The Pensions and Investments Committee of Derbyshire Council met on Wednesday 03 June 2026 to discuss the Derbyshire Pension Fund's investment performance, actuarial valuation, and administration. The committee also reviewed the fund's risk register, climate risk management report, and plans for implementing the 'Fit for the Future' reforms for the Local Government Pension Scheme (LGPS).

Investment Report

The committee was scheduled to review the Derbyshire Pension Fund's investment performance, including its asset allocation, investment activity since the last meeting, and long-term performance analysis. The report also sought approval for the investment strategy, incorporating recommendations from the Director of Finance and the fund's independent external adviser, Mr. Fletcher. The report detailed market returns over the last 12 months, noting positive global equity returns but broadly flat UK fixed income returns. It also provided an analysis of the fund's performance against its benchmark over various periods, highlighting underperformance in global sustainable equities and private equity allocations over the one, three, and five-year periods. Recommendations were made regarding adjustments to asset class weightings, including an increase in protection assets and cash, and a decrease in growth assets.

Derbyshire Pension Fund Actuarial Valuation

A key item on the agenda was the Derbyshire Pension Fund's Actuarial Valuation at 31 March 2025. This triennial exercise determines the fund's liabilities compared to its assets and calculates the contributions needed to cover future benefits. The report indicated a significant improvement in the funding level since the previous valuation in 2022, with the funding level increasing from 100% to 135%, resulting in a larger surplus. This improvement was primarily attributed to higher assumed future investment returns. The report also detailed the combined employer contribution rates, which on average, had reduced.

LGPS Fit for the Future Implementation

The committee was set to receive an update on changes to the governance of the Local Government Pension Scheme (LGPS) and the management of LGPS investment assets arising from the Pension Schemes Act 2026 and associated regulations. This included plans for implementing the 'Fit for the Future' requirements, which aim for fewer, larger, better-managed, and better-performing pension schemes. The report noted the expansion of the LGPS Central Pool to include additional partner funds and the ongoing development of LGPS Central Limited to meet new responsibilities. The committee was asked to approve updated terms of reference for the Pensions and Investments Committee to reflect these policy changes and to note the process for appointing an Independent Person.

Half Year Pension Administration Performance Report

This report covered the period from 1 October 2025 to 31 March 2026, detailing the pension administration activity undertaken by the Derbyshire Pension Fund's administration team and the performance levels achieved. It highlighted the team's efforts to maintain operational stability despite staffing transitions and vacancies. The report noted achievements in meeting regulatory timescales for providing scheme members with information, with compliance rates of 99% or over in five out of seven key performance indicators. However, it also identified an increase in backlog cases in aggregations and deferred membership, with a dedicated backlog team being established to address these. Updates on digital solutions, including the i-Connect project for employer data submissions and the launch of an upgraded My Pension Online platform, were also included.

Risk Register

The committee was scheduled to consider the Derbyshire Pension Fund's Risk Register, which identifies and assesses key risks to the fund's objectives. The register details risk items, descriptions, impact and probability scores, current and target risk scores, and mitigation controls. Four high-risk items were highlighted: systems failure/lack of disaster recovery plan/cybercrime attack; LGPS Central Limited related underperformance of investment returns; insufficient cyber-liability insurance for the pensions administration system; and the impact of the McCloud judgement on administration. The report also noted potential emerging risks, such as the impact of local government re-organisation.

Climate Risk Management Report

The committee was presented with the Derbyshire Pension Fund's public Climate Risk Management Report, prepared by LGPS Central Limited. This report analysed the fund's approach to managing climate-related risks and opportunities, following the structure recommended by the Task Force on Climate-Related Financial Disclosures (TCFD). It included an analysis of carbon risk metrics for listed equities, fixed income, and private market funds, as well as an update on the fund's climate strategy targets. The report highlighted progress in reducing the carbon footprint of listed equities and noted that the fund's climate strategy aims for net zero carbon emissions by 2050.

Local Government Pension Scheme Investment Pooling

The committee was to receive details regarding the Derbyshire Pension Fund's involvement in investment pooling. This included an update on the LGPS Central Pool, which now comprises 14 administering authorities, and the review and updating of governance documents such as the Inter Authority Agreement and Shareholders' Agreement. A new Fiduciary Management Agreement was also agreed, outlining the arrangements for LGPSC to implement the Pension Fund's investment strategy.

Summary of AADPs and Ombudsman Escalations During 2025/26

This item was scheduled to provide a summary of applications for the Adjudication of Disagreements Procedure (AADP) and escalations to The Pensions Ombudsman during the 2025/26 financial year. This would detail any formal complaints, appeals against employer or fund decisions, and any cases referred to The Pensions Ombudsman for investigation and determination.

The agenda also included items for the exclusion of the public for confidential appendices related to the Climate Risk Management Report and Local Government Pension Scheme Investment Pooling.