Agenda item

Report of the Director of People Services.

Includes updates on:

·         Meeting with Surrey County  Council – Outcomes and Actions

·         Internal Audit Update

·         Key Performance Indicators – April 2016 to July 2016

Updates on Annual Benefits Statements and Timelines and Auto-enrolment to follow.

6.1       Jason Bailey (Pension Services Manager, Surrey County Council) provided the first update on this item in respect of progress in addressing pension administration issues. He advised that a meeting had taken place with the Chairman, Council officers and Surrey County Council officers on 3^rd August 2016 to discuss this topic and in particular the fact that the pension administration performance was not meeting a number of its KPIs.  The problems being experienced were attributable to both BT issues of a technical nature and due to there being an insufficient number of suitably trained staff. Following the meeting, Jason Bailey reported that progress had been made in a number of areas, with most matters largely resolved and he anticipated seeing significant improvements for the KPIs in quarter 3 of 2016/17 and was hopeful that most targets would be met. He advised that there was a particular focus in ensuring that retiring staff had their first pension payments made promptly. Jason Bailey also informed Members that there would be more online services available in future.

6.2       Lee Witham (Director of People Services) added that BT also needed to be taken to task about the issues that had arisen. However, the Council was working collaboratively with Surrey County Council and BT in resolving these issues.

6.3       Sarah Hay (Pensions and Payroll Officer) advised that she would be discussing pension administration arrangements with Surrey County Council officers, the auditors and her colleague Kim Edwards (Senior Payroll, Pensions and Establishment Advisor) on 21^st September 2016. She would also be having a follow up meeting at Surrey County Council with Kim Edwards on 26^th October 2016. Jason Bailey added that he was comfortable to have the auditors look at the pension administration processes.

6.4       During Members’ discussions, Members asked if there was any action the Council could take that could assist Surrey County Council. It was queried whether the Council and individual pension scheme members could receive compensation in respect of the pension administration performance and in instances where pension scheme members had received their first pension payments late. The Chairman enquired whether the KPIs performance would be reported regularly to the Committee and were these the most appropriate KPIs.

6.5       In reply to issues raised by Members, Jason Bailey advised that some of the problems experienced were attributable to some employers in the pension scheme, such as schools, who used their own payroll providers and who did not provide the relevant details in time. He felt that the development of an online portal would help address the matter. In respect of KPIs, Jason Bailey advised that these were derived from the KPI standards that had been set nationally, and other KPIs, such as contact with pension scheme members, could be added.

6.6       Lee Witham added that the KPIs were also relevant to the Section 101 agreement the Council has with Surrey County Council and were consistent with what the auditors considered important. He felt that most of the relevant KPIs were already included, however additional KPIs could be included in future.  In respect of compensation, Lee Witham stated that such matters could be discussed as part of the commercial review and contract negotiation with BT.

6.7       Sarah Hay added that there had been no requests for compensation from pension scheme members to date. She felt that Surrey County Council had made progress in improving their performance and that a number of issues had been traced back to BT.

6.8       Sarah Hay then referred to the paper on pension auto re-enrolment. She advised that not all those who should be auto re-enrolled into the pension scheme had been. Lee Witham added that the Council was challenging BT’s auto re-enrolment list and was working collaboratively with BT and Surrey County Council. Members noted the annual benefits statement report and that these statements were in the process of being sent out. Members also noted the paper on the internal audit update.

6.9       The Chairman sought clarification as to the reasons why BT were not auto re-enrolling everyone who should be. In reply, Jason Bailey advised that it was due to the lack of data for both new joiners to the scheme and also those leaving it. The other tri-borough partners also had also experienced problems in coping with having all the correct data. However, Jason Bailey was confident there would be significant improvement and Surrey County Council had appointed a new Team Leader to the pension administration scheme team.

6.10    The Chairman stated that the KPIs should be relevant to Westminster and so should be modified accordingly where appropriate. He requested that the KPIs performance be reported every quarter and include other KPIs identified as relevant, and any others considered irrelevant to be removed. The Chairman also requested that an appropriate representative from BT attend a future meeting of the Committee for the pension fund administration item. He also suggested that a BT representative be invited to the next Pensions Annual General Meeting.