Agenda item

The Board reviewed the latest update on the LGPS SAB Good Governance project and on the Worcestershire Pension Fund Position Statement: Good Governance 31 08 2021.

In the ensuing debate, the following points were raised:

·         There was a degree of inconsistency in the good governance arrangements for pension funds. It was important that administrative practices were improved to provide clear evidence to the Government of how well the Fund was run and its integrity 

·         Chris Frohlich suggested arranging informal Board workshops on good governance either before or after Board meetings.

The Board then reviewed the identified actions in the Appendix: Worcestershire Pension Fund Position Statement Good Governance 31 08 2021:

General - A3 - Each administering authority must publish an annual governance compliance statement that sets out how they comply with the governance requirements for LGPS fund as set out in the Guidance

·         The Board suggested that before embarking on the identified action of benchmarking against peer funds, it would be desirable for officers to seek approval on who these should be to include LGPS Central partner funds, large funds and funds of a similar size

·         Chris Frohlich commented that the benchmarking should be consistent for A3, C1 (representation) and E3 (KPIs) and that the Fund is likely to be more aware of the approach used by LGPSC funds and funds participating in the Shrewsbury Pension Officers group.

Conflicts of Interest – B1 - Each fund must produce and publish a conflicts of interest policy which includes details of how actual, potential, and perceived conflicts are addressed within the governance of the fund, including reference to key conflicts identified in the Guidance

·         Chris Frohlich suggested the introduction of something like the Appendix 3 Record of Conflicts of Interest Declarations made that members would sign each time they attended a meeting

·         Although the pension administration staff were Worcestershire County Council staff, they were funded by the Fund not the County Council

·         The declaration of Interests documents needed to be SCULPT compliant. Chris Frohlich responded that as he did not envisage the document being made public and he managed the Fund’s website, he was au fait with SCULPT

·         Simon Lewis commented that there was a distinction between the record of declarations of interest for the purposes of the Local Government legislation at each Committee/Board meeting and any register established for the purposes of the administration of the Fund.

Knowledge and Understanding – D1 - Introduce a requirement in the Guidance for the key individuals within the LGPS, including LGPS officers and pensions committee members, to have the appropriate level of knowledge and understanding to carry out their duties effectively

·         Chris Frohlich confirmed that officers collated feedback from members after each training session to drive future training provision with the aim not only of improving knowledge but also personal development.  

Service delivery for the LGPS function – E5 - Each administering authority must give proper consideration to the utilisation of pay and recruitment policies, including appropriate market supplements, relevant to the needs of their pensions function

·         The work of the administration team was very important and therefore staff needed to be able to resourced adequately to enable them to carry out their duties effectively. Chris Frohlich responded that the level of resourcing of the administration team was currently being reviewed

Compliance and Improvement – F1 - Each administering authority must undergo a biennial Independent Governance Review (IGR) and, if applicable, produce the required improvement plan to address any issues identified

·         The Fund must be ready to deal with any potential pilot projects that were forthcoming from the Government.

The Board:

a)    Noted the latest update on the LGPS Scheme Advisory Board’s (SAB’s) Good Governance project and on the Worcestershire Pension Fund Position Statement: Good Governance 31 08 2021;

b)   Suggested that consideration be given to the creation of a benchmarking group; and

c)    Welcomed the proposal to maintain a separate of conflicts of interest register.