Issue - meetings

LOCAL GOVERNMENT PENSION SCHEME UPDATE

Meeting: 29/11/2021 - Pensions Committee (Item 35)

35 LOCAL GOVERNMENT PENSION SCHEME UPDATE pdf icon PDF 70 KB

Additional documents:

Minutes:

A report by the Director of Pensions informed Members that on 15 October 2021, the Scheme Advisory Board (SAB) published the result of its cost management process for the 2016 Scheme Valuation, following publication of amendments to the HM Treasury (HMT) Directions on 7 October 2021.

The report also covered HMT response to its consultation on the proposed reform of their cost control mechanism which overlaps and impacts on the SAB cost management process. 

Members heard from  the Head of Pensions Administration how the LGPS is subject to two cost management processes; one managed by Treasury and the other by SAB with an explanation provided in regard the mechanics of the process.

Committee Members were reminded that the  Cost Management Process of the reformed Career Average Revalued Earnings (CARE) Scheme and the impact of the proposed McCloud remedy on the cost of the scheme was considered  at its meeting of 22 June 2021, minute 8 refers

Members were then informed how the original result of the 2016 SAB cost management process was a reduction in cost of 0.9% of pay and a package of measures corresponding to 0.9% increase in employer costs were agreed. However, the process was subsequently paused due to the McCloud judgment, but was restarted following a Ministerial Statement by Luke Hall on 13 May 2021 outlining the details of the proposed remedy. This led to the publication of the Public Service Pensions (Valuation and Employer Cost Cap) (Amendment) Directions 2021 on 7 October 2021. The directions confirmed that costs resulting from McCloud will need to be treated as member costs within the cost management process.

On a motion by Councillor P Cleary and seconded by Councillor J Green it was:

Resolved – That the report be noted.