The Royal Borough of Kingston upon Thames Pension Fund Panel was scheduled to discuss pension administration, governance, risk, and investment strategy at its meeting on 4 December 2025. The panel was expected to review the fund's performance, budget, and risk register, as well as consider a new conflict of interest policy. They were also scheduled to discuss the appointment of a new tracing and mortality screening supplier.

Investment Strategy Review

The panel was scheduled to discuss the outcome of the Investment Strategy Review following the 2025 Triennial Valuation for the Royal Borough of Kingston upon Thames Pension Fund, including the revised Investment Strategy Statement (ISS).

The Investment Performance Report noted that the market value of the Fund's assets at 30 September 2025 was £1,395m, an increase of £61m over the previous quarter. The Fund produced a positive return of 4.8% over the quarter, outperforming its benchmark, which returned 4.4%. Positive performance was also delivered over the one-year period at 9.3%, although this was below the benchmark at 10.0%. The three year return was 10.0%, which outperformed the benchmark at 9.9% and the five year return was 8.0%, which underperformed the benchmark at 9.2%.

According to the report:

The three year investment return of 10.0% per annum compares well with the actuary's expected return set at the last Triennial Valuation in March 2022, which was 4.2%.

The key drivers of the Fund's performance over the quarter to 30 September 2025 were noted as: an overweight position to equities, outperformance from some of the Fund's active managers, London CIV (LCIV)'s Multi-Asset Credit, Janus Henderson Absolute Return Bonds, and LCIV Diversified Growth.

The Fund's actual asset allocation as at 30 September 2025 was marginally outside of the strategic asset allocation (SAA) ranges in Infrastructure and Private Debt and more substantially outside the ranges in Global Equity, Property and Impact.

Governance and Risk Update

The Pension Fund Panel was asked to approve a draft Conflict of Interest Policy, delegate authority to the s.151 Officer¹ to appoint a new Tracing and Mortality Screening supplier, and note the update and risk register.

The Governance and Risk Update included a review of the risk register, which is formally reviewed every quarter. One red risk remained:

Risk 27 (Administration) - Failure by software provider (Civica) to provide software compliant with LGPS Regulations.

Officers had reviewed this risk and recommended its RED rating remain unchanged. Civica had delivered initial software patches to address the McCloud Remedy²; however, outstanding issues with the software remained, and further patches were still expected.

The consultation with all scheme employers had commenced, with employers issued with their individual valuation results alongside the draft Funding Strategy Statement (FSS).

A new consultation, called Scheme improvements (access and protections), from the Ministry of Housing, Communities & Local Government (MHCLG) outlines proposals on four key areas: Normal Minimum Pension Age (NMPA), New Fair Deal, Academies, and Access for Councillors and Mayors.

Following a review of the Fund's governance arrangements, a revised draft Conflict of Interest Policy was presented to the Panel for approval. The key changes from the previous policy were: clearer definitions, elevated responsibility, expanded gifts & hospitality section, a new 3-step operational procedure, a new declaration form, and an updated review cycle.

The Fund's incumbent supplier for tracing and mortality screening, Accurate Data Services Limited (ADS), was placed into voluntary liquidation on 7 October 2025. Officers acted immediately and carried out the following actions: a formal Termination of Contract Notice was served to the supplier with immediate effect, and a formal Data Destruction Instruction was also issued to the supplier and its liquidators.

Pension Administration Performance Update

The Panel was asked to note the Pension Administration Performance Update. The number of outstanding processes had continued to fall, from 718 at the last report to 688. The historic backlog (defined as cases overdue by more than 3 months) remained cleared at 0 cases.

The total number of overdue cases had increased this quarter, from 48 at the end of July to 274 at the end of October, as a direct result of the annual increase in Leaver cases following the end of the academic year.

No breach of law incidents have been reported since the last report, and there were no open IDRP cases currently being investigated by officers.

Pension Administration Projects Update

The Panel was asked to note the Pension Administration Projects Update. The Fund's Pensions Dashboard project was successfully completed, connecting to the dashboard by the 31 October 2025 deadline. The McCloud Remedy project is progressing against its revised plan, and communications to all 3,483 in-scope members have been issued.

The Dashboards Available Point (DAP), when the dashboard will be available to the public, has not yet been confirmed by the Pensions Dashboards Programme. Officers understand the current estimated timeline for this is Autumn 2026.

A revised project plan was established with a new target completion date of 30 June 2026, after the Fund missed the statutory implementation deadline for the McCloud Remedy project.

Officers can confirm that all required Pension Savings Statements (PSS) for the 2024/2025 tax year were successfully issued to the relevant members ahead of the statutory deadline of 6 October 2025.

Officers have written to overseas pensioners asking them to complete and return a life certificate. The deadline for members to complete and return certificates this year is 31 January 2026. Officers are also progressing an initiative to transition all overseas pensioners to digital payslips and P60s.

Budget Monitoring

The Panel was asked to note the Fund's final outturn position against budget for 2024-25 and a mid-year update on the 2025-26 budget, as detailed in the RBK Pension Fund - 2024-25 Outturn vs Budget and 2025-26 Budget Six Month Update.

The final net outturn position for 2024-25 was £2,147k against an approved budget of £869k, which represents a variance of £1,277k. The mid-year update of the 2025-26 budget shows the income and expenditure for the Fund is forecasted to produce a net outturn of £9,189k, as compared to the original approved net outturn of £8,759k.

The final net outturn for 2024-25 came in at £1,277k over the approved 2024-25 net budget, largely due to an increase in benefits payments following new pensioner members being set up across the year, along with an increase in lump sums and death grant payments made during the year.

The Fund is forecasting a net budget of £9,189k for 2025-26, compared to the original approved budget of £8,759k. The net increase of £281k is primarily due to a projected increase in fund manager fees, resulting from a rise in the market value of the Fund's investments over the first six months of the year.

Work Programme Update

The Panel was asked to note the proposed work programme for the year ahead, as detailed in the Review of Work Programme. The proposed indicative agenda items for the Pension Panel meetings that are due to take place over the next year are:

Pension Fund Panel March 2026

• Training: Financial Markets and Product Knowledge
• Pension Administration Update
• Pension Fund Business Plan 2026-29 and Budget 2026-27
• Governance and Risk Update
• Review of Work Programme
• 2025-26 Pension Fund Accounts Audit Findings
• Quarterly Investment Performance and LCIV Update
• Responsible Investment and Stewardship Update
• Investment Strategy Implementation
• Investment consultant monitoring report and LCIV report

Pension Fund Panel June 2026

• Training: an introduction to the work of the Pension Fund Panel and Pension Board, Pension Scams in the LGPS
• Pension Administration Update
• Governance and Risk Update
• Review of Work Programme
• Quarterly Investment Performance and LCIV Update
• Investment consultant monitoring report and LCIV report

Pension Fund Panel September 2026

• Training: An Introduction to Cyber Risk
• Pension Administration Update
• Annual Report & Accounts 2025-26
• Governance and Risk Update
• Review of Work Programme
• Quarterly Investment Performance and LCIV Update
• Investment consultant monitoring report and LCIV report

Pension Fund Panel December 2026

• Training: Investment Performance and Risk Management
• Pension Administration Update
• Governance and Risk Update
• Review of Work Programme
• Budget Monitoring - 2026-27 Six Month Update & 2025-26 Outurn vs Budget
• Quarterly Investment Performance and LCIV Update
• 2025-26 Pension Fund Accounts Audit Findings
• Investment consultant monitoring report and LCIV report