Usually at this time of year 400 delegates gather at the Cotswolds Water Park in leafy Gloucestershire for the PLSA Local Authority Conference. There is always a strong sense of community as people who have met many times to share similar experiences and challenges get together to talk about this year’s big issues.
This year, we couldn’t be there in person, but the PLSA wanted to ensure we can still bring Local Authority members together virtually. A bit like Eurovision, as attendees in the first webinar’s chat box mused.
Here’s a summary of LA Live - a week of webinars for people involved in running the Local Government Pension Scheme, and watched by over 500 of them across the week.
MONDAY: COVID-19’S IMPACT ON THE LGPS AND THE REGULATOR’S RESPONSE
The first webinar of the series – hosted by the PLSA’s Rachel Pine, who anchored the whole week – saw Lorraine Bennett from the Local Government Association, Nick Gannon from The Pensions Regulator and Tiffany Tsang from the PLSA, discuss what impact Covid-19 has had on the LGPS and how the Pensions Regulator has responded.
Lorraine shared what the LGA is hearing from local authorities on the impact of Covid-19, and discussed the LGA’s messaging, its co-ordinated response, the resources available and longer term impacts. Tiffany explained the overall story is the LGPS is faring well during the pandemic, and spoke about some of the emerging queries from local authority members. She revealed the priorities members want the PLSA to focus on with the Regulator.
Finally, Nick gave his thoughts on whether pension scams have increased in the wake of the crisis. He also explained that while it is important to follow the law, TPR appreciates circumstances are more complicated for LA funds this year, and will take a pragmatic approach.
TUESDAY: TAKING AN EMPLOYER HEALTH CHECK – A GUIDE FOR THE LGPS
Rachel welcomed John Raisin, Independent Advisor and Chair, and Emelda Nicholroy, Head of Pensions Policy, University and Colleges Employers Association to talk about dealing with the different types of tier 3 employers (those that don’t benefit from taxpayer backing) during the pandemic.
John debunked the myths around employer strength and weakness in the LGPS, discussed Regulation 67 – Local Authorities need to be really acquainted with this – and stressed the need for fund to do their own legwork on checking employer health.
Emelda focussed on the experience of universities and the strength of their covenant. A last resort for most, deferrals could be an option for sectors such as universities, where money comes in at certain times of year, it may be looked at. But funds should not be worried about cash flow this year unless they are already negative. Early retirement, furlough and redundancy, and arrangements for charities were part of the Q&A.
Communicate, communicate, communicate is the key takeaway from the discussion. And of course as with every aspect of the LGPS, good governance and proper resourcing are the key to getting it right.
WEDNESDAY: SENSE AND SUSTAINABILITY – ESG FOR THE LGPS
Standardisation of reporting, the impact of climate change on different sectors of the economy and the importance of good stewardship were the key issues covered in the third webinar.
Caroline Escott, Policy Lead: Investment and Stewardship, PLSA and Faith Ward, Chief Responsible Investment Officer, Brunel Pension Partnership took encouragement from the fact that 58% of webinar participants confirmed that they were getting to grips with the ‘TCFD’ (Taskforce on Climate-related Financial Disclosure) framework that LA funds will be required to follow by 2022, though some LAs had clearly made more progress than others.
Both speakers encouraged PLSA members to look at analysis by the Bank of England and the Transition Pathway Initiative on the differential impact that climate change will have on each sector of the economy – crucial when shaping investment strategy.
Responding to questions, Caroline emphasised that good stewardship is the key to being a responsible investor. She pointed out that this goes beyond just voting; asset-owners should engage with their fixed income managers, as well as those managing their equity mandates, to understand how they are using the Stewardship Code. PLSA members may make use of our latest practical guidance to voting, stewardship and engagement.
THURSDAY: LGPS ADMINISTRATION – IT’S COMPLICATED!
Administrating a scheme as complex as the LGPS isn’t easy at the best of times for local authority funds dealing with hundreds of thousands of members, thousands of employers and multiple administration clients.
Jo Darbyshire, Managing Director, LPPA (Local Pensions Partnership Pensions Administration) and Yunus Gajra, Business Development Manager, West Yorkshire Pension Fund, took us through their funds’ challenges and the impact of external regulatory pressures including the McCloud Judgement and GMP reconciliation.
Using technology, overcoming jargon, embracing innovation and increasing engagement – when sometimes don’t understand pensions basics – are key themes and recently took on new importance as administration has become even more complicated as staff work remotely and the impact of Covid-19 stresses workloads.
Catch up to find out about how your peers are approaching these challenges, how the Pensions Regulator is responding and what it all means for the future.
FRIDAY: DEALING WITH COVID-19 – LGPS MEMBER SURGERY AND LAUNCH OF THE SCHEME ADVISORY BOARD'S ANNUAL REPORT
We saw a positive end to LA Live with Councillor Phillips, Joe Dabrowski and Rachel Brothwood joining us to talk about everything we covered during the week.
Councillor Phillips launched valuation results for the scheme, which was 98% funded at 31 March 2019 – with many funds in surplus and average deficits down. In any normal year, we’d be focussed on this great picture, but of course, this isn’t any normal year.
Rachel updated on her work with the practitioners’ covid-19 group and 10 weeks spent looking at operations, the payment of benefits, new benefits, and the day-to-day practicalities of getting and processing information outside of the usual working environment.
As the Scheme Advisory Board surveys have shown, local authorities have adapted well to the situation and are confident they can pay their 1.5 million pensioners. Long-term administration challenges remain top of the inbox, along with Mental Health Awareness Week over the last five days.
LA LIVE: IT’S A WRAP
As well as recordings of every webinar, you can get session slides, the Scheme Advisory Board’s Annual Report and other helpful documents on the LA Live page.
Thank you to our speakers and viewers for joining us and we hope to see you again in person at the PLSA Local Authority Conference 2021.