The meeting was scheduled to receive reports on the recent performance of the Gloucestershire Pension Fund, note the minutes of a previous meeting of the Pension Board, and to approve a number of policies that relate to the governance of the Fund.

Approval of the Gloucestershire Pension Fund Business Update

The Committee was scheduled to note a report on the state of the Gloucestershire Pension Fund at the end of September 2024.

The report details that as of 30 September 2024, the Fund had an estimated market value of £3,555.053 million, an increase of £81.636 million since the previous quarter.

The report states that:

Over the quarter, total Fund assets outperformed the strategic benchmark by 1%, with a return of 2.2%. Performance over the 3 years to 30 September 2024 was 4.3% annualised which is 0.6% behind the strategic benchmark.

The report describes the activities of a number of the Fund's investment managers, including Gresham House and Thriving Investments in relation to their affordable housing activities.

Approval of the Gloucestershire Pension Fund Risk Register

The Committee was scheduled to receive a report on the Fund's Risk Register. The report states that in accordance with the Fund’s Risk Management policy, progress and activity in managing risks will continue to be monitored and recorded on a risk register and key information will be provided to the Pension Committee. The report explains that the Risk Register was updated following the completion of the procurement of a new administration software package, to reflect the risk of losing access to that system.

The report states that three risks remain above target:

o Governance o Risk2 –remains above risk target. Recent knowledge assessment shows good progress but also highlights areas for further deployment of the training strategy/plan. o Operational (Administration & Communication) o Risk 2 – remains above risk target due to recent call for evidence now the latest consultation on the future of the LGPS which has been launched. o Risk 3 – remains above risk target. Progress on recruitment and KPIs is ongoing.

Approval of Pension Fund policies

The Committee was scheduled to be asked to approve updates to a number of policies.

Breaches of the Law

The Committee was scheduled to be asked to approve the Reporting and Recording Breaches of the Law Policy. This policy sets out the procedure for reporting breaches of the law to The Pensions Regulator. The policy had last been reviewed in December 2021, and a number of minor amendments have been proposed.

Risk Management

The Committee was scheduled to be asked to approve the Risk Management Policy. A review of the policy has been undertaken and the majority of the proposed changes relate to the introduction of the Pensions Regulators General Code. The policy also includes a new section that sets out a framework for escalating new or existing risks.

Business Continuity

The Committee was scheduled to be asked to approve the Business Continuity Policy. This policy is designed to:

reduce the effects of any incident or event that could disrupt activities of the Fund and ensure either the continuation of or smooth return to business as usual.

The report explains that the policy establishes the purpose, context, scope and governance of the Fund’s approach to business continuity and that the Fund's approach is consistent with the overall approach of Gloucestershire County Council.

Data Improvement

The Committee was scheduled to be asked to approve a Data Improvement Plan. This plan sets out the outcome of the Fund's assessment of its own data, and proposes a number of areas that require improvement. It explains that the plan was developed following the approval of the Data Improvement Strategy at the Committee's previous meeting on 19 September 2024.

It states that:

The plan outlines the outcome of the Fund’s self-assessment of its strategy ‘Measuring Success’ before detailing specific areas of focus that the Fund intends to undertake to improve the quality of its data over the next 12 months.

The plan notes that 94.2% of the Fund's 'common data', which includes members' names, addresses, National Insurance numbers and dates of birth, is accurate. This means that 5.8% of this data is inaccurate. The report notes that:

Nearly all failures are due to [out of date postal addresses].

The plan notes that 96.5% of the Fund's 'Scheme Specific Data', which is the data needed to calculate members' benefits, is accurate. The report notes that failures mainly relate to missing 'CARE pay' and 'contracting out' data. 'CARE pay' is the amount of pay earned by a member in a given year, and is used to calculate the value of their pension. 'Contracting out' refers to the process by which members of an occupational pension scheme were allowed to opt out of the State Earnings-Related Pension Scheme (SERPS) before it was abolished in 2016.

Administration Strategy

The Committee was scheduled to be asked to approve an updated Administration Strategy. The Administration Strategy outlines the administrative policies and performance standards the Fund and its sponsoring employers need to achieve to enable the provision of a cost-effective and high-quality pension administration service. It also seeks to promote good working relationships, improve efficiency and establish a culture of high-quality data exchanges and services between Scheme employers and the Fund. Furthermore, it provides details of how performance levels will be monitored and the actions that might be taken if they fall below the stated expectations.

The report explains that the strategy was first approved in June 2023 and will be further reviewed and updated to incorporate the use of Engage and i-Connect. Engage is a member self-service portal and i-Connect is an employer data portal. The report explains that the strategy has been formulated to meet the requirements of regulation 59 of the Local Government Pension Scheme Regulations.

The report highlights a number of initiatives that are being undertaken by the Fund to improve its approach to administration, including:

*Employer data portal (i-Connect): The Fund has recently procured an employer data portal which enables automatic monthly data transfers from all employers to the Fund. Once rolled out across all employers, this will allow the Fund to cross-check and validate core membership data at the point of submission, allowing the Fund to maintain up to date, high quality data.

The report also explains that:

*Member data portal (Engage): The Fund has also recently procured a member self-service portal called ‘Engage’. Engage will have a wide range of benefits for members: it will not only allow members to see their current pension benefits at any given point in time but it will also enable members to run retirement estimates, submit documents securely, replacing the need for paper communications in many instances, speeding up processing times.

The Pension Regulator General Code of Practice

The Committee was scheduled to receive a report on the Fund's compliance with the Pension Regulator's General Code of Practice. The report states that:

The new Code covers all governance (including investment governance) and administration conduct and practices required of an LGPS fund.

It explains that:

As reported to Committee at its meeting on 13 June 2024, the Fund carried out a high-level review of each module which was deemed to be relevant, utilising a model created by AON, who have supported the Fund previously in governance related activities such as the governance review.

The report concludes that the Fund has good overall compliance with the code.

Approval of Pension Board minutes

The Committee was scheduled to note the draft minutes of the meeting of the Pension Board, held on 23 October 2024.

The minutes note that the Board received a presentation from the Head of Pensions about the Gloucestershire Pension Fund’s performance in the recent LGPS Investment Performance benchmark undertaken by PIRC. The minutes state that:

Gloucestershire Fund was regarded to be in a positive position compared to some other funds and was the highest performing fund from the Brunel cohort.

Exclusion of the Press and Public

The Committee was scheduled to consider excluding members of the public from the remainder of the meeting to enable it to discuss confidential information about the Fund's activities, as allowed for under the Local Government Act 1972.

Approval of Exempt Minutes

The Committee was scheduled to be asked to approve the exempt minutes of its meeting on 19 September 2024.

Approval of Exempt Pension Board Minutes

The Committee was scheduled to note the draft exempt minutes of the meeting of the Pension Board, held on 23 October 2024.

Discussion of Cyber Security Strategy

The Committee was scheduled to be asked to approve a Cyber Security Strategy, having previously been consulted on with Gloucestershire County Council ICT&IMS teams.

Discussion of 2025 Valuation Assumptions

The Committee was scheduled to be asked to approve the assumptions to be used by the Fund's actuary, Hymans Robertson, for the 2025 valuation.

A valuation is a detailed assessment of a pension fund’s assets and liabilities, undertaken by an actuary at least every three years. The valuation process determines the contribution rate that employers will need to pay in order to meet the cost of paying their employee’s pensions.

The valuation process begins with the actuary setting a number of assumptions, such as how long members are likely to live after they retire, what investment returns are likely to be achieved over the longer term, and the rate of future pay increases. These assumptions will have a material impact on the final contribution rates determined.

The Committee is responsible for challenging and approving these assumptions before they are used.

Approval of Gloucestershire Pension Fund Update - Part 2

The Committee was scheduled to note a report on the Fund's activities.

Government Consultation: Local Government Pension Scheme: Fit for the future

The Committee was scheduled to be asked to approve a draft response to a consultation published by the UK Government on the future of the Local Government Pension Scheme.