The Surrey Local Pension Board is scheduled to meet on 23 May 2025 to review a number of reports and updates related to the Surrey Pension Fund. These include updates on the fund's performance, risk management, and compliance, as well as discussions on the impact of local government reorganisation and changes to the Local Government Pension Scheme. The board will also consider the internal audit strategy and plan for the upcoming year.

Impact of Devolution/Local Government Reorganisation

The board is expected to discuss the impact of devolution and local government reorganisation (LGR) on the Surrey Pension Fund. According to the report pack, Surrey County Council submitted its initial response to the Devolution/LGR Consultation on 21 March 2025, with the final response due by 9 May 2025. The outcome of SCC’s proposal will not be known until Autumn 2025.

Under the new arrangements, the Surrey Pension Fund may have to be established under a new Administering Authority. The proposal, subject to Cabinet approval, is the creation of a Single Purpose Pensions Authority, constituted as a Combined County Authority (CCA) under the Levelling Up and Regeneration Act 2023¹.

The report pack notes that the transfer of the Fund to a new Administering Authority will require a substantial amount of focus, resource and time. The Surrey Pension Team Risk Register has been updated to capture the risks associated with this, including:

• Legislative changes required to list the new Administering Authority in Schedule 1 of the LGPS Regulations.
• Transfer of functions, assets, and liabilities from SCC to the new Administering Authority.
• Novation of all third-party contracts of the Fund.
• Transfer of SPT staff to the new Administering Authority.
• Redrafting of all LGPS and wider legislative compliance policies and procedures.
• Revaluation of the pension fund assets and liabilities.
• Reconstitution of the pension committee and local pension board.

Impact of 'Fit for the Future' of LGPS

The board is also scheduled to discuss the impact of the government consultation on the future of the LGPS: Fit for the Future. The government intends to enact elements of their proposals via a Pension Schemes Bill with other elements to be dealt with using regulations and statutory guidance.

The proposals capture three main areas: LGPS investment pooling; local investment; and the governance of Funds and pools and the SPT Risk Register has been updated to reflect the currently identified risks associated with these proposals.

MySurrey (Unit 4) Issues

The board is expected to receive an update on the issues and risks associated with Unit 4/MySurrey². The report pack states that these issues have been and continue to be reported to both the Committee and the Board. The risks detailed in the risk register have not been amended at this time, however, an update on the current position can be found in Annexe 2 of the report.

According to the report pack, a MySurrey Stabilisation Program was formed to understand where the Unit 4 system was having large scale impact on operational areas of Surrey County Council and related services, such as pensions.

Investment Returns and Market Volatility

The board is scheduled to discuss the impact of market volatility on investment returns. The report pack notes that the impact of the United States of America (USA) implementing significant increases to tariffs for countries exporting goods to the USA, led to a record fall in the value of global equity markets and a subsequent drop in commodity and bond yields. As a result, Risk ID 5 has been reviewed and adjusted to reflect the heightened need for vigilance regarding potential impacts on investment returns.

Surrey Pension Team Overview

The board will receive an overview of the entire service at a macro level, with the Surrey Pension Team Dashboard being the primary vehicle for providing this overview. The dashboard covers the period January – March 2025.

The dashboard includes metrics related to fund performance, accounting and governance, service delivery, legacy reduction, strategy, and people.

Service Delivery Overview

The board is expected to receive updates on progress relating to a number of key administration projects and planned improvements. The report pack includes a quarterly performance summary, a quarterly performance trend analysis, a terminated case summary, and a complaints summary.

According to the report pack, the performance levels in this period have achieved an overall score of 95%, a decrease of 2% on the previous quarter. The team have exceeded the expected target for nearly all case categories in this period, achieving 100% in several areas such as ill health retirement, death notification, transfers out and refunds.

Change Management Update

The board is scheduled to receive an update on the Change Management Team activities for the period January – March 2025. This includes updates on communications, learning and development, project management, and transformation.

The report pack notes that the Surrey Pension Team Pulse survey results were analysed and presented to the PSLT (Pension Senior Leadership Team), the Extended Leadership team and all staff. A summary of this analysis is provided in Annexe 1. Further actions are now planned.

Internal Audit

The board will receive the Surrey Pension Fund Internal Audit Progress Report for Quarter 4 (01/01/2025 – 31/03/2025). The purpose of this report is to inform the Board of the work completed by Internal Audit in quarter four of 2024/25 and provide an update on any high priority actions due for implementation.

The board will also be presented with the Surrey Pension Fund Internal Audit Strategy and Plan for 2025/26. This plan forms part of the wider Orbis Internal Audit Annual Strategy and Plan for Surrey County Council for 2025/26.

Other Items

The agenda also includes the following items:

• Glossary, Actions Tracker, and Forward Programme of Work: For members to consider and comment on the Board’s actions tracker and programme of work.
• Surrey Pension Fund Committee Summary Update: This report provides the Local Pension Board with a summary of the Surrey Pension Fund Committee meeting held since the last meeting of the Board.
• Risk Overview: This report considers the changes made to the Risk Register for the Surrey Pension Team during Quarter 4 of 2024/25.
• LGPS - Background Report: This report considers recent developments in the Local Government Pension Scheme (LGPS).