Report attached.

Contact: Vicky Jenks 01743 252192

The Board received the report of the Pensions Administration Manager which provided Members with the latest administration and regulatory updates affecting the Local Government Pension Scheme.

The Pensions Administration Manager introduced and amplified her report which updated Members on the work undertaken by the pensions administration team.

It was reported that 11 out of 14 key performance indicators were being met within the 95% target, with recent process changes and additional staffing supporting improvements in previously underperforming areas, particularly transfers in, transfers out and early leaver calculations. Significant operational pressures were highlighted, primarily driven by ongoing regulatory changes including McCloud remedy work, access and fairness requirements involving retrospective benefit adjustments, pensions dashboard implementation work in preparation for future member access, and broader “fit for the future” governance reforms requiring extensive policy review and additional unplanned workload. Governance-related changes also included recruitment of an independent person, amendments to the constitution, and preparation for an independent governance review to be undertaken by an external provider.

It was further noted that year-end reconciliation had been completed and annual benefit statements had been issued to all members within the statutory deadline. The McCloud project remained partially outstanding due to capacity constraints, software dependencies and outstanding government guidance, with completion now expected after the original deadline.It was confirmed that the cases that had not been completed would need to be reported to the Pensions Regulator although the issue was not considered a material risk for the fund in terms of member impact, as only a small proportion of members were expected to see benefit changes, and that similar reporting was expected across many funds nationally. Employer-related performance was also reviewed, with contribution collection reported as strong at 98% on time, although issues remained with iConnect data submissions, largely linked to changes in payroll providers affecting timely data flow.

Communication performance remained generally strong through the helpdesk function, although concerns were raised regarding the accuracy limitations of the existing pensions chatbot, which relied on rigid keyword matching and therefore produced inconsistent results depending on how queries were phrased. It was confirmed that while the bot handled a proportion of queries successfully and reduced administrative burden, it still required escalation for a significant number of cases and improvements were planned through migration to a more advanced system scheduled for introduction in the new year.

During discussion of the McCloud reporting position, it was observed that the risk explanation provided alongside the non-compliance position was clear and appropriately set out, particularly in terms of explaining impact and mitigation. A question was also raised regarding the effectiveness and value of the pensions chatbot given its accuracy limitations. In response, it was explained that the system still handled approximately 100 queries per month with around three quarters being answered correctly, with remaining queries being referred to staff or signposted to additional resources. It was confirmed that the system was still considered to have operational value but that ongoing improvements were limited under the current platform, and that a more sophisticated replacement would be introduced to improve query handling and accuracy.

RESOLVED:

To note the KPI chart and the information provided on KPIs that were not currently meeting the 95% target for completion within statutory timescales, including the actions being taken to address this. (Appendix A)

To note the progress and completion of key activities from the Fund business plan for Q1 2026-27. (Appendix B)

To note the progress of the Pension Dashboard implementation which was provided in the separate update report (Appendix C)

RESOLVED:

That the contents of the report be noted.