Governance
The following page outlines the Governance Policy Statement for pensions.
It shows how the fund's governance arrangements comply with best practice guidelines issued by the Department for Communities and Local Government.
This statement has been compiled in accordance with the provisions of The Local Government Pension Scheme (Administration) Regulations 2008 and the draft statutory guidance issued on 21 July 2008 and incorporates the changes approved by the Pensions Committee on 26 September 2008.
This document relates to the Pensions Committee in its role as an Administering Authority.
Structure
Delegation of functions
Responsibility for the council's statutory function as administering authority (other than investment matters) under the Local Government Pension Scheme Regulations and associated legislation under Sections 7, 12 and 24 of the Superannuation Act 1972 is delegated to the Pensions Committee. The minutes of the Pensions Committee are reported to the council.
The Pensions Committee also has responsibility for pensions and compensation matters for the county council in its capacity as an employing authority.
Frequency of meetings
In view of the personal nature of some of its functions and the requirement for comments on draft legislation, the Pensions Committee meets as and when there are matters to be considered.
Best practice
That an administering authority's main committee or committees meet at least quarterly.
That an administering authority's secondary committee or panel meet at least twice a year and is synchronised with the dates when the main committee sits.
That administering authorities who do not include lay members in their formal governance arrangements, provide a forum outside of those arrangements by which the interests of key stakeholders can be represented.
Compliance
a) compliant
b) not applicable
c) partial compliance − membership of the committee is to be extended to include two elected members from Derby City Council and two elected members representing the Local Government Association (Derbyshire). Trade union representatives of Derbyshire County Council and Derby City Council are to be asked to represent the interests of contributors, pensioners and deferred pensioners. However, there are no representatives of admission bodies. The AGM will give scheme members and pensioners the opportunity to raise matters with the committee.
Terms of reference
The duties and responsibilities of the Pensions Committee are within the Local Government Pension Scheme Regulations 1997 and Pensions Acts.
The committee's terms of reference, insofar as they relate to the administering authority's role, include:
administration of the LGPS in Derbyshire
consideration of applications for admission body status
appointment of actuary and additional voluntary contribution providers
formulation and review of policies relating to discretions
the appointment of persons to resolve disputes
consideration of Stage 2 appeals under the dispute resolution procedures
the formulation of a Funding Strategy Statement
obligations on administrators of occupational pensions under the various Pension Acts.
The Pensions Committee also decides on pension and compensation matters in its role as an employing authority. Certain functions have been delegated to the county treasurer and chief officers, in consultation with the Chair of the Pensions Committee. However, these functions are outside the scope of this statement.
Meetings are open to the public except for exempt and confidential items as defined by the Local Government Act 1972.
Best practice
a) The management of the administration of benefits and strategic management of fund assets clearly rests with the main committee established by the appointing council.
b) That representatives of participating LGPS employers, admitted bodies and scheme members (including pensioner and deferred members) are members of either the main or secondary committee established to underpin the work of the main committee.
c) That where a secondary committee or panel has been established, the structure ensures effective communication across both levels.
d) That where a secondary committee or panel has been established, at least one seat on the main committee is allocated for a member from the secondary committee or panel.
Compliance with best practice
a) compliant
b) partial compliance − in line with representation on the Investment Committee, membership of the Pensions Committee is to be extended to elected members representing Derby City Council and the Local Government Association (Derbyshire). Trade union representatives of Derbyshire County Council and Derby City Council are to be asked to represent the interests of contributors, pensioners and deferred pensioners. Although admission bodies are not represented on the committee, they will be invited to attend the AGM.
c) and d) - not applicable as Derbyshire County Council does not have a secondary committee or panel
Representation
Structure
The committee comprises seven elected members of the county council and receives reports from the head of corporate finance, county secretary and other chief officers as appropriate. The elected members have undertaken training on the role of the Pensions Committee.
Membership of the committee is to be extended to include two elected members from Derby City Council and two from the Local Government Association (Derbyshire). Two trade union representatives (as non-voting members) comprising one from Derbyshire County Council and one from Derby City Council are to be asked to represent the interests of contributors, pensioners and deferred pensioners.
All members (including those representing Scheme members and pensioners) are permitted to nominate substitutes.
Best practice
a) That all key stakeholders are afforded the opportunity to be represented within the main or secondary committee structure. These include:
(i) employing authorities (including non-scheme employers, eg, admitted bodies)
(ii) scheme members (including deferred and pensioner scheme members)
(iii) independent professional observers and
(iv) expert advisers (on an ad-hoc basis).
b) That where lay members sit on a main or secondary committee, they are treated equally in terms of access to papers and meetings, training and are given full opportunity to contribute to the decision making process, with or without voting rights.
Compliance
a)
(i) partial compliance − there are no representatives from admission bodies
(ii) compliant − trade union representatives represent scheme members
(iii) not required
(iv) compliant - in that they would be invited as and when required eg fund actuary.
b) compliant − lay members will be treated equally in terms of access to papers and training and will be given the opportunity to contribute to the decision making process although they will not have voting rights.
Selection and role of lay members
Best practice
a) That committee or panel members are made fully aware of the status, role and function they are required to perform on either a main or secondary committee.
b) "That at the start of any meeting, committee members are invited to declare any financial or pecuniary interest related to specific matters on the agenda."
Compliance
a) compliant - the status, role and function of committee members is included in the Governance Policy Statement − Pensions
b) compliant − Committee members are invited to declare any financial or pecuniary interest related to any specific matters on the agenda.
Voting
All elected members of the administering authority have voting rights as a matter of course.
Sections 13(3) and (4) of the Local Government and Housing Act 1989 give discretion for the Pensions Committee to decide as to whether members who are not elected members Derbyshire County Council should have voting rights.
Best practice
The policy of individual administering authorities on voting rights is clear and transparent, including the justification for not extending voting rights to each body or group represented on main LGPS committees.
Compliance
Compliant − The policy on voting is included in the Governance Policy Statement − Pensions.
Training, facility time and expenses
An annual training plan and training log are to be introduced.
Best practice
a) That in relation to the way in which statutory and related decisions are taken by the administering authority, there is a clear policy on training, facility time and reimbursement of expenses in respect of members involved in the decision-making process.
b) That where such a policy exists, it applies equally to all members of committees, sub-committees, advisory panels or any other form of secondary forum.
c) That the administering authority considers the adoption of annual training plans for committee members and maintains a log of all such training undertaken."
Compliance
a) compliant
b) not applicable
c) compliant
Access
All committee members have equal access to committee papers, documents and advice that falls to be considered at meetings
Best practice
That subject to any rules in the council's constitution, all members of main and secondary committees or panels have equal access to committee papers, documents and advice that falls to be considered at meetings of the main committee.
Compliance
Compliant
Scope
Wider scheme issues are considered by the council's Pension Committee
Best practice
That administering authorities have taken steps to bring wider scheme issues within the scope of their governance arrangements
Compliance
Compliant
Publicity
Policy documents and publications
The following pensions related documents are available to the fund's stakeholders on the councils website and in hard copy form on request. Pensions News is sent to all scheme members in paper form.
Governance Policy Statement
Funding Strategy Statement
The Funding Strategy Statement looks at the Pension Fund's liabilities and how these are to be met over the longer term.
Communications Policy Statement
This explains the communications policy with the Fund's various stakeholders.
Pensions Committee meetings
The meetings are open to members of the public other than for exempt reports (eg those dealing with individuals, financial or business affairs of a person or company). Copies of reports and minutes are available on the council's website.
Pensions News
This is a periodic publication which aims to keep Scheme members in touch with developments in the Local Government Pension Scheme and matters relating to the Pension Fund including the annual accounts
Best practice
That administering authorities have published details of their governance arrangements in such a way that stakeholders with an interest in the way in which the scheme is governed, can express an interest in wanting to be part of those arrangements
Compliance
Partial compliance − details of the Pension Fund's governance arrangements are posted on the council's website, committee meetings are open to members of the public and members are updated of Scheme developments through of Pensions News. Scheme members are invited to attend the Fund's AGM. However, the council does not invite contributors, pensioners and deferred pensioners to take part in the governance of the fund.