The Local Pension Board of Oxfordshire Council met on 25 April 2025 to review the annual business plan, risk register, governance and communications, administration, and strategic asset allocation. The board was also scheduled to discuss items to include in the report to the Pension Fund Committee and items to be included in the agenda for the next board meeting.

Strategic Asset Allocation Review

The board was scheduled to review a report by Greg Ley, Pension Fund Investment Manager, regarding the fund’s current strategic asset allocation, the timescales for its review, and information on active versus passive investment management.

Every three years, the pension fund undertakes a fundamental review of its asset allocation to tie in with the triennial valuation of the fund. The review helps determine the strategic asset classes that the fund will invest in and then sets a target allocation and range for them. Fund officers manage the range operationally, and hold regular meetings to consider whether any rebalancing is required.

The strategic asset allocation is considered the most important investment decision undertaken by the fund, with research showing it to be the primary driver of investment performance.

The last review of the strategic asset allocation was considered by the Pension Fund Committee at their meeting on 3 March 2023. The current strategic asset allocation agreed from the fundamental review, including any subsequent changes, is:

• UK Equities 10% (Range 8-12%)
• Global Equities 41% (Range 39-43%)
• Total Equities 51% (Range 47-55%)
• Index Linked Gilts 7%
• Corporate Bonds 4%
• Multi-Asset Credit 5%
• Total Fixed Interest 16% (Range 14-18%)
• Property 8% (Range 6-10%)
• Private Equity 10% (Range 8-12%)
• Secured Income 5% (Range 4-6%)
• Infrastructure 5% (Range 4-6%)
• Private Debt 5% (Range 4-6%)
• Cash 0% (Range 0-5%)
• Total Other Assets 33% (Range 26-45%)

The allocation within Global Equities is split as follows: 16% Paris Aligned Benchmark passive global equities, 16% Sustainable Equities, 9% Global High Alpha.

The fundamental review is scheduled to take place over the second half of 2025 alongside the triennial valuation process. Draft whole fund results from the valuation are expected to be available by the end of September 2025, and a report setting out the proposed strategic asset allocation is scheduled to be taken to the Pension Fund Committee meeting on 6 March 2026.

The 2025 review is expected to take into account the draft results of the latest valuation undertaken by the Fund actuary, the Responsible Investment Policy, the government’s consultation, Local Government Pension Scheme (England and Wales): Fit for the future¹, and the latest cashflow position of the Fund and forecast over the next few years.

The report also noted that within the Fund’s current strategic allocation to equities there is a 70%/30% split between active and passive equities, and that the review will consider the appropriateness of this split.

Review of the Annual Business Plan

The board was scheduled to review the position against the Annual Business Plan for 2024/25 and the Annual Business Plan for 2025/26 as considered by the Pension Fund Committee at their meeting on 7 March 2025, and to offer any comments to the Committee.

Mark Smith, Head of Pensions, presented the report of the Executive Director of Resources and Section 151 Officer which reviewed progress against the key priorities set out in the Annual Business Plan for 2024/25. The Plan also set out the proposed business plan, budget, training plan and cash management strategy for the Pension Fund for 2025/26.

The key objectives for the Oxfordshire Pension Fund as set out in the Business Plan for 2025/26 are:

• To fulfil the fiduciary duty to all key stakeholders
• To administer pension benefits in accordance with the LGPS regulations, and the guidance set out by the Pensions Regulator
• To maintain a funding level above 100% (LGPS only)
• To ensure there are sufficient liquid resources to meet the liabilities of the Fund as they fall due
• To maintain as near stable and affordable employer contribution rates as possible

The service priorities for 2025/26 are:

• To deliver further improvements to the governance arrangements of the Fund
• To deliver further operational effectiveness of the service delivery/administration function, including delivery of regulatory changes
• To develop further the Fund’s Investment and Funding service
• To deliver service enhancements and cost reductions through increased use of technology

Risk Register

The board was scheduled to review the latest risk register as considered by the Pension Fund Committee on 7 March 2025, and to offer any further views back to the Committee.

The risk register sets out the current risk scores in terms of impact and likelihood, and a target level of risk and a mitigation action plan to address those risks that are currently not at their target score.

The key risks identified are:

• Investment Strategy not aligned with Pension Liability Profile
• Under performance of asset managers or asset classes
• Actual results vary to key financial assumptions in Valuation
• Employer Default – LGPS
• Inaccurate or out of date pension liability data
• Insufficient resources from Committee to deliver responsibilities
• Insufficient Skills and Knowledge on Committee
• Key System Failure
• Breach of Data Security including GDPR
• Failure to Meet Government Requirements on Pooling
• Failure of Pooled Vehicle to meet local objectives
• Significant change in liability profile or cash flow as a consequence of Structural Changes
• Insufficient Resource and/or Data to comply with consequences of McCloud Judgement & Sergeant
• Loss of strategic direction
• Impact of Pension Scams
• Impact of a potential turnover of Pension Fund Committee members as a result of the election

Governance and Communications Report

The board was scheduled to review the Governance and Communications Report as presented to the Committee at their meeting on 7 March 2025. The report includes a log of all regulatory and data breaches.

The key governance and communication issues for the Fund are:

• General Code of Practice
• Annual Review of Cyber Security
• Breaches for the period October to December 2024
• Communications Update

Administration Report

The board was scheduled to review the latest Administration Report as presented to the Pension Fund Committee on 7 March 2025, including the latest performance statistics for the service.

The key administration issues are:

• Service Performance
• Statutory Returns
• Fire Service Administration
• Employer Monthly Returns
• Member Self Service
• Employer SLA Monitoring
• Financial Implications
• Complaints
• Historic Death Cases
• Pension Dashboard Project
• McCloud Project
• Age Discrimination Remedy – Fire Service
• On-call Second Options Exercise – Fire Service
• Staffing