dorset county pension fund board effectiveness · given the rapid and far reaching changes in our...

DORSET COUNTY PENSION FUND BOARD EFFECTIVENESS June 2017

JLT | FUND | INTRODUCTION 2

TABLE OF CONTENTS Introduction 3

Section 1 – General 5

Section 2 – Duties 9

Section 3 – Governance 13

Section 4 – Decision-Making 16

Section 5 – Communications and Relationships 18

Section 6 – Elections and Succession Planning 20

Section 7 – Knowledge and Understanding 22

Section 8 – Group Meetings 24

Section 9 – Sub Committee meetings (if applicable) 27

Section 10 – Compliance and Legislation 28

Section 11 – DC Principles 31

Section 12 – Funding, Investment and Covenant 33

Section 13 – Reflection of The Past Year 35


Given the rapid and far reaching changes in our pension landscape over the last few years, many pensions supervisory boards have not had time to step back and consider how effective they are in governing their pension schemes. The Pensions Regulator (tPR) published research in October 2015 on the ability of pension scheme trustees and their Groups to fulfil effectively their roles and responsibilities. Pensions Boards and Committees responsible for the oversight of pension funds in the LGPS were, as far as we are aware, not part of this survey but we believe that the results may be relevant.

“All trustees, some of whom are lay people with very little pensions’ experience, are required to do an increasingly complicated job, and so we are asking how we can further support trustees in fulfilling their important role.”

The Pensions’ Board of the Dorset County Pension Fund has completed self-assessment questionnaires to consider their effectiveness. The on-line questionnaire has been completed by four members of the Board and the results are set out within this report together, with recommendations based on these findings.

Overall questionnaire results

0

1

2

3

4

5

General Duties -Individual

Participation

Duties - GroupParticipation

Duties - ChairParticipation

Governance Decision-making Communication& Relationships

Elections &Succession

Planning

Knowledge &Understanding

Group Meetings Sub-CommitteeMeetings

Compliance &Legislation

INTRODUCTION


Overall observations and recommendations

Overall, this is a good set of results that reveals no serious governance deficiencies.

There seem to have been past problems with decision-making in terms of attendance and these have been addressed by expanding the number of members in the Group. As a result, two of the respondents had little experience of meetings on which to base some responses and so answered as “not known” or cautiously. It would be worth repeating this exercise in a year.

We have identified some areas where the Group could take action to follow-up some observations and these are described below.

Review the induction process for new members to cover the range of agreed protocols, registers, decision-making process, adviser and supplier monitoring, etc.

Develop a programme of training to address particular aspects of governance; identify where training needs to be refreshed and build training into an annual business plan.

Develop and annual business plan and ensure actions are captured into relevant agendas.

Receive representation from the Administrator on how it manages the risk of pensions liberation fraud and QROPS.

Receive representation from the Administrator on how it maintains data integrity and report on the data integrity scores as recommended by the Regulator.

Consider setting up an employer forum to encourage dialogue on operational issues, member engagement and pensions strategy.

Introduce informal review of the roles of officers and support to the Group, possibly annually.

Look at the AVC arrangements to ensure that charging and performance is being monitored and that there are no issues with the policies.

Consider introducing some form of member feed-back to gauge the success of communications exercises and knowledge of the Fund and its benefits and options.

JLT | FUND | SECTION 1 – GENERAL 5

General

0

1

2

3

4

5

We have agreed a setof objectives for ourGroup based on theresponsibilities of the

Group and aremeeting these.

We are governing theFund effectively.

Our Group is the rightsize to carry out itsduties effectively.

Our Group structurepromotes effective and

timely decisionmaking.

We have the right mixof skills and

competencies in orderto carry out our duties.

We utilise the fullpotential value of the

skills andcompetencies of allthe members of our

Group.

The structure of theGroup and committees

provides sufficientoversight of delegated

activities.

We know to whom anypowers and

responsibilities havebeen delegated, and

on what terms.

We understand whatpowers and

responsibilities havebeen delegated to anySub-Committees, and

on what terms.

SECTION 1 – GENERAL


Not

Applicable Not

Known Strongly Disagree Disagree Agree

Strongly Agree

Average Score

We have agreed a set of objectives for our Group based on the responsibilities of the Group and are meeting these.

0% 25% 0% 0% 75% 0% 3.00

We are governing the Fund effectively. 0% 50% 0% 0% 50% 0% 2.00

Our Group is the right size to carry out its duties effectively. 0% 0% 0% 0% 100% 0% 4.00

Our Group structure promotes effective and timely decision making. 0% 0% 0% 0% 100% 0% 4.00

We have the right mix of skills and competencies in order to carry out our duties.

0% 50% 0% 0% 50% 0% 2.00

We utilise the full potential value of the skills and competencies of all the members of our Group.

0% 25% 0% 25% 50% 0% 2.75

The structure of the Group and committees provides sufficient oversight of delegated activities.

0% 0% 0% 25% 75% 0% 3.75

We know to whom any powers and responsibilities have been delegated, and on what terms.

0% 25% 0% 0% 75% 0% 3.00

We understand what powers and responsibilities have been delegated to any Sub-Committees, and on what terms.

25% 0% 0% 0% 75% 0% 3.00

0

1

2

3

4

5

There is a fairdivision of work

andresponsibilitybetween the

members of ourGroup.

We successfullymonitor the

performance ofour delegatedauthorities e.g.

Group Secretary

Officers InvestmentManagers

Administrators Advisers Other There issufficient

resourcing tosupport the

Group Membersand their

responsibilities.

We assess theperformance of

the GroupSecretary and/orPensions Officer.

We are aware ofour conflicts of

interest andmanage them

well.

We never feelthat individual

Group Membersdominate

proceedings orhave undue

influence overdecisions.


Not

Applicable Not


Strongly Agree

Average Score

There is a fair division of work and responsibility between the members of our Group.

0% 25% 0% 0% 75% 0% 3.00

We successfully monitor the performance of our delegated authorities e.g. Group Secretary 0% 25% 0% 25% 50% 0% 2.75

Officers 0% 25% 0% 25% 50% 0% 2.75

Investment Managers 0% 0% 0% 50% 25% 25% 3.75

Administrators 0% 0% 0% 25% 75% 0% 3.75

Advisers 0% 0% 0% 25% 75% 0% 3.75

Other 50% 0% 0% 0% 50% 0% 2.00

There is sufficient resourcing to support the Group Members and their responsibilities.

0% 25% 0% 0% 75% 0% 3.00

We assess the performance of the Group Secretary and/or Pensions Officer.

0% 25% 0% 25% 50% 0% 2.75

The reporting from the Group Secretary or Pensions Officer to the Group is sufficient to allow us to have oversight of any delegated activity.

0% 25% 0% 25% 50% 0% 2.75

We are aware of our conflicts of interest and manage them well. 0% 0% 0% 0% 100% 0% 4.00

We never feel that individual Group Members dominate proceedings or have undue influence over decisions.

0% 0% 25% 0% 75% 0% 3.50


Additional comments from respondents

Observations

The results suggest that there may be some concern over the effectiveness of the governance and the mix of skills residing in the Group. The mix of skills point above could be related to the score concerning dominance/ influence in proceedings. Monitoring the performance of the Secretary and offices shows that 50% of respondents were not aware of whether these roles were being monitored or did not think that monitoring

was adequate. Lack of awareness is an issue in itself therefore the accountability of some roles may need some consideration. Investment management and administration services scored well in terms of monitoring; this a positive result for these key areas of activity.

Recommendations

It would be worth assessing skills across the Group in order to determine any gaps and build a training programme for the coming year to address the gaps and serve as a refresh for others in the light of TPR Code 14

The Group members might like to consider introducing some form of informal annual assessment of roles to check that these are meeting objectives/expectations and to identify any aspects of the roles that may need to be reviewed.

JLT | FUND | SECTION 2 – DUTIES 9

Section 2.1 – Individual Participation

Not

Applicable Not


Strongly Agree

Average Score

I attend most (if not all) the meetings I am required to attend. 0% 0% 0% 0% 75% 25% 4.25

I understand my role and responsibilities as a Group Member. 0% 0% 0% 0% 75% 25% 4.25

I understand my priorities as a Group Member. 0% 0% 0% 0% 100% 0% 4.00

I contribute to discussions in meetings with confidence. 0% 0% 0% 0% 50% 50% 4.50

I feel able to raise questions and challenge advisers in meetings. 0% 0% 0% 0% 25% 75% 4.75

I seek clarification on matters that I do not understand. 0% 0% 0% 0% 50% 50% 4.50

I have sufficient time to carry out my role. 0% 0% 0% 0% 100% 0% 4.00

I have sufficient expertise to carry out my role. 0% 25% 0% 25% 25% 25% 3.00

I am able to work with other Group Members as part of a team. 0% 25% 0% 0% 75% 0% 3.00

0

1

2

3

4

5

I attend most (if not all)the meetings I amrequired to attend.

I understand my roleand responsibilities as

a Group Member.

I understand mypriorities as a Group

Member.

I contribute todiscussions inmeetings withconfidence.

I feel able to raisequestions and

challenge advisers inmeetings.

I seek clarification onmatters that I do not

understand.

I have sufficient time tocarry out my role.

I have sufficientexpertise to carry out

my role.

I am able to work withother Group Members

as part of a team.

SECTION 2 – DUTIES


Section 2.2 – Group Participation

Not

Applicable Not


Strongly Agree

Average Score

We monitor our own performance as measured against our objectives and goals. 0% 25% 0% 25% 50% 0% 2.75

Our Group members attend the meetings they are expected to attend. 0% 25% 0% 50% 25% 0% 2.50

All Group members contribute to meetings. 0% 25% 0% 50% 25% 0% 2.50

Collectively, our Group demonstrates a good understanding of its roles and responsibilities. 0% 0% 0% 25% 75% 0% 3.75

The Group members show a strong commitment to the role. 0% 25% 0% 25% 50% 0% 2.75

Our Group members regularly demonstrate independent and good judgement in the discharge of their duties. 0% 0% 0% 25% 75% 0% 3.75

Our Group members provide constructive challenge during meeting discussions. 0% 0% 0% 0% 100% 0% 4.00

We work well together as team. 0% 0% 0% 0% 100% 0% 4.00

1.00

2.00

3.00

4.00

5.00

We monitor our ownperformance as

measured against ourobjectives and goals.

Our Group Membersattend the meetings theyare expected to attend.

All Group Memberscontribute to meetings.

Collectively, our Groupdemonstrates a good

understanding of its rolesand responsibilities.

The Group Membersshow a strong

commitment to the role.

Our Group Membersregularly demonstrateindependent and good

judgement in thedischarge of their duties.

Our Group Membersprovide constructive

challenge during meetingdiscussions.

We work well together asteam.


Section 2.3 – Chairmen Participation

Not

Applicable Not


Strongly Agree

Average Score

The Chairperson represents the Group as and when necessary in discussions with the Sponsoring Employers and other relevant parties.

0% 25% 0% 0% 50% 25% 3.25

The Chairperson leads the Group effectively. 0% 0% 0% 0% 75% 25% 4.25

The Chairperson is usually available (by email and telephone) to discuss questions raised by Group Members and others involved with the Fund between meetings.

0% 50% 0% 0% 50% 0% 2.00

The Chairperson provides helpful guidance on identifying and managing conflicts of interest.

0% 50% 0% 0% 50% 0% 2.00

The Chairs of any Committees lead the Committees effectively. 25% 25% 0% 0% 50% 0% 2.00

0

1

2

3

4

5

The Chairperson represents the Groupas and when necessary in discussions

with the Sponsoring Employers and otherrelevant parties.

The Chairperson leads the Groupeffectively.

The Chairperson is usually available (byemail and telephone) to discuss

questions raised by Group Members andothers involved with the Fund between

meetings.

The Chairperson provides helpfulguidance on identifying and managing

conflicts of interest.

The Chairs of any Committees lead theCommittees effectively


Additional comments

I am a new member - to date only attended one meeting We have recently increased the size of the Group as we were finding some difficulty in remaining quorate with only six members.

Observations

The question of adequacy of expertise arises again in Section 2.1 and is consistent with the responses in Section 1. Section 2.2 indicates that there could be an issue with attendance at meetings and one comment suggests that he Group recently expanded in size to help facilitate its ability to be

quorate. The Chairperson’s role and performance appears to be well-regarded.

Recommendations

The Group should consider receiving training on Code 14 and its practical application. This will include the guidance on knowledge and understanding and the importance of attendance and conduct at meetings.

JLT | FUND | SECTION 3 – GOVERNANCE 13

Governance

Governance (Cont’d.)

0

1

2

3

4

5

I have access to up-to-datecopies of the key Fund andLGPS governing documents

and can find them quickly andeasily.

The Group has a conflicts ofinterest policy.

The Group has a register ofinterests and it is reviewedregularly (at least once a

year).

I have made all relevantdisclosures of interests.

The Group has a "businessplan" or timetable of events.

The Group has a risk registerand is it reviewed regularly.

I believe that the Group isaware of its risks and that

these are managedappropriately.

The Group meets with theFund's external auditors at

least once a year.

Independent reports on theinternal controls of third partysuppliers (e.g. administrator,fund manager, custodian) are

reviewed by the auditor atleast annually and comments

are reviewed by the Group

0

1

2

3

4

5

The Group reviews theperformance and contracts of

service providers regularly on thebasis of an agreed timetable.

The Group monitors an overallFund budget and cashflowforecast at each meeting.

There is a process to ensure thatthe Fund documents remain

complete and up-to-date.

There is an effective process inplace for resolving disputes inrelation to the Fund and this is

compliant with regulation.

The Group is confident that theFund's internal controls are

adequate and fit for purpose.

The Group has a process toreview regularly the performance

of its advisers, providers andsuppliers.

There is an effective procedure forliaising with the Sponsors

regularly.

There is a clear decision makingprocess within the Sponsors on

pensions matters.

SECTION 3 – GOVERNANCE


Not

Applicable Not


Strongly Agree

Average Score

I have access to up-to-date copies of the key Fund and LGPS governing documents and can find them quickly and easily.

0% 0% 0% 0% 75% 25% 4.25

The Group has a conflicts of interest policy. 0% 25% 0% 0% 50% 25% 3.25

The Group has a register of interests and it is reviewed regularly (at least once a year). 0% 50% 0% 0% 25% 25% 2.25

I have made all relevant disclosures of interests. 0% 0% 0% 0% 25% 75% 4.75

The Group has a "business plan" or timetable of events. 0% 25% 0% 25% 50% 0% 2.75

The Group has a risk register and is it reviewed regularly. 0% 50% 0% 0% 25% 25% 2.25

I believe that the Group is aware of its risks and that these are managed appropriately. 0% 25% 0% 0% 75% 0% 3.00

The Group meets with the Fund's external auditors at least once a year. 0% 0% 0% 25% 50% 25% 4.00

Independent reports on the internal controls of third party suppliers (e.g. administrator, fund manager, custodian) are reviewed by the auditor at least annually and comments are reviewed by the Group.

0% 0% 0% 0% 75% 25% 4.25

The Group reviews the performance and contracts of service providers regularly on the basis of an agreed timetable.

25% 0% 0% 0% 75% 0% 3.00

The Group monitors an overall Fund budget and cashflow forecast at each meeting. 0% 0% 0% 0% 100% 0% 4.00

There is a process to ensure that the Fund documents remain complete and up-to-date.

0% 25% 0% 0% 50% 25% 3.25

There is an effective process in place for resolving disputes in relation to the Fund and this is compliant with regulation.

0% 25% 0% 0% 50% 25% 3.25

The Group is confident that the Fund's internal controls are adequate and fit for purpose.

0% 25% 0% 0% 25% 50% 3.50

The Group has a process to review regularly the performance of its advisers, providers and suppliers.

0% 25% 0% 0% 75% 0% 3.00

There is an effective procedure for liaising with the Sponsors regularly. 25% 50% 0% 0% 25% 0% 1.00

There is a clear decision making process within the Sponsors on pensions matters. 25% 50% 0% 0% 25% 0% 1.00


Additional comments

As a Board member I am not involved in specific dealings with sponsors

Observations

Not all Group members are aware of the register of interests, risk register or business plans all of which are important to the successful governance of the Fund. There appears to be a low level of engagement with participating employers. These sponsors are often key in getting messages to members and could be important in ensuring good

member outcomes.

Recommendations

The Group should consider developing a formal on-boarding plan for new members that covers all the essential elements of the role, the governance policies, registers, protocols and plans. This may also include some basis training for the role depending upon the existing skill set.

The Group might like to consider setting up an employer forum to enable dialogue on a range of subjects including operational challenges and member engagement.

JLT | FUND | SECTION 4 – DECISION-MAKING 16

Decision-Making

Not Applicable

Not Known

Strongly Disagree Disagree Agree

Strongly Agree

Average Score

The Group's goals and process for decision making is known by all Group Members and defined.

0% 25% 0% 0% 75% 0% 3.00

The Group refers to its professional advisers as part of the decision-making process, where appropriate.

0% 25% 0% 0% 50% 25% 3.25

Potential scenarios and resulting risks are considered when making decisions.

0% 25% 0% 0% 75% 0% 3.00

The Group usually makes decisions easily. 0% 0% 0% 0% 75% 25% 4.25

The Group considers the effectiveness of decisions taken and those involved.

0% 25% 0% 0% 75% 0% 3.00

0

1

2

3

4

5

The Group's goals and process fordecision making is known by all Group

Members and defined.

The Group refers to its professionaladvisers as part of the decision-making

process, where appropriate.

Potential scenarios and resulting risksare considered when making decisions.

The Group usually makes decisionseasily.

The Group considers the effectivenessof decisions taken and those involved.

SECTION 4 – DECISION-MAKING

JLT | FUND | SECTION 4 – DECISION-MAKING 17

Additional comments

None

Observations

There seem to be no issues with this section; it is good that the members are confident in their decision-making.

Recommendations

Information about decision-making could be included in an on-boarding pack for new members.

JLT | FUND | SECTION 5 – COMMUNICATIONS AND RELATIONSHIPS 18

Community and Relationships

0

1

2

3

4

5

We keep our Fundmembers informed

about changes in thepensions landscape

and regulation.

All ourcommunications with

our Fund members areclear, helpful and

written in plain English.

We communicate withFund members

regularly and we havea means of collating

feed-back.

We have low levels ofadverse feed-back and

no reason to believethat we are notcommunicating

effectively with Fundmembers

The Sponsorrecognises the

separate roles andresponsibilities of the

trustees and theSponsor in terms ofcommunicating with

members.

The Sponsor hasidentified point(s) ofcontact for pensions

issues with theSponsoring

organisation and alldelegated authorities

so that the Groupknows with whomissues should be

raised.

The Group is keptaware of the Sponsor's

policy with regard topensions and the Fund

The Sponsor iscommitted to enabling

Group Members tohave sufficient timeand training to carry

out their rolesconfidently andcompetently.

The Sponsors are alertto the areas of

potential conflict ofinterest between theirstaff and members of

the Group.

SECTION 5 – COMMUNICATIONS AND RELATIONSHIPS

JLT | FUND | SECTION 5 – COMMUNICATIONS AND RELATIONSHIPS 19

Not

Applicable Not


Strongly Agree

Average Score

We keep our Fund members informed about changes in the pensions landscape and regulation.

0% 0% 0% 0% 75% 25% 4.25

All our communications with our Fund members are clear, helpful and written in plain English.

0% 0% 0% 0% 75% 25% 4.25

We communicate with Fund members regularly and we have a means of collating feed-back.

0% 0% 0% 0% 75% 25% 4.25

We have low levels of adverse feed-back and no reason to believe that we are not communicating effectively with Fund members

0% 50% 0% 0% 50% 0% 2.00

The Sponsor recognises the separate roles and responsibilities of the Group and the Sponsor in terms of communicating with Fund members.

0% 25% 0% 0% 75% 0% 3.00

The Sponsor has identified point(s) of contact for pensions issues within the Sponsoring organisation and all delegated authorities so that the Group knows with whom issues should be raised.

0% 0% 0% 0% 100% 0% 4.00

The Group is kept aware of the Sponsor's policy with regard to pensions and the Fund.

0% 50% 0% 0% 50% 0% 2.00

The Sponsor is committed to enabling Group Members to have sufficient time and training to carry out their roles confidently and competently.

0% 25% 0% 0% 75% 0% 3.00

The Sponsors are alert to the areas of potential conflict of interest between their staff and members of the Group.

0% 25% 0% 0% 75% 0% 3.00

Additional comments

Observation and Recommendation

The Group does not seem to have a reliable means of assessing how successful it is with member engagement. The Group might like to consider reviewing how it obtains feed-back from members.

JLT | FUND | SECTION 6 – ELECTIONS AND SUCCESSION PLANNING 20

Elections and Succession Planning

0

1

2

3

4

5

All Group Members are elected in an effectivemanner.

There are no issues concerning inquorate meetingsaffecting the ability to make important decisions.

Where applicable, Group Members are assigned toSub-Committees based on their skills and

knowledge.

Where applicable, the Chairs of Sub-Committeesare appointed based on their skills and knowledge.

We have a robust policy on the election andappointment of Group Members.

SECTION 6 – ELECTIONS AND SUCCESSION PLANNING

Not Applicable

Not Known

Strongly Disagree Disagree Agree

Strongly Agree

Average Score

All Group Members are elected in an effective manner. There are no issues concerning inquorate meetings affecting the ability to make important decisions.

0% 0% 0% 0% 75% 25% 4.25

Where applicable, Group Members are assigned to Sub-Committees based on their skills and knowledge.

25% 25% 0% 0% 50% 0% 2.00

Where applicable, the Chairs of Sub-Committees are appointed based on their skills and knowledge.

25% 25% 0% 0% 50% 0% 2.00

We have a robust policy on the election and appointment of Group Members.

0% 25% 0% 0% 50% 25% 3.25

JLT | FUND | SECTION 6 – ELECTIONS AND SUCCESSION PLANNING 21

Additional comments

Observations and Recommendation

The question of skills and knowledge is raised again enforcing the suggestion that training for the Group and the induction of new members needs to be reviewed.

JLT | FUND | SECTION 7 – KNOWLEDGE AND UNDERSTANDING 22

Knowledge and Understanding

0

1

2

3

4

5

I am conversant withthe key Fund

documents andregulation governing

the LGPS.

I have sufficientknowledge and

understanding toenable me to

discharge my dutiesappropriately.

I read the PensionsRegulator's Guidance(coder 14) and keep

up to date onpensions issues.

There is an inductionprocess for new

Group Members whichis good preparation for

the role.

I am encouraged andable to obtain the

training which I needand this is recorded in

a log.

I have worked throughthe Pensions

Regulator's Trustee"toolkit".

I have undertakentraining in the last 12months to enable me

to perform my rolemore effectively.

As a Group weroutinely assess our

training needs.

As a Group we havereceived training in the

last 12 months toensure that weunderstand the

changes in pensions.

SECTION 7 – KNOWLEDGE AND UNDERSTANDING

JLT | FUND | SECTION 7 – KNOWLEDGE AND UNDERSTANDING 23

Not

Applicable Not


Strongly Agree

Average Score

I am conversant with the key Fund documents and regulation governing the LGPS.

0% 0% 0% 0% 75% 25% 4.25

I have sufficient knowledge and understanding to enable me to discharge my duties appropriately.

0% 25% 0% 0% 50% 25% 3.25

I read the Pensions Regulator's Guidance (code 14) and keep up to date on pensions issues.

0% 0% 0% 0% 75% 25% 4.25

There is an induction process for new Group Members which is good preparation for the role.

0% 25% 0% 0% 75% 0% 3.00

I am encouraged and able to obtain the training which I need and this is recorded in a log.

0% 0% 0% 25% 75% 0% 3.75

I have worked through the Pensions Regulator's Trustee "toolkit". 0% 0% 25% 0% 50% 25% 3.75

I have undertaken training in the last 12 months to enable me to perform my role more effectively.

0% 0% 25% 0% 50% 25% 3.75

As a Group, we routinely assess our training needs. 0% 25% 0% 0% 75% 0% 3.00

As a Group, we have received training in the last 12 months to ensure that we understand the changes in pensions.

0% 0% 0% 0% 75% 25% 4.25

Additional comments

Observations and Recommendation

These results are not entirely consistent with similar earlier responses. Half the Group has undertaken the tPR Toolkit which gives relevant and valuable information but others may benefit from taking this online course.

JLT | FUND | SECTION 8 – GROUP MEETINGS 24

Group Meetings

0

1

2

3

4

5

I receive themeeting papersin sufficient timeto allow me toundertake a

proper review inadvance ofmeetings.

I read my paperscarefully in

advance of themeeting, and thepapers generallycontain enoughinformation to

enable theGroup to maketimely decisionsat the meeting.

Our meetingsare planned well

in advance.

We avoidconsidering last-minute papers

whereverpossible.

The Group canidentify priorities

clearly andeasily and

ensures thatthese are

covered at eachmeeting.

I believe that weuse our advisers

efficiently atmeetings.

Our meetingsare managedeffectively andwe are able to

reachconclusions on

issues thatrequire

decisions,without deferralor the need for

moreinformation.

Group meetingsare held with the

appropriatefrequency inorder to carry

out our businesseffectively.

Meetings arechaired in an

impartialmanner, seeking

consensuswithout

compromisingthe integrity of

decision-making.

Our discussionsinclude frank

and openexchanges of

ideas among theGroup Membersbefore decisions

are made.

The views of allGroup Members

are activelysolicited during

meetings.

I receive thedraft minutespromptly aftereach meeting.

I am satisfiedthat the Group

keeps clear andaccurate recordsof all meetings.

I am confidentthat members

who are unableto attend

meetings areappropriately

briefedsubsequent to

the meeting in atimely manner.

SECTION 8 – GROUP MEETINGS


Not

Applicable Not


Strongly Agree

Average Score

I receive meeting papers in sufficient time to allow me to undertake a proper review in advance of meetings.

0% 0% 0% 0% 75% 25% 4.25

I read my papers carefully in advance of the meeting, and the papers generally contain enough information to enable the Group to make timely decisions at the meeting.

0% 0% 0% 0% 75% 25% 4.25

Our meetings are planned well in advance. 0% 0% 0% 0% 50% 50% 4.50

We avoid considering last-minute papers wherever possible. 0% 25% 0% 0% 50% 25% 3.25

The Group can identify priorities clearly and easily and ensures that these are covered at each meeting.

0% 0% 0% 0% 100% 0% 4.00

I believe that we use our advisers efficiently at meetings. 0% 0% 0% 0% 75% 25% 4.25

Our meetings are managed effectively and we are able to reach conclusions on issues that require decisions, without deferral or the need for more information.

0% 0% 0% 25% 75% 0% 3.75

Group meetings are held with the appropriate frequency in order to carry out our business effectively.

0% 0% 0% 25% 75% 0% 3.75

Meetings are chaired in an impartial manner, seeking consensus without compromising the integrity of decision-making.

0% 0% 0% 0% 75% 25% 4.25

Our discussions include frank and open exchanges of ideas among the Group Members before decisions are made.

0% 0% 0% 0% 100% 0% 4.00

The views of all Group Members are actively solicited during meetings.

0% 0% 0% 0% 100% 0% 4.00

I receive the draft minutes promptly after each meeting. 0% 0% 0% 25% 50% 25% 4.00

I am satisfied that the Group keeps clear and accurate records of all meetings.

0% 25% 0% 0% 50% 25% 3.25

I am confident that members who are unable to attend meetings are appropriately briefed subsequent to the meeting in a timely manner.

0% 50% 0% 0% 50% 0% 2.00


Additional comments

Observation and Recommendation

An overall strong result. Some consideration should be given to what might be done to enable decisions to be made without deferral or increasing the frequency of meetings.

JLT | FUND | SECTION 9 – SUB COMMITTEE MEETINGS (IF APPLICABLE) 27

SECTION 9 – SUB COMMITTEE MEETINGS (IF APPLICABLE) Sub Committee Meetings

Not

Applicable Not Known Strongly Disagree Disagree Agree

Strongly Agree

Average Score

Our Committees are effective, achieve their objective and keep me well-informed.

25.0% 0% 0% 0% 75% 0% 3.00

Sub-Committee meetings are held with the appropriate frequency in order to carry out Committee business effectively.

50.0% 0% 0% 0% 50% 0% 2.00

I believe that the Group has given clear and documented responsibilities and powers to the Committees and that we receive regular reports of performance against same.

25.0% 0% 0% 0% 75% 0% 3.00

0

1

2

3

4

5

Our Committees are effective, achieve their objective and keep me well-informed. Sub-Committee meetings are held with the appropriate frequency in order to carry outCommittee business effectively.

I believe that the Group has given clear and documented responsibilities and powers to theCommittees and that we receive regular reports of performance against same.

JLT | FUND | SECTION 10 – COMPLIANCE AND LEGISLATION 28

Compliance and Legislation

Compliance and Legislation (Cont’d)

0

1

2

3

4

5

I understand the requirementsof Auto-enrolment and I amconfident that the Fund (if

applicable) complies with allthe requirements of aQualifying Scheme.

We have reviewed theprovisions in the pension

reforms compared with ourcurrent practice and areconfident that we have

amended all the administrativeactivities as required.

We have reviewed all ourcommunications with

members with regard to thepension reforms and recent

tax changes.

We have considered theflexibilities newly available tomembers of DC schemes (ifapplicable) and the potentialimpact on member behaviour

in DB schemes.

I am confident that we have areliable process in place to

collect evidence of IFA adviceon transfers of £30,000 or

more.

We have reviewed ourprotocols and controls in placeto manage the risk of pensionliberation fraud in the light of

new guidance.

We have informed ourmembers of the reduction in

the Lifetime Allowance from 6April 2016 and the AnnualAllowance from April 2017.

We are fully au fait with thechanges in pensions

legislation in 2016 and 2017and are confident that we

understand how these mayimpact our fund and member

behaviour.

We have carried out acommon and conditional datavalidation exercise and have

certificates containing therelevant scores.

0

1

2

3

4

5

We have in place a plan tocollect missing data within

a given time-scale.

We have investigated ourGMP liabilities with HMRCrecords and have a plan in

place to reconcile ourmembership and GMP

values with HMRC.

We are fully conversantwith Disclosure

requirements and we areconfident that we are

meeting these regularly.

We have reviewed ourpolicy and procedures in

line with HMRC changes toQROPS and have put in

place procedures to collectadditional tax where

appropriate.

We are aware of the newGeneral Data ProtectionRegulations and have

plans to be compliant byApril 2018 with our

Administrator.

We are familiar with HMRCreporting requirements andreceive confirmation that allthese have been met within

regulatory timeframes.

We are familiar with tPRrequirements regarding

Fund returns and wesubmit these successfully,

on time each year.

We are familiar with tPRrequirements regarding

Notifiable Events and havemade reports where

appropriate.

We have considered howthe changes to the State

pension with effect from 6April 2016 will impact our

scheme.

We are aware of newHMRC requirements

regarding electronic dataexchange and have

discussed plans with ourAdministrator.

SECTION 10 – COMPLIANCE AND LEGISLATION


Not


Strongly Agree

Average Score

I understand the requirements of Auto-enrolment and I am confident that the Fund (if applicable) complies with all the requirements of a Qualifying Scheme.

25% 0% 0% 0% 50% 25% 3.25

We have reviewed the provisions in the pension reforms compared with our current practice and are confident that we have amended all the administrative activities as required.

0% 25% 0% 0% 50% 25% 3.25

We have reviewed all our communications with members with regard to the pension reforms and recent tax changes.

0% 0% 0% 0% 100% 0% 4.00

We have considered the flexibilities newly available to members of DC schemes (if applicable) and the potential impact on member behaviour in DB schemes.

25% 25% 0% 0% 50% 0% 2.00

I am confident that we have a reliable process in place to collect evidence of IFA advice on transfers of £30,000 or more.

0% 50% 0% 0% 50% 0% 2.00

We have reviewed our protocols and controls in place to manage the risk of pension liberation fraud in the light of new guidance.

0% 50% 0% 25% 25% 0% 1.75

We have informed our members of the reduction in the Lifetime Allowance from 6 April 2016 and the Annual Allowance from April 2017.

0% 0% 0% 0% 100% 0% 4.00

We are fully au fait with the changes in pensions legislation in 2016 and 2017 and are confident that we understand how these may impact our fund and member behaviour.

0% 25% 0% 0% 75% 0% 3.00

We have carried out a common and conditional data validation exercise and have certificates containing the relevant scores.

0% 50% 0% 0% 50% 0% 2.00

We have in place a plan to collect missing data within a given time-scale. 0% 0% 0% 0% 100% 0% 4.00

We have investigated our GMP liabilities with HMRC records and have a plan in place to reconcile our membership and GMP values with HMRC.

0% 25% 0% 0% 75% 0% 3.00

We are fully conversant with Disclosure requirements and we are confident that we are meeting these regularly.

0% 25% 0% 0% 75% 0% 3.00

We have reviewed our policy and procedures in line with HMRC changes to QROPS and have put in place procedures to collect additional tax where appropriate.

0% 75% 0% 0% 25% 0% 1.00


Not


Strongly Agree

Average Score

We are aware of the new General Data Protection Regulations and have plans to be compliant by April 2018 with our Administrator.

0% 25% 0% 0% 75% 0% 3.00

We are familiar with HMRC reporting requirements and receive confirmation that all these have been met within regulatory timeframes.

0% 50% 0% 0% 50% 0% 2.00

We are familiar with tPR requirements regarding Fund returns and we submit these successfully, on time each year.

0% 25% 0% 0% 75% 0% 3.00

We are familiar with tPR requirements regarding Notifiable Events and have made reports where appropriate.

0% 25% 0% 0% 75% 0% 3.00

We have considered how the changes to the State pension with effect from 6 April 2016 will impact our scheme.

0% 25% 0% 0% 75% 0% 3.00

We are aware of new HMRC requirements regarding electronic data exchange and have discussed plans with our Administrator.

0% 50% 0% 0% 50% 0% 2.00

Additional comments

Observations

There is a little uncertainty around pensions liberation fraud, QROPS, Data integrity scores and HMRC compliance.

Recommendations

Would be worth asking the Administrator to present on its means of managing the risk of pensions liberation, QROPS, data integrity scores and HMRC returns to give confidence and check that controls have been reviewed recently in the light of changes.

JLT | FUND | SECTION 11 – DC PRINCIPLES 31

DC Principles

Not

Applicable Not


Strongly Agree

Average Score

We have reviewed tPR guidance on the management of our DC fund/section AVC arrangements and are confident that we comply with the requirements.

0% 50% 0% 0% 50% 0% 2.00

We have reviewed our Lifestyle and Default investment options in the light of the pension reforms.

0% 50% 0% 0% 50% 0% 2.00

We are confident that our investment provider charges are within the 0.75% of Total Expense Ratio.

0% 50% 0% 0% 50% 0% 2.00

We regularly monitor the performance of our DC funds and have a clear policy on the review of providers.

50% 25% 0% 0% 25% 0% 1.00

We are aware of the new requirements applicable since April 2015 and we are complying with these.

0% 25% 0% 0% 75% 0% 3.00

0

1

2

3

4

5

We have reviewed tPR guidance on themanagement of our DC fund/sectionAVC arrangements and are confidentthat we comply with the requirements.

We have reviewed our Lifestyle andDefault investment options in the light of

the pension reforms.

We are confident that our investmentprovider charges are within the 0.75% of

Total Expense Ratio.

We regularly monitor the performance ofour DC funds and have a clear policy on

the review of providers.

We are aware of the new requirementsapplicable since April 2015 and we are

complying with these.

SECTION 11 – DC PRINCIPLES

JLT | FUND | SECTION 11 – DC PRINCIPLES 32

Additional comments

Observations

There seem to be contradictions in the responses. Some “not applicable” while others have responded. AVCs count as DC funds so charges and performance ought to be relevant There could be some misunderstanding about what is required in terms of monitoring AVCs.

Recommendations

The Group could consider reviewing its obligations in relation to DC AVCs and what it should be doing in the light of TPR guidance.

JLT | FUND | SECTION 12 – FUNDING, INVESTMENT AND COVENANT 33

Finding, Investment and Covenant

Not

Applicable Not


Strongly Agree

Average Score

We are aware of the requirement to have Statements of Investment Principles for DB and DC schemes and we have implemented and regularly review these.

0% 0% 0% 0% 50% 50% 4.50

We are aware of our responsibilities to Fund Members in de-risking activities.

0% 25% 0% 0% 50% 25% 3.25

We are aware of the Sponsor's financial health and ability to support the Fund.

0% 0% 0% 0% 75% 25% 4.25

The Group understands the concept of Investment Risk Management and has identified the Fund's Risks and is managing these.

0% 0% 0% 0% 100% 0% 4.00

The Group has identified factors that may have a detrimental impact on the Sponsors' ability to meet their obligations.

0% 0% 0% 0% 100% 0% 4.00

0

1

2

3

4

5

We are aware of the requirement to haveStatements of Investment Principles for

DB and DC schemes and we haveimplemented and regularly review these.

We are aware of our responsibilities toFund Members in de-risking activities.

We are aware of the Sponsor's financialhealth and ability to support the Fund.

The Group understands the concept ofInvestment Risk Management and has

identified the Fund's Risks and ismanaging these.

The Group has identified factors that mayhave a detrimental impact on the

Sponsors' ability to meet their obligations.

SECTION 12 – FUNDING, INVESTMENT AND COVENANT

JLT | FUND | SECTION 12 – FUNDING, INVESTMENT AND COVENANT 34

Additional comments

None

Observations

Very strong and confident responses.

Recommendations

None

JLT | FUND | SECTION 13 – REFLECTION OF THE PAST YEAR 35

In your opinion what has the Group done well in the past year? What has hampered the Group’s performance and what changes could be made to improve this going forward? I have only attended one meeting but the meeting was well structure and informed. There was agreed need for more regular meetings and review of the plan ahead which was

encouraging. Newly appointed member so limited knowledge .Responses are based on research and document review The Board have adequately reviewed and supported the Pension Fund Committee in the discharge of its duties despite two Board meetings having to be cancelled due to being

inquorate. Changes have been made to the size and membership of the Board that should reduce the likelihood of this happening again. Specific support and training has been undertaken on the new combined Pension Fund arrangements (Brunel) to ensure a smooth transition in 2019. The Dorset County Pension Fund continues to be well managed and is performing well.

Reviewing long term deficit & progress to reducing this. Basic training of board members. Failed to make an impression on the Pension Committee, or make headway on identification of trading costs. Whilst I have no specific evidence, former financial officers now board members appear to me, as an" outsider", to limit impartialness.

SECTION 13 – REFLECTION OF THE PAST YEAR

Whilst all reasonable care has been taken in the preparation of this document no liability is accepted under any circumstances by Jardine Lloyd Thompson for any loss or damage occurring as a result of reliance on any statement, opinion, or any error or omission contained herein. Any statement or opinion unless otherwise states should not be construed as independent research and reflects our understanding of current or proposed legislation and regulation which may change without notice. The content of this document should not be regarded as specific advice in relation to the matters addressed.

JLT Benefit Solutions Limited. Authorised and regulated by the Financial Conduct Authority. A member of the Jardine Lloyd Thompson Group. Registered office: The St Botolph Building, 138 Houndsditch, London EC3A 7AW. Registered in England No. 02240496. VAT No. 244 2321 96.

CONTACT

Jayne Pocock

Head of Pension Governance Services

Email: [email protected]

Tel: 0203 465 4956

mailto:[email protected]

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