The Royal Borough of Greenwich Pension Fund Investment & Administration Panel met on 15 September 2025 to discuss the Pension Board's annual report, the draft pension fund annual report and statement of accounts, the draft responsible investment policy, actuarial valuation assumptions, fund manager performance, and training on valuation assumptions. The panel approved the Draft Pension Fund Business Plan for 2025/26, with an amendment to bring forward the review of the statement of responsible investment policy to the September 2025 meeting. The panel also noted the expected impact of the Pension Schemes Bill on the Fund.

Pension Schemes Bill

The panel noted the expected impact of the Pension Schemes Bill on the Fund. The Hymans Robertson Business Partner provided an overview of the bill, which outlines significant changes in three key areas: asset pooling, local investment, and governance.

Under the new rules, the London CIV¹ will become a central partner, responsible for principal investment advice and implementation decisions, while the panel retains control over investment strategy. All fund assets are expected to be pooled by March next year, with existing investments transitioning gradually.

The Hymans Robertson Business Partner stressed the importance of articulating local views on responsible investment in advance to ensure they are reflected in the London CIV's common approach across boroughs. He also highlighted the need for strong oversight of the London CIV's performance, as future powers to challenge or exit underperforming funds will be limited.

Panel members raised concerns about the potential impact on the long-term sustainability of the fund if local authorities reduce their employer contributions due to the fund becoming more distant or less locally connected. They also discussed the risk of political pressure leading to poorly vetted local social infrastructure investments.

Councillor Olu Babatola, Chair of Pension Fund Investment & Administration Panel, suggested that a London-wide approach, similar to Greater Manchester's model, could help insulate funds from local pressures while still enabling strategic investment in areas of social need with strong financial viability.

The Hymans Robertson Business Partner reiterated the importance of the panel clearly defining its expectations around local investment and emphasised that all investment opportunities must undergo proper due diligence.

A panel member expressed concern about the pace of change and the potential over-reliance on outsourcing, particularly to large external firms, highlighting the risk of rising costs. The Accountancy and Business Change Manager confirmed that the London CIV will attend each meeting and provide regular updates on progress.

Draft Pension Fund Business Plan

The panel approved the Draft Pension Fund Business Plan for 2025/26 with the amendment of bringing forward the review of the statement of responsible investment policy to the September 2025 meeting.

The Accountancy and Business Change Manager presented the plan, which outlines a structured approach to fund management and reviews progress made during the previous year. He noted that the fund is expected to undergo significant change during the year, generating new workstreams, particularly in relation to the Pensions Bill.

Panel members raised concerns about the delay in reviewing the Responsible Investment Policy, proposing to bring it forward to the September meeting to allow time for meaningful consultation. They also expressed dissatisfaction about the delay in progressing the Communications Policy, which has been deferred to December.

The Pensions Operations Manager responded to concerns about the Communications Policy, stating that work is underway to develop modern, cost-effective communication methods, such as digital newsletters.

Audit Strategic Memorandum

The panel agreed the Pension Fund Audit Strategy Memorandum (ASM) for 2024/25 accounts.

Business partners from Forvis Mazars presented the report, explaining the audit approach for the pension fund accounts for the year ending 31 March 2025. They noted that the report had previously been presented to the Audit and Risk Management Panel in June.

The business partners explained that the overall materiality was revised from £16.9 million to £17.5 million, and performance materiality increased from £11.83 million to £14.03 million due to the absence of prior year audit adjustments. They highlighted the two significant audit risks: management override of controls and the valuation of Level 3 investments².

Panel members questioned the classification of Level 3 investment valuations as a fraud risk, and the Business Partners clarified that the term fraud risk reflects the potential for manipulation due to the subjective nature of these valuations, not an indication of actual fraud.

The Panel also raised concerns about the long gap between audit fieldwork and final sign-off. The Business Partners explained that the pension fund accounts cannot be signed off until the council's accounts are completed, as they form part of the same statement.