31st of March 2026. A comprehensive response to this was shared, highlighting areas of concern, such as taking investment advice from the pool rather than having independent local advice and the potential cost of prematurely leaving existing, long-term investments . Therefore, it was recommended and appropriate, that the long-term investments were allowed to run off and all new investments would be made in the pool. Powys Pension Fund currently has approximately 70% of all assets pooled. Assurance was given that there was reason for the remaining un-pooled assets. The Chair noted that this was an extremely challenging consultation, particularly the timescales for LGPS pools to be FCA regulated and all LGPS funds’ assets being pooled. 3.2 – Updated Funding Strategy Guidance was available, which the next Funding Strategy Statement would have to comply with. 3.3 - The Board was made aware of updated KC’s legal opinion around Fiduciary Duty within the LGPS and it was expected that an updated guidance document produced by the Scheme Advisory Board would be produced to help Committees, Boards and Officers with regards to financial responsibilities within the LGPS. 3.4 – The Chair of the Scheme Advisory Board had written to Chief Financial Officers and the Chairs of Pension Committees in the LGPS at the administrative authorities to ensure that the pension funds were appropriately resourced. It was recommended that additional training resource be provided to help with training. A third party conducted a review of the Pension Fund in 2024 to assess current practices, resourcing levels and identify gaps, which resulted in two significant recommendations focused on resourcing. One was to make a temporary structure adjustment implemented in 2024 permanent, which the committee approved. The second recommendation addressed areas that need strengthening around non-administration-based tasks, which was also approved by Committee The administration team had grown in recent years, but LGPS experience was scarce, necessitating in-house training and development. As the smallest admin team in Wales, the Fund faced challenges as experienced staff had to train new members. This additional resource was fully funded via the Pension Fund. 3.5 - Hyperlink noted to the covering document of work. 3.6 - More work was being undertaken around the transparency of investment costs in the LGPS. 4 - The Pension Fund Manager explained that ‘Pension Dashboards’ was a recent Government requirement and provided background to progress and obstacles associated with developing this by 31 October 2025. The Board supported moving ahead with increased resources at the earliest practicable opportunity.
GOVERN0003 – The Pension Fund Manager noted that Cyber Security was not covered strongly enough in the Governance risk register and it currently sits within the Administration risk register. It was recommended that this risk be revisited and recommendations made to the Pension Committee that it be strengthened. GOVERN0005 & GOVERN0006 – Comments on these risks to be updated by Pension Fund Manager, as fund actuaries had moved away from using bond yields as the determining factor for net present values, except on cessation of an employer. GOVERN0012 – A risk review of employers had been completed and would be presented to the Pensions Committee in March 2025, following which this risk may be updated. GOVERN0016 – It was questioned whether the risk score could be reduced to a 4, due the low likelihood of it happening with Business Continuity Plans in place and the good mitigations in place by the Council. It was agreed that the Pension Fund Manager and the Professional Lead for Employment Services would meet outside of the meeting to discuss this further as well as contact software providers to receive updated security certificates.
A Training Needs Analysis Questionnaire would be shared with Board Members, the results from which would be used to build a training matrix for the Board. It was noted that training was available for Board Members through the Pensions Regulator Toolkit, and the Pension Fund Manager would share the link.
Presented to the Board for information. The Board noted the very detailed Update, including satisfactory investment returns for the most recent quarter. The Board concluded that the Update was generally ‘business as usual’, other than considerable resources unavoidably being focussed on responding to the Government’s LGPS Fit for the Future consultation.
No new breaches had been recorded, and no appeal cases or audit reports had been received in the period. The Board noted the report.
The dates of the meetings were noted by the Board.
Decision as recorded
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.
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.
The Chair moved to discuss item 16.
This item intended to work through the Pensions Regulator Code of Practice. However, due to time constraints, it was agreed by the Board that this item be deferred.
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