The Berkshire Pension Board meeting on Monday 17 June 2024 covered several key topics, including board governance, scheme and regulatory updates, risk management, statutory policies, good governance, administration, and responsible investment. Decisions were made on the extension of the deadline for member representative applications and the adjustment of key performance indicators for deceased processing.

Scheme and Regulatory Update

Philip Boyton, Deputy Head of Pension Fund, discussed a recent report on Sharia Law and its implications for the Local Government Pension Scheme (LGPS). The report concluded that while the LGPS is not Sharia-compliant at a fund level, Muslim members could still receive pension benefits without breaching Sharia compliance. Recommendations included developing a Sharia-compliant fund and establishing a Sharia Board for oversight. The Chair raised concerns about the alignment of the scheme with Muslim members' values, and further guidance from the Scheme Advisory Board was anticipated.

Philip Boyton also provided an update on the Pensions Regulator’s new General Code, which came into effect on 27 March 2024. The Code replaces ten previous codes and includes modules on cyber security and pension scams. An internal assessment is underway to evaluate the Fund's compliance with the new elements, and compliance checker systems are being considered for procurement.

Risk Management

Ian Coleman, Interim Head of Pension Fund, presented the risk management report, noting that the risk register currently has 46 risks, with the McCloud Remedy implementation assessed as red due to uncertainties about the volume of work required. A dedicated project plan and risk register for the McCloud Remedy are in place, and progress is being made in collaboration with the actuary and pension software provider.

Statutory Policies

Ian Coleman introduced the updated Governance Compliance Statement, noting minimal changes. Nikki Craig, Assistant Director of HR Corporate Projects and IT, suggested including cyber security training, which could be facilitated by a compliance checker. The Pensions Regulator's public sector online toolkit is expected to be updated next year.

Good Governance

The annual business plan, budget for 2024/25, and medium-term plan were discussed. The Chair suggested including specific percentages of standards achieved in the report. Variances in the budget were attributed to uncertainties and decisions made by employers. Staff costs were under budget due to vacancies, while administration costs were over budget due to software development expenses related to the McCloud Remedy and Pension Dashboards Programme.

Administration Report

Philip Boyton presented the administration report, recommending an increase in the key performance indicator for deceased processing from five to ten working days, effective from 1 January 2024. This adjustment reflects discussions held by the Board and Committee. Issues with i-Connect submissions by Reading Borough Council and a payroll provider for academies and schools were noted, with ongoing efforts to streamline the year-end process.

Responsible Investment

Ian Coleman discussed the responsible investment report produced by LPPI, highlighting progress in climate voting and the performance of the LPPI Global Fund. The Chair noted the importance of communicating responsible investment work to members and the positive trend in Net Zero targets.

For more details, you can refer to the Public reports pack and the Minutes of Previous Meeting.