The Pensions Committee of Merton Council was scheduled to discuss the 2024-25 Audit Results Report and the Triennial Valuation & Funding Strategy Statement. Other topics included a quarterly performance review, an investment performance update, and an investment strategy review.

2024-25 Audit Results Report

The committee was scheduled to consider the 2024-25 Audit Results Report, which summarises the status of the audit for the financial statements. The report, prepared by Ernst & Young LLP, details findings related to areas of audit emphasis, accounting policies, judgements, and internal control findings. The audit was designed to express an opinion on the financial statements and address current statutory and regulatory requirements. The report indicated that the audit work in respect of the opinion was substantially complete, with outstanding items including subsequent events procedures and the receipt of signed accounts, the Annual Report, and a management representation letter. No uncorrected misstatements affecting the net asset statement and fund account were identified, although some disclosure misstatements were corrected by management. The report also highlighted that no significant deficiencies in internal control were identified.

Triennial Valuation & Funding Strategy Statement

A significant portion of the meeting was scheduled to be dedicated to the Triennial Valuation and Funding Strategy Statement (FSS). This statement, prepared in accordance with Regulation 58 of the LGPS Regulations 2013, outlines the strategy for meeting the pension liabilities of the London Borough of Merton Pension Fund. The aims of the FSS include enabling the Fund Actuary to undertake appropriate funding calculations, establishing a clear and transparent strategy for meeting employer liabilities, supporting stable primary contribution rates, and ensuring the solvency and long-term cost efficiency of the Fund. The statement detailed key funding principles, including the funding target of having at least 100% of assets to meet accrued past service liabilities. It also outlined how employer contributions are calculated, differentiating between primary and secondary rates, and discussed the approach to managing surpluses and deficits. The FSS also detailed the main actuarial assumptions used for valuation, including those for inflation, pay increases, investment returns, and demographic factors. The document also covered employer events such as joining and exiting the fund, and policies for managing risks, including investment, demographic, climate, and regulatory risks.

Investment Performance Update (December 2025)

The committee was also scheduled to receive an update on investment performance as of December 2025. This would likely have provided details on the performance of the Merton Pension Fund's investments over a specific period, allowing the committee to assess how the fund's assets were performing against its objectives and benchmarks.

Investment Strategy Review

A review of the Investment Strategy Statement was also on the agenda. This would have involved examining the current investment strategy, which guides how the pension fund's assets are invested to meet its long-term liabilities. The review would likely have considered whether the existing strategy remains appropriate in light of market conditions, the fund's funding position, and any changes in regulatory requirements or investment best practices.

Other Scheduled Discussions

The agenda also included a Quarterly Performance Review, which would have provided a verbal update on the fund's performance. Additionally, there was an item on Pension Administration Performance, likely covering the efficiency and effectiveness of the processes involved in managing the pension fund's administration. An update on Pooling was also scheduled, which would have provided information on the progress and implications of pooling arrangements for the Merton Pension Fund's investments. Finally, an initial update on the Merton Pension Fund Governance Review was to be provided verbally.