The Pension Board of Kingston upon Thames Council met on Thursday 18 December 2025 to review the performance of pension administration, discuss ongoing projects, and examine the fund's governance and financial position. Key decisions included noting updates on pension administration performance and projects, approving the revised Conflict of Interest Policy, and noting the budget monitoring report.

Pension Administration Performance Update

The Board received an update on the Shared Pensions Administration Service, noting a continued decrease in outstanding processes, with the historic backlog of cases overdue by more than three months remaining at zero. However, cases overdue by less than three months had increased from 48 to 274. This rise was attributed to a seasonal spike in leaver notifications following the end of the academic year. Members inquired about the high proportion of transfers out cases and the potential for automation in manual case handling. Officers explained that there was significant movement within the Local Government Pension Scheme (LGPS) across London, the specific reasons for which were unclear. They confirmed that most cases were handled individually but that the team was investigating software for bulk processing, such as for refunds, as part of their procurement plans for the next 12 months. The Board noted this update.

Pension Administration Projects Update

An update was provided on key projects within the Shared Pensions Administration Service. The Pensions Dashboard project was successfully completed, connecting to the dashboard by the 31 October 2025 deadline and finishing £10,517 under budget. The McCloud Remedy project is progressing according to its revised plan, with communications issued to all 3,483 in-scope members, and the project remains on track for its 30 June 2026 completion date. The service is also transitioning overseas pensioners to digital payslips and P60s to enhance accessibility and security. Members questioned the green status of the Insights module, which was implemented a month after its August deadline. Officers clarified that this module was an internal reporting tool and not a statutory requirement, therefore having no impact on legal compliance or overall project delivery. The Board also asked if the June 2026 McCloud deadline was dependent on the software provider, Civica. Officers confirmed there were dependencies on Civica patches and data from other funds, but the June date included contingency and was considered a realistic target. The Board noted this update.

Governance and Risk Update

The Board reviewed the Pension Fund's governance activities and risk register. A key development was the formal review and approval of the Conflict of Interest Policy by the Pension Fund Panel on 4 December 2025. The new policy introduces clearer definitions and an operational procedure for all members, officers, and suppliers. Officers reported that the risk register remained largely unchanged, with the software provider, Civica, continuing to be a Red risk. The Fund is currently consulting on the funding strategy for the April 2026 triennial valuation. A new tracing and mortality provider is expected to be in place by Christmas, following the liquidation of the previous provider. Members requested that the review dates for the Conflict of Interest policy be clearly stated, and officers agreed to review this. The Board noted the update and the risk register.

Review of the Work Programme

The proposed work programme for the Pension Board meetings until the end of 2026 was presented. The March meeting will include the final valuation results, audit findings, and the 2026–27 budget. Training for the Board and committee members is scheduled for Summer 2026, following the May elections. The Board noted the updated Work Programme.

Budget Monitoring - 2024-25 Outturn vs Budget & 2025-26 Six Month Update

A report was presented on the final outturn position against the budget for 2024-25 and a mid-year update for the 2025-26 budget. The overspend of £1.277 million for 2024-25 was primarily attributed to an increase in members choosing to take lump sum payments upon retirement. An overspend of £280k was forecast for 2025-26, largely due to higher asset growth leading to increased fund manager fees. A Board member commented that many costs, such as fees tied to asset value, were not truly controllable and that the focus should remain on core administrative costs. The Board noted the report.

Pension Fund Panel Update - Investment Strategy and Performance

The Board received a summary of the investment-related papers presented to the Pension Fund Panel in December 2025. Officers reported a strong quarter with a 4.8% return, representing a £61 million increase in the Fund's assets. The Fund's average returns over three years were 10%, significantly above the actuary's expected return of 4.8% set at the last Triennial Valuation. It was noted that new government regulations, Fit for the Future, would require 100% of assets to be managed through the London CIV pool by 31 March 2026. The Board noted the report.

Exclusion of Press and Public

The Board resolved to exclude the press and public from the meeting for the next agenda item, which was considered exempt. This was done under Section 100(A)(4) of the Local Government Act 1972, as the disclosure of exempt information was likely, and the public interest in maintaining the exemption outweighed the public interest in disclosing the information.

Investment Strategy Review

The Pension Board reviewed an exempt report detailing the outcome of the Investment Strategy Review following the 2025 Triennial Valuation for the Kingston Pension Fund, which included the revised Investment Strategy Statement. The Board noted the decisions made by the Pension Panel at its meeting on 4 December 2025.