The Pension Committee of Sutton Council was scheduled to consider updates on pension administration performance and projects, review the Annual Report and Accounts for 2025-2026, and discuss governance and risk. The committee was also scheduled to receive an update on pension reforms, review its work programme, and consider quarterly investment performance.

Pension Administration Performance Update

The Pension Administration Performance Update was scheduled to provide an overview of the key administration performance metrics for the Shared Pensions Administration Service. The report was expected to detail a rise in outstanding processes, attributing this to factors such as the annual year-end return exercise, the suspension of SCAPE rate transfer calculations, and the processing of responses for digital payslips. The report was scheduled to highlight that while Priority One cases, such as deaths and retirements, continued to be processed within service level agreements, overall overdue cases had exceeded targets. A recovery plan was scheduled to be presented to bring performance back within expected levels. The report was also scheduled to note one breach of law relating to the McCloud Remedy, which had been reported to The Pensions Regulator, and two active Internal Dispute Resolution Procedure (IDRP) cases.

Pension Administration Projects Update

The Pension Administration Projects Update was scheduled to provide information on key administration projects. This included an update on the Annual Benefit Statements (ABS) for 2026, noting that while statements for active and deferred members were published, those for members in scope of the McCloud Remedy would be re-issued once underpin calculations are complete due to industry-wide software delays. The report was scheduled to detail the McCloud Remedy update, confirming that data collection, validation, and loading phases were complete, but that the statutory deadline for issuing McCloud-compliant statements had been missed, leading to a reported breach to The Pensions Regulator. Updates on the LGPS Regulations 2026 – Access & Fairness project were also scheduled, outlining progress on identifying members in scope, system implementation, and beneficiary tracing. The report was also scheduled to provide an update on the Pension Dashboard Programme and Pension Savings Statements (PSS).

Annual Report and Accounts 2025-2026

The Pension Committee was scheduled to consider the Pension Fund Annual Report 2025/26 and the accompanying Statement of Accounts. The report was scheduled to highlight that the net assets of the Fund exceeded £1 billion for the first time, reaching £1,081 million. It was also scheduled to note that the Fund returned 9.1% over the year, slightly behind the LGPS average, but in the top quartile of funds over three and ten years. The report was scheduled to detail that the Fund remained cashflow positive, with contributions exceeding benefits paid. Membership numbers had increased, and progress had been made on implementing national legislative changes, including the McCloud Remedy and Pensions Dashboard preparations. The report was scheduled to recommend the approval of the draft Annual Report and Accounts, pending the conclusion of the external audit.

Governance and Risk Update

The Governance and Risk Update was scheduled to provide an overview of key governance activities and a review of the Fund's risk register. The report was scheduled to indicate that Administration risks were rated amber overall, while Funding & Investments and Governance risks were rated green. A red-rated risk concerning the software provider failing to deliver compliant software for the McCloud Remedy was scheduled to be highlighted, noting that this had resulted in a regulatory breach. Amber risks were scheduled to be summarised, including potential financial liabilities from retrospective legislative changes, the need for committee and board members to possess necessary skills and knowledge, the risk of cyber-attacks, the financial impact of climate change, adverse market movements, and the implementation of Fit for the Future pension reforms. The report was also scheduled to provide an update on the procurement of new pensions administration software and details of additional administrative charges levied against employers.

Pension Reforms Update

The Pension Reforms Update was scheduled to provide information on the implications of the 2026 LGPS regulations and guidance, focusing on asset pooling, the Investment Strategy Statement (ISS), and fund governance. The report was scheduled to confirm that high-level strategic decision-making remains with partner funds, while implementation responsibility transfers to investment pools. It was scheduled to note that the Fund had invested a significant portion of its assets through the London CIV (LCIV) pool. Minor amendments to the Investment Strategy Statement were scheduled for agreement, including the addition of a 20-year expected return and clarification on local investment targets. The report was scheduled to detail key governance changes, including the requirement for a Senior LGPS Officer role, the appointment of an Independent Person, and stringent knowledge and training requirements for committee members and officers. The commissioning of the first periodic Independent Governance Review by March 2028 was also scheduled to be discussed.

Work Programme Update

The Work Programme Update was scheduled to present a draft programme of agenda items for Pension Committee meetings over the next year. The proposed items included training sessions on pensions governance and cyber risk, updates on pension administration performance and projects, governance and risk reviews, and quarterly investment performance reports. The committee was also scheduled to consider the Annual Report and Accounts, budget monitoring, and updates on pension reforms.

Quarterly Investment Performance

The Quarterly Investment Performance report was scheduled to review the Fund's investment performance for the quarter ending 30 June 2026. The report was expected to show an increase in the Fund's total market value to £1.14 billion. It was scheduled to detail that while absolute returns were positive, the Fund had underperformed its benchmark over the quarter and longer-term periods, largely due to the performance of active equity managers. Actions to address this underperformance, including transitioning holdings into the new LCIV Core Global Equity Fund, were scheduled to be discussed. The report was also scheduled to provide an update on the Fund's asset allocation compared to its strategic targets, noting overweight positions in Listed Equity and underweight positions in Private Equity, Property, Infrastructure, and Private Credit. An update on the London Collective Investment Vehicle (LCIV) was also scheduled, including its pooling position and the implications of the Fit for the Future regulations. The report was scheduled to highlight the Fund's shortlisting for the LAPF Investments Awards Fund of the Year category.