The Local Pension Board of Leicestershire Council met on Wednesday, 4 February 2026, to discuss a range of important reports concerning the administration, performance, and future planning of the Pension Fund. Key topics included the administration report for the third quarter of 2025, the business plan and budget for 2026/27, and updates on the draft funding and investment strategies.

Pension Fund Administration Report (October to December 2025 - Quarter Three)

The Board was scheduled to receive an update on the main administrative actions undertaken by the Pensions Section during the third quarter of 2025. This report covers governance areas, including the administration of Fund benefits and the performance of the Pensions Section against its agreed performance indicators. The report details workloads across various areas, with a RAG rating indicating performance against targets. Areas flagged as below target (red) included Preserved Benefits and Aggregations, which were noted as being impacted by the McCloud remedy complexity and resource allocation to other issues. The report also covered complaints, breaches log (including an ongoing failure by South Leicester College to pay pension contributions), and internal audit reports on Contribution Collection and Pension Creations. Updates on the new pension websites, launched in January 2026, were also scheduled, noting a significant increase in calls to the Help Desk following the launch. Progress on the McCloud remedy implementation, particularly the adjustment of pensions for eligible pensioners, was also to be discussed, with 216 cases outstanding.

Pension Fund Key Performance Indicators

This report was scheduled to present proposed improvements to the presentation of workloads and key performance indicator (KPI) data within the quarterly administration report, aiming to align this with the requirements of the Fund's annual report. The proposed approach included increasing the number of workload areas from 10 to 14 to align with annual report requirements, and displaying quarterly information in a single table showing cases completed and remaining. KPIs for the quarter were to be included in an appendix, expanded to align with annual report requirements.

Pension Fund Business Plan and Budget 2026/27

The Board was to be informed of the Pension Fund's Business Plan and Budget for the 2026/27 financial year. The Administration Business Plan detailed key changes impacting the Fund, including the continued implementation of the Pensions Dashboards programme, phase two of the McCloud remedy, a review of the administration system contract, and the implementation of changes arising from Local Government Reorganisation. The Investments Business Plan covered policies, asset allocation, Fund valuation, and reporting. A new Governance Business Plan was also presented, incorporating recommendations from the 'Fit for the Future' proposals. The Pension Fund budget, which is managed separately from the Council's budget, included projected estimates for 2025/26 to 2027/28, with a significant portion allocated to investment management expenses. Staffing budgets for Pensions Administration were also detailed, including proposed increases for pension apprentices and an Assistant Team Manager.

Draft Funding Strategy Statement

This report was intended to inform the Board of the results of the Fund's Funding Strategy Statement (FSS) consultation. The FSS underpins the Fund's policies and includes a framework for setting contribution rates for each employer group. Key proposed changes included the introduction of a corridor approach for cessations, designed to protect the Fund and remaining employers when an employer exits the scheme, with proposed lower and upper levels of 85% and 95% likelihood respectively. The report also detailed consultation replies from employers and the Department for Education, highlighting themes such as the treatment of exit credits, a proposed 3% cap on the secondary rate, and the minimum likelihood of success for employer groups.

Draft Investment Strategy Statement

The Board was to consider key changes expected for the Fund's Investment Strategy Statement (ISS). The draft ISS acknowledged the Fund's 'Fit for the Future' position and the evolving role of LGPS Central. It expanded on investment beliefs to include preferences, introduced a target and framework for local investment in partnership with LGPS Central, and streamlined the responsible investment section. The report noted that further refinements might be necessary following the Pension Bill's enactment and other regulatory developments.

Climate Related Disclosure Progress Update

This report provided an update on the latest Climate Related Financial Disclosure Report for the Leicestershire County Council Pension Fund and activities undertaken since the approval of the Net Zero Climate Strategy (NZCS). High-level progress against the nine targets agreed in March 2023 was to be presented, indicating that the Fund had exceeded initial expectations for its net zero journey. Specific achievements included reducing the weighted average carbon intensity (WACI) by 55.6% and absolute carbon emissions by 42.2% from a 2019 baseline. The report also detailed the allocation of over £1.5 billion to climate-related investments and the alignment of 75.8% of equity financed emissions with the Paris Agreement or under an engagement programme. Performance data for various equity funds was also to be presented.

Pension Fund Training Needs Self Assessment

The Board was to be provided with an update on Training Needs Self Assessments undertaken by Committee and Board members. The report outlined progress against the Fund's Training Policy and the 2025 Training Plan, referencing CIPFA's eight core areas of knowledge and skills. Anonymised results from a self-assessment questionnaire were attached, and members who had not yet completed it were urged to do so. The report also detailed completion progress against the 2025 Training Plan, which involved Hymans' online Aspire training modules.

Pension Fund Policy Report

This annual report was scheduled to present a summary of current policies and strategies, including any new policies introduced or amendments made. Policies listed for review included the Investment Strategy Statement, Net Zero Climate Strategy, Funding Strategy Statement, Administration Strategy, Fund Training Strategy, Conflict of Interest Policy, and Fund Employer Risk Policy. Updates on the Investment Adviser Objectives and Cash Management Strategy were also to be discussed.

Record Keeping - Data Improvement

The report aimed to inform the Board of plans for maintaining and improving the quality of pensions data held during 2026-2027. It highlighted that the overall quality of pensions data remained high, with data quality scores over 97%. Plans for 2026-27 included addressing the Pension Dashboard Programme (PDP) by cleansing data and reducing outstanding cases, conducting an address cleanse of deferred members, and continuing administrative tasks linked to the McCloud remedy. A review of casework workflow processes on the Altair administration system was also scheduled to ensure compatibility with evolving reporting requirements.

Risk Management and Internal Controls and Fit for the Future Update

This report was to inform the Board of any changes relating to the risk management and internal controls of the Pension Fund, as stipulated in the Pension Regulator's Code of Practice. The report included an update on the Fund's risk register, detailing 19 risks across six areas: Investment, Liability, Employer, Governance, Operational, and Regulatory. Changes to risk scores and contents of the register were to be highlighted, along with the implications of the 'Fit for the Future' proposals on investment risk. The report also detailed draft government regulations and guidance concerning pooling, investment management, and governance requirements, including the appointment of a Senior LGPS Officer and independent persons to the Pension Committee.