Archived decisions
Agenda item: 10
HAMPSHIRE COUNTY COUNCIL
Decision Report
Decision Maker: |
Pension Fund Panel | ||||||
Date of Decision: |
20 November 2009 | ||||||
Decision Title: |
Review of the Pension Fund's Funding Strategy Statement | ||||||
Decision Reference: |
1044 | ||||||
Report From: |
County Treasurer | ||||||
Contact name: |
Ian Howell |
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Tel: |
01962 847540 |
Email: |
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1. Executive Summary
1.1. The purpose of this report is to consider the arrangements for reviewing the Pension Fund's Funding Strategy Statement.
2. Background
2.1. Regulations require the administering authority of a Local Government Pension Scheme (LGPS) fund to prepare and publish a Funding Strategy Statement (FSS). It also has to keep its FSS under review and make such revisions that are necessary to reflect any changes in its policy on matters covered by the FSS and the Statement of Investment Principles. The administering authority must have regard to guidance published by the Chartered Institute of Public Finance and Accountancy (CIPFA). It must also consult with such persons as it considers appropriate.
2.2. The Fund Actuary is required by regulations to have regard to the FSS when preparing the actuarial valuation of the Pension Fund.
2.3. The current version of the FSS is published in the Pension Fund's Annual Report and Accounts for 2008/09.
3. Government proposals on the affordability of the LGPS
3.1. As reported to the Panel in October 2009, the Government has consulted on possible amendments to the LGPS regulations to maintain the stability, affordability and viability of the Scheme in the actuarial valuation due at 31 March 2010. This consultation recognised the unfortunate focus that arises from the current arrangements on the so-called black hole in LGPS pension funds.
3.2. That consultation closed on 30 September 2009 but as yet there has been no further indication from the Government on what changes it intends to make, if any. It is understood that the overwhelming majority of respondents favoured introducing a Financing Plan to supplement the FSS. This would set out how the Pension Fund will build on its strong liquidity, constitutional permanence and strong employers' covenants to avoid damaging increases in employers' contribution rates from 2011/12 onwards.
3.3. The Government's decision on this matter is fundamental to the revision of the FSS and so it is proposed to delay the revision until the Government has made its announcement.
4. Timetable
4.1. Hewitt Associates, the Fund Actuary, have confirmed that they do not need to have the final version of the FSS until May 2010. It will be necessary to consult the Pension Fund's employers on the draft FSS. That can be done during Spring 2010 with the final draft reported to the Panel during the next cycle of meetings in May 2010.
5. Recommendations
5.1. That the County Treasurer be authorised to continue working with the Fund Actuary to prepare a draft revised version of the Funding Strategy Statement for consultation with employers during Spring 2010.
5.2. That the final draft of the revised Funding Strategy Statement be reported to the Panel in May 2010.
i:\ . . . . \ian\docs\penpanel 201109 report trng plan1.doc 16 November 2009
CORPORATE OR LEGAL INFORMATION:
Links to the Corporate Strategy
Hampshire safer and more secure for all: |
yes/no |
Corporate Business plan link number (if appropriate): | |
Maximising well-being: |
yes/no |
Corporate Business plan link number (if appropriate): | |
Enhancing our quality of place: |
yes/no |
Corporate Business plan link number (if appropriate): | |
OR | |
This proposal does not link to the Corporate Strategy but, nevertheless, requires a decision because actions are required to make sure that the Pension Fund's Funding Strategy Statement is revised. | |
Other Significant Links
Links to previous Member decisions: |
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Direct links to specific legislation or Government Directives |
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Section 100 D - Local Government Act 1972 - background documents | |
The following documents discuss facts or matters on which this report, or an important part of it, is based and have been relied upon to a material extent in the preparation of this report. (NB: the list excludes published works and any documents which disclose exempt or confidential information as defined in the Act.) | |
Document |
Location |
IMPACT ASSESSMENTS:
1. Equalities Impact Assessment:
1.1. Equality objectives are not considered to be adversely affected by the proposals in this report.
2. Impact on Crime and Disorder:
2.1. The proposals in this report are not considered to have any direct impact on the prevention of crime.
3. Climate Change:
a) How does what is being proposed impact on our carbon footprint / energy consumption?
No specific impact.
b) How does what is being proposed consider the need to adapt to climate change, and be resilient to its longer term impacts?
No specific impact.