The Pension Fund Committee is scheduled to meet to discuss the fund's annual accounts, risk management strategies, investment performance, and compliance with pension regulations. They will also discuss training and knowledge requirements for committee members, and updates to the Local Government Pension Scheme.

Compliance with the Pensions Regulator's Code of Practice

The committee will receive a report on the Barnet Pension Fund's compliance with The Pensions Regulator's (TPR) General Code of Practice¹. An assessment was undertaken by Aon² to determine the fund's compliance, and the report in Appendix A evaluates key areas such as governance, administration, investment and reporting.

Key findings include:

• Governance: Only one out of 30 governance-related modules achieved full compliance, with gaps identified in training, chair appointments, conflict of interest policies, and risk management.
• Funding and Investment: None of the four modules were fully compliant, with key gaps in climate risk assessment, stewardship, and monitoring processes.
• Administration: Three out of four modules in information handling were fully compliant, but improvements are needed in administration training, cyber policies and financial transaction reviews.
• Communications and Disclosure: Compliance is stronger, but collaboration with service providers on scam detection and reporting needs development.
• Reporting to TPR: Regular reporting modules show strong compliance, but whistleblowing policies and training require improvement.

Recommendations include developing a comprehensive training and induction plan, formalising a fund-specific Conflicts of Interest policy, creating a fund-specific Risk Management Policy, implementing a fund-specific Cybersecurity Policy and Incident Response Plan, and updating policies on conflicts of interest and breaches reporting.

An action plan to implement the recommendations is included in Appendix B.

Risk Management Review

The committee will review the pension fund's risk registers, which detail the risks associated with the management of the scheme. The registers are reviewed and updated quarterly by the LBB Pensions Team and the London CIV³.

One new risk, ADM21, has been added to the administration risk register, relating to the recent prepayment/repayment issue. The report pack notes that:

Whilst this issue has already occurred, they are some mitigating actions to be completed to ensure that this does not occur again.

One of these actions is that the committee may wish to consider whether it should approve any advance payments from the scheme employer.

Another new risk, GEN05, has been added to the non-administration risk register, relating to the government’s LGPS Fit for Future consultation.

For risk ACC01, officers in the LBB Pensions Team are writing formally to West Yorkshire Pension Fund (WYPF) to request that they engage with officers to resolve the reconciliation of contributions issue.

Annual Accounts and External Audit Update

The committee will discuss the Pension Fund's 2023/24 audit findings report from Grant Thornton. The report sets out their key findings and other matters arising from the audit.

A summary of their findings is:

• The pre-payment and repayment contribution issue is still unresolved.
• Grant Thornton have had challenges during the audit in obtaining certain information and also because the Fund had not undergone an audit in the previous three years.
• Grant Thornton anticipates issuing a disclaimed audit opinion due to some outstanding issues where they have not had time to complete the testing before the 28 February 2025 backstop date for financial statements.
• Grant Thornton have been unable to perform a review of the 2022 triennial valuation

The report also includes management responses to Grant Thornton’s action plan recommendations.

Knowledge and Understanding

The committee will discuss training options available to members of the Local Pensions Board and Pension Fund Committee. The LBB Pensions Team have identified mandatory training, which they expect Local Pension Board members to undertake, and recommended training, which will further develop both the committee and board members’ skills.

The committee will also discuss a draft training strategy for the committee and the Local Pensions Board, which links into one of the recommendations of the TPR’s new code of practice.

Investment Strategy

The committee will receive an update on investment strategy decisions previously approved, and discuss upcoming proposals for the fund's strategic asset allocation to align with pooling objectives.

The report pack notes that the committee will be asked to approve the following:

• Commit £80m to the LCIV Private Debt II Fund to maintain the long-term target private credit allocation.
• Transition the entire Barings High Yield Fund holdings to LCIV Multi Asset Credit Fund in line with the asset pooling objectives.

The London CIV has developed an Indirect Real Estate Pooling (IREP) solution that enables Partner Funds to meet their pooling requirements with minimal disruption. The London CIV has appointed CBRE Investment Management, as a strategic partner to support the implementation of this solution.

Administration Performance

The committee will receive an update on the current administration performance by West Yorkshire Pension Fund (WYPF), along with updates on other administration and legislative matters.

As of 13 March, 99.6% of Annual Benefit Statements (ABS’s) had been produced. The reason for the remaining members not receiving a statement is either due to WYPF waiting information from employers, or where WYPF are waiting for a transfer in of benefits from another pension arrangement to be finalised.

WYPF are working on a number of previously identified areas of data with the largest number of issues that need correcting, and are also running a bulk address tracing exercise across all the funds that the administer soon, so missing addresses and postcodes can be updated.

Admissions, Cessations and Bond Status

The committee will receive a status update on the outstanding admissions, cessations and bond agreements.

There have been no new admissions advised since the last update to the committee in October 2024. In addition, three schools have recently converted to academy status.

One exiting employer (Alliance in Partnership at Osidge School) have recently paid the cessation deficit if full.

Update on the Local Government Pension Scheme

The committee will receive an update on the government’s Fit for the Future consultation for Local Government Pension Schemes.

The proposals primarily focused on three key areas: asset pooling, local investment and governance of funds and pools.

The government’s goal is “to ensure that the LGPS is sustainable, efficient, and better aligned with long-term economic and investment priorities”.