Agenda item

Regulatory Intervention

Minutes:

Mr George Bruce introduced the report.    He stated that The Pension Regulator (TPR) had issued a draft improvement notice to London Borough of Barnet to address weaknesses in the processes and controls within the administration of the Barnet Pension Fund.   He informed Members that the Pensions Regulator had given a deadline of 31 August 2019 to have implemented improvements in three areas.   Mr Bruce outlined what steps were in place to address concerns as outlined within the report. 

 

Mr Stephen Ross said that Board Members are not surprised with the intervention of The Pension Regulator.  He said that the Pensions Board had at every opportunity provided scrutiny and raised concerns constantly.  He stated that he felt that the Local Pension Board had been ignored and he added that he was very disappointed.    Mr Ross added that the Local Pension Board Members had not received any information in regard to the pension regulator’s intervention outside the meeting, this he noted had been requested.   He said that the Local Pension Board had flagged at every opportunity their concerns and he felt that an option was that the Local Pension Board reports itself.  Mr Ross requested to know:

-        Who would pay any fine from the Regulator if imposed?

-        What is the contingency if the deadlines are not met and the regulator feel that the Council is inadequate

-        Requested that the Local Pension Board are notified when all areas are compliant

 

The Chairman said that the role of the Local Pension Board was vague but he said he felt that the Local Pension Board’s role was to advise, encourage and to warn.   He noted that unfortunately there had been warnings that had been minuted at both Board and Committee meetings.   He said that he did not believe that the Local Pension Board had failed its duty.

 

Mr Hem Savla requested to know if the London Brough of Barnet were the only Borough to encounter such problem.     In response to this Interim Pensions Manager Mr Nigel Keogh said that there are often challenges with data but not to the extent that Barnet had experienced. 

 

 

Mr Bruce said that the process has started to put in place a contingency arrangement to appoint a new administration provider should the requirements of the improvement notice not be achieved.  He said that the Council was meeting potential organisations in order to assess their ability to provide an alternative administrating service. Mr Ross said that this he was disappointed that again members of the Board had not received any information that an improvement notice had been issued.  He said that in his view the Local Pensions Board are not been taken seriously and he noted there is no effective communication plan.  The Interim Pensions Manager Mr Nigel Keogh stared that the Council were working with Capita to deliver the improvement plan and a monthly performance report.  He confirmed that an update would be provided at a future meeting.

 

Mr Savla noted that he took comfort knowing that the Council’s Internal Audit Team would be involved in the improvement process. 

 

Mr Bruce said that the monitoring of administration had not been effective for some time.  He said that the London Brough of Barnet Pension’s Team had grown and is now better resourced. He added that the Council were previously over reliant on Capita and the information provide by them. The Chairman said that at every Pension Board meeting he had advocated that a financial penalty to employers for noncompliance be imposed.  He continued that he made representations at the Pension Fund Committee to advise that a fine be imposed.  Mr Bruce said that instead of issuing fines Officers of the Council had sought to engage with the employers who are failing to meet the statutory requirement.

 

Councillor Smith said that it was critical that the 31 August deadline set by The Pensions Regulator be met.   He said that he shared the views of fellow Board Members and also agreed that it was time to fine employers, he added that it was time to take a tougher approach.   He added that within the report, the letter from The Pensions Regulator noted that an analytical review be completed in line with the internal audit report.   Mr Bruce said that the analytical review process was now in place 

 

The Board noted that in the event of a fine from the regulator it would be payable by the Capita or the Council.   Mr Bruce said that a full update would be reported at the next meeting.  He stated that full measures would be considered in order to review all available options in order for the Council to deliver an efficient pension administrating function.

 

Having considered the report, The Local Pension Board:

 

Resolved;

-        The Local Pension Board noted the content of the draft Improvement Notice and the actions being taken to comply

-        That the Local Pension Board have at its next meeting an item that outlines a full update on the Regulatory Intervention

 

Supporting documents: