The Surrey Local Pension Board noted the contents of all of the reports in the meeting pack, and made two recommendations to the Pension Fund Committee; that it review the risk score and mitigation of the risk of ongoing issues stemming from the implementation of the MySurrey financial system, and that it considers the Surrey Pension Team's draft business continuity plan.

The Impact of the MySurrey System

The ongoing issues related to the MySurrey financial system, which was implemented in June 2023, were a significant topic of discussion. The Board heard that insufficient opportunity to specify pension requirements and to test the system prior to its implementation had caused processing delays and a build-up of backlogs.

Inadequate system configuration has led to workarounds in some areas, delayed processing and/or data integrity issues.

Officers explained that a lack of accurate leaver information was a particular concern.

The biggest issue was not receiving leaver information…

The Board was informed that a working group had been established to address these issues. It was seeking solutions to the issues with leaver data, and had successfully amended the Council's data and security policy to allow the Surrey Pension Team to control user access to the system. The group has also secured a monthly return of data from Surrey Payroll via the iConnect data platform which means that the production of the 2023/24 Annual Benefit Statements can go ahead. The Board heard that the working group expected to be able to reconcile the contribution income for 2023/24.

Councillor David Lewis, Surrey County Council's cabinet member for finance, is aware of the issues and is working to resolve them. It was proposed that the Chairs of the Board and the Committee meet regularly with Councillor Lewis and the LGPS Senior Officer to ensure that they are kept up to date on the issues and the work being done to resolve them.

The Board also considered whether it should recommend to the Committee that the Council be reported to The Pensions Regulator. The LGPS Senior Officer, Neil Mason, advised that:

…if they (Surrey County Council) were not (taking serious steps on remediation), then a recommendation to the Board that Surrey County Council be reported to the Pension Regulator may be considered appropriate…

The Board agreed to monitor the situation closely.

Performance

The Board heard that the Surrey Pension Team's performance levels in quarter one of 2024/25 had fallen by 3% to 85%. The team continued to exceed the expected targets for transfers, refunds, and death grant payments. However, performance levels for retirements, survivors’ benefits, and the issuing of death grant notifications had not met the expected standards.

To address this, it was explained that the Immediate and Future Benefits Teams had been blended into two new Benefits Teams. The staff in the new teams would be trained on a wider range of case types to improve resilience in case of staff absence. It was anticipated that the new structure would also improve ownership of work within the team, as:

…(it) has enhanced the ownership of the team to see that you cannot just worry about your particular area. It's the whole shebang, I'm afraid, that we need to be prepared to divert where we need to to ensure that we're getting through the casework and the prioritization of that work.

Other Business

The Board also discussed the following:

• Legacy Case Reduction: The Board heard that the legacy case reduction project was progressing well and was ahead of schedule. It was forecast to be completed by November 2024.
• GMP Equalisation:[^2] The Board was told that work was underway to re-plan and scope the Guaranteed Minimum Pension (GMP) equalisation project with the current provider, Aptia. [^2]:GMP equalisation is the process of ensuring that men and women receive the same amount of pension benefits for the same amount of service, regardless of when they retired. This is required by law in the UK.
• McCloud:[^3] The Board received an update on the progress of the McCloud project, which is on track to be completed by the March 2025 deadline. [^3]:The McCloud judgment refers to a legal case that found that changes made to public sector pension schemes in 2015 were discriminatory against younger members. The government is now required to remedy this discrimination.
• Business Continuity: The Board considered the Surrey Pension Team's draft business continuity plan, which was produced using the Council’s template documents and with the support of the Council’s Emergency Management and Resilience Team (EMRT). It was agreed that a desktop validation exercise would be undertaken to test the plan's resilience. The plan would be reviewed once the implementation of MySurrey and the transfer of the Fund's banking controls to the Surrey Pension Team were complete.
• Investment Beliefs: The Board heard that the Pension Fund Committee had established a sub-committee to consider how its fiduciary duty relates to the objectives of the fund and its investment beliefs. All Committee members are invited to join this sub-committee, and the Chair of the Committee has indicated that he would be happy to receive comments from the Board on the sub-committee's work.
• Board Vacancy: The Board was informed that Unison would be putting forward a candidate to fill the vacant Board member representative post.

The Board also expressed its thanks to Angela Guest, who is retiring at the end of July, for her work as the Board's secretary.