The Worcestershire Pension Committee met on 9 October 2025, and among other things, noted the Pension Fund Annual Report, and agreed to recommend that full council approve a change to the delegation of the LGPS Central Shareholder Representative. The committee also reviewed the Business Plan and Risk Register, and received updates on governance, compliance, and training.

LGPS Central Shareholder Representative Delegation

The committee agreed to recommend to the full council a change to the scheme of delegations, so that in the absence of Councillor Adrian Hardman, Chair of the Pensions Committee, the Section 151 Officer¹ would be the nominated LGPS Central Shareholder representative to exercise the council's voting rights. If the Section 151 Officer was unavailable, then Councillor Matt Jenkins, Green And Independent Alliance Group Leader and Vice-Chair of the Pensions Committee, would be the representative.

This change was prompted by a request from the Chief Executive Officer of LGPS Central, Richard Law-Deeks, to ensure that decisions could be reached in a timely manner to meet the government's deadline of 31 March 2026 for delivering required changes following the response to the LGPS Fit for the Future consultation. These changes include expectations around scale, cost efficiency, and the delivery of additional services such as investment advice and local investment strategies.

The report noted that a number of the decisions of LGPS Central are reserved matters and require 100% approval to pass, including budgets and the admission of new partners.

Pension Fund Annual Report

The committee considered the Pension Fund Annual Report and Annual Report Summary for the year ended 31 March 2025. Councillor Hardman noted that there had been limited changes from last year's report. Phil Rook, Chief Financial Officer, added that the External Audit - Interim Audit Findings Report for Worcestershire Pension Fund had been well-received by the Audit and Governance Committee on 25 September.

The annual report noted key achievements during the 2024/2025 financial year, including:

• An increase in the fund's net assets of £44.9 million, bringing the total to £4,016.2 million.
• Growth in scheme membership, with active employer numbers increasing from 69,595 to 70,810.
• The fund's actuarial statement supported an improvement in the funding position to approximately 127%, up from 101% in the 2022 valuation.
• The fund retained its signatory status to the UK Stewardship Code 2020².
• Progress was made in improving access to information for members through the development of the fund's Members' Portal.

The report also acknowledged regulatory changes to the LGPS landscape led by His Majesty's Treasury and the Ministry for Housing, Communities & Local Government³.

Business Plan

The committee reviewed the Worcestershire Pension Fund Business Plan as of August 2025 and agreed to implement phase 2 of the address tracing exercise, which forms part of the data readiness work associated with the Pensions Dashboard Programme (PDP).

Richard Sultana, Head of Pensions Administration, reported that the latest pensions administration key performance indicators (KPIs) were in line with average turnaround targets. He noted that there had been a handful of cases where remedial action was required by the end of November in relation to the McCloud remedy[^5], but that the amounts involved were small. He confirmed that the overall impact of the McCloud remedy in terms of monetary value was immaterial in terms of its impact on the Pension Fund.

Mr Sultana also indicated that the major employers in the fund had been offered a 1% reduction in contribution rates, with an option for a 2% reduction in the first year, and that a positive response had been received from the majority of employers. He said that scheme employer representatives would have an opportunity to discuss the contribution rate modelling results with the actuary at an Employer Forum meeting at the end of October, and that the actuary's Strategy Statement and funding results would be reported to the next committee meeting.

In response to a query about the possibility of offering a pre-payment option to employers over the next three years, Mr Sultana advised that pre-payment was an option available to employers but had not been taken up, and that it was a matter for employers to discuss with the actuary.

Phil Rook, Chief Financial Officer, commented that employer contribution rates would need to be reviewed because at present, contribution rates varied between the County Council and district councils dependent on size.

The Business Plan noted that the team had successfully implemented phase 1 of the ISP implementation, working alongside Heywoods between November 2024 and January 2025, and that phase 2 of the ISP had been implemented in May 2025. The committee agreed to implement phase 2 of the address tracing exercise, at a cost of £23 per record, with a maximum cost of £17,687 if all records are traced.

Risk Register

The committee noted the May 2025 Worcestershire Pension Fund Risk Register.

Phil Rook explained that there was some doubt as to whether the government's Fit for Future legislation would be enacted to meet the 31 March 2026 deadline, and that if that was the case then certain elements of the proposed reforms would not be achievable. He added that it was difficult to assess the risk impact of any delay at this stage. Sherief Loutfy added that a Pool risk register was being created which would include political risk of any delay in the introduction of the legislation, and that LGPS Central did not recognise the delay to the introduction of the legislation as a risk but that it was important to recognise that this register was being designed as a Pool risk register not a company risk register.

Richard Sultana indicated that the scoring mechanism for assessing the RAG rating of risks was being reviewed to establish a more fluid approach, and that the present system was too rigid which lead to certain risks receiving an inappropriate RAG rating.

Governance and Compliance Update

The committee noted the Worcestershire Pension Fund Governance and Compliance Update, and the Good Governance Position Statement. They also noted the Dashboard Data Match Criteria Policy, Under and Overpayment Policy and the draft Data Improvement Policy.

In response to a concern about the amount set out for overpayment/debt write-off being too low, Richard Sultana undertook to monitor and report back to Committee in six months on the number of occasions where overpayment/debt write-off exceeded £100 up to the value of £250 gross on the death of a pensioner and any other overpayment type.

Training Update

The committee noted the Training Update, including the Training Policy and Programme and the Training and Conferences Calendar.

Richard Sultana introduced the report and noted that since the committee report was written, the number of registrations to the member portal had increased, with the percentages now standing at Active Members: 49%, Deferred Members 30% and Pensioner Members 32%.

Mr Sultana also noted that the contract for the LGPSC Online Learning Academy (LOLA) was coming to an end, and that a review would be undertaken as to determine whether to renew the contract or look at other ways of arranging training for Board and Committee members.

Forward Plan

The committee noted the Work Programme.

Sherief Loutfy confirmed that the LGPSC budget and business plan had now been approved ahead of schedule, but that he would prefer to keep the scheduled January 2026 committee meeting in the diary to discuss other matters.

In response to a query, Mr Loutfy indicated that an internal governance assessment would be needed of the impact of Pension reform and Local Government Reorganisation. Phil Rook added that LGR could have a significant impact because if the decision was taken to adopt a two county model then it would not be possible to split the Fund accordingly.

Philip Hebson, Independent Financial Advisor commented that there would still be a role for this committee and the Pension Investment Sub-Committee in terms of maintaining an oversight of the Fund's legacy investments because it was unlikely that LGPSC would have sufficient capacity to do so. In addition, the Fund might need to review its light touch approach to overseeing the work of LGPSC to reflect the changes in responsibilities under the new arrangements.