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As Scheme Manager for the Essex Police Pension Scheme I would like to extend my thanks to all Board members who have assisted me in the management and administration of the Essex Police Pension Scheme. The Public Services Pensions Act 2013 and the Police Pension Regulations 2015 established the office of Chief Constable as the Scheme Manager. I am responsible for the management and administration of the Essex Police Pension Scheme and I am assisted in this task by the Essex Police Pension Board.
For public sector pension scheme regulation this is a developing area and the Board (similar to other Public Sector Boards) is evolving in what is an extremely complex area of pension regulation. I fully acknowledge the police pension arrangements are particularly complex with the 1987 Police Pension Scheme, The 2006 new Police Pension Scheme and as at 1st April 2015 the New Police Care Pension Scheme.
In this respect I would acknowledge the important and crucial role our Pension Administrator Essex County Council continues to play in helping myself as Scheme Manager with my statutory obligations. I would also like to acknowledge the role that Essex County Council Pension Administrator has played in assisting with collaborative training for Kent & Essex Police Pension Board members.
It gives me pleasure to endorse and support this training strategy for the Essex Police Pension Board.
Brian Harrington
Scheme Manager Essex Police Pension Authority
Under the Police Reform and Social Responsibility Act 2011 transferred the legal responsibility for ensuring the proper administration of police pensions to chief officers, as police pension authorities. This means that you we have responsibility for the administration of the scheme in respect of police officers in your force, with the specific exception that the responsibility for a chief officer’s own pension is the relevant Police and Crime Commissioner (PCC) as pension supervising authority. You will also be aware that reform of the police pension scheme will come into effect in April 2015.
The Public Service Pensions Act (the Act) 2013, the primary legislation under which the new police pension scheme is being developed, places more statutory emphasis on governance than has previously been the case in public service schemes. The police scheme, in common with the fire-fighter and local government pension schemes, will have statutory arrangements in place at national and local level. The Act prescribes a “Responsible Authority”: the Home Secretary will be responsible for making scheme regulations. She will do so in consultation with a “Scheme Advisory Board”: the Police Advisory Board for England and Wales is well-established and will perform this role.
The Chief Constable is designated “Scheme Manager” with the responsibility to administer the scheme according to scheme regulations in respect of your force. The Act stipulates that we should ensure compliance with scheme regulations, compliance with the requirements of The Pension Regulator and other matters as the regulations may specify. This will include matters such as record-keeping and publishing information. The Act also provides that we must be assisted in these matters by a Pension Board. The legislation does not prescribe the size of the board but does stipulate that there must be equal numbers of employer and scheme member representatives.
Under the Police Pension Regulations 2015 the Scheme Manager (Chief Constable) has established the Essex Police Pension Board comprising equal number of management and employee (Police Officer) representatives. The requirements of the board are to assist the Scheme manager to ensure proper management and administration of the Police Pension Schemes.
Develop and enhance standards of governance and administration of the Essex Police Pension Scheme.
Public Sector Pension Scheme governance and administration is an important aspect of public regulation. Our vision is to ensure we aspire to the highest standards of public sector pension scheme governance and administration.
All Board members support the Nolan principles of public life and the College of Policing Code of Ethics developed for the Policing sector.
Holders of public office should act solely in terms of the public interest.
Holders of public office must avoid placing themselves under any obligation to people or organisations that might try inappropriately to influence them in their work. They should not act or take decisions in order to gain financial or other material benefits for themselves, their family, or their friends. They must declare and resolve any interests and relationships.
Holders of public office must act and take decisions impartially, fairly and on merit, using the best evidence and without discrimination or bias.
Holders of public office are accountable to the public for their decisions and actions and must submit themselves to the scrutiny necessary to ensure this.
Holders of public office should act and take decisions in an open and transparent manner. Information should not be withheld from the public unless there are clear and lawful reasons for so doing.
Holders of public office should be truthful.
Holders of public office should exhibit these principles in their own behaviour. They should actively promote and robustly support the principles and be willing to challenge poor behaviour wherever it occurs.
The Public Services Pensions Act 2013, together with the Public Service Pensions Act 2014, introduces an expanded role for the Pension Regulator. This includes overseeing the major work-based pension schemes for those working in the public services throughout the UK. There expanded role includes regulating public service schemes in relation to the new governance and administration requirements introduced by those Acts.
1. Pension board members should understand their scheme rules and documented administration policies in enough detail to know where they are relevant to an issue and where a particular provision or policy may apply.
2. Pension board members should be aware of the range and extent of pension law which applies to public service pension schemes and have sufficient understanding of the content and effect of that law to recognise when and how it impacts on their responsibilities.
3. Schemes should assist individual pension board members to determine the degree of knowledge and understanding that is appropriate for the purpose of enabling the individual to exercise their functions. A pension board member’s knowledge and understanding should be sufficient for them to effectively carry out their role.
4. Pension board members should be able to challenge any failure to comply with the scheme rules and legislation relating to the governance and administration of the scheme and/or any failure to meet the standards and expectations set out in any relevant codes of practice issued by the regulator.
5. The roles and responsibilities of pension boards and their individual members will vary between pension schemes. Pension board members’ breadth of knowledge and understanding should be sufficient to allow them to understand fully any advice they are given. Pension board members should be able to challenge any information or advice they are given and understand how that information or advice impacts on any decision for which they are legally responsible.
6. Pension board members of funded pension schemes should ensure that they have the appropriate degree of knowledge and understanding of funding and investment governance matters relating to their scheme to enable them to effectively carry out their role.
There are several Codes of Practice issued by the Pension Regulator for the Public Services governance and administration including;
The new Police Pension Regulations 2015 under Part 3 Governance specifically require each scheme manager to
Police Pension Boards: establishment
15.—(1) The scheme manager must ensure that a pension board(c) (“a Police Pension Board”) is established to assist the scheme manager
(a) to secure compliance with—
(i) these Regulations;
(ii) any other legislation relating to the governance and administration of this scheme and any statutory pension scheme that is connected with it; and
(iii) any requirements imposed by the Pensions Regulator in relation to this scheme or any statutory pension scheme that is connected with it; and
(b) in the performance of the scheme manager’s functions under these Regulations.
(2) A Police Pension Board may be established to assist more than one scheme manager.
(3) If the Secretary of State is the scheme manager in relation to a member of a police force, the Secretary of State must identify an established Police Pension Board to assist the scheme manager.
(4) In paragraph (3), “established Police Pension Board” means a Police Pension Board which has been established to assist another scheme manager.
Scheme Manager
Essex Police Pension Board
Introduction
Established under the Police Pension Regulations 2015 (Regulation 15) to (a) to secure compliance with —
(i) These Regulations;
(ii) Any other legislation relating to the governance and administration of this scheme and any statutory pension scheme that is connected with it; and
(iii) Any requirements imposed by the Pensions Regulator in relation to this scheme or any statutory pension scheme that is connected with it; and
(b) In the performance of the scheme manager’s functions under these Regulations.
Approach B is to be adopted in respect of the establishment of a Police Pension Board for Essex Police .
As Chief Constable (Scheme Manager for Essex Police Pension Authority) I duly appoint Mr Mark Gilmartin (Director of Support Services) as Chair and Mr Mark Smith (Police Federation Joint Branch Board Chairman) as Deputy Chair of the Essex Police Pensions Board.
As Chair of the Essex Police Pension Board I duly appoint the following employee representatives;
As Chair of the Essex Police Pension Board I duly appoint the following employer representatives
A member of the pension board of a public service pension scheme must be conversant with:
a. The rules of the scheme, and
b. Any document recording policy about the administration of the scheme which is for the time being adopted in relation to the scheme.
A member of a pension board must have knowledge and understanding of:
a. The law relating to pensions, and
b. Any other matters which are prescribed in regulations.
The degree of knowledge and understanding required is that appropriate for the purposes of enabling the individual properly to exercise the functions of a member of the pension board19.
“19 Section 248A of the Pensions Act 2004 (as inserted by paragraph 19 of Schedule 4 of the 2013 Act)”
The legislative requirements about knowledge and understanding only apply to pension board members, but scheme managers should take account of this guidance as it will support them in understanding the legal framework and enable them to help pension board members to meet their legal obligations.
Schemes should establish and maintain policies and arrangements for the acquisition and retention of knowledge and understanding for their pension board members. Schemes should designate a person to take responsibility for ensuring that a framework is developed and implemented.
“19 Section 248A of the Pensions Act 2004 (as inserted by paragraph 19 of Schedule 4 of the 2013 Act)”
It is for individual pension board members to be satisfied that they have the appropriate degree of knowledge and understanding to enable them to properly exercise their functions as a member of the pension board.
Provide clarity about the areas of knowledge and understanding required for pension board members
Being ‘conversant’ means having a working knowledge (i.e. a sufficient level of familiarity) of the scheme rules (which for most public service pension schemes are set out in the scheme regulations) and documents recording policy about the administration of the scheme, so that pension board members can use them effectively when carrying out their duties.
Specific documents recording policy about the administration of the scheme will vary from scheme to scheme. However, the following are some examples of administration policies which the regulator considers to be particularly pertinent and would expect to be documented where applicable, and with which pension board members should therefore be conversant. This list is not exhaustive and other documented policies may fall into this category: Any scheme approved policies and procedures including documentation relating to:
For pension board members of funded pension schemes, documents which record policy about the administration of the scheme will include those relating to investment governance. For example, where relevant they should be familiar with the statement of investment principles and the funding strategy statement.
Pension board members should also be familiar with other types of documents and information related to the governance and administration of the scheme. For example, where relevant they should be familiar with: the register of interests
Where public service pension schemes offer DC/AVC options to their members, pension board members should also be familiar with the requirements for the payment of member contributions to DC/AVC providers, the principles relating to the operation of DC/AVC arrangements, the choice of investments to be offered to members, the providers’ investment and fund performance report and the payment schedule for DC/AVC arrangements.
Schemes should prepare and keep an updated list of the documents with which they consider pension board members need to be conversant to effectively carry out their role and make sure that both the list and the documents are accessible
Pension board members should understand their scheme rules and documented administration policies in enough detail to know where they are relevant to an issue and where a particular provision or policy may apply.
Pension board members should be aware of the range and extent of pension law which applies to public service pension schemes and have sufficient understanding of the content and effect of that law to recognise when and how it impacts on their responsibilities.
Schemes should assist individual pension board members to determine the degree of knowledge and understanding that is appropriate for the purpose of enabling the individual to exercise their functions. A pension board member’s knowledge and understanding should be sufficient for them to effectively carry out their role.
Pension board members should be able to challenge any failure to comply with the scheme rules and legislation relating to the governance and administration of the scheme and/or any failure to meet the standards and expectations set out in any relevant codes of practice issued by the regulator.
The roles and responsibilities of pension boards and their individual members will vary between pension schemes. Pension board members’ breadth of knowledge and understanding should be sufficient to allow them to understand fully any advice they are given. Pension board members should be able to challenge any information or advice they are given and understand how that information or advice impacts on any decision for which they are legally responsible.
Pension board members of funded pension schemes should ensure that they have the appropriate degree of knowledge and understanding of funding and investment governance matters relating to their scheme to enable them to effectively carry out their role.
The training implementation plan involves a holistic and blended approach to learning using Continuous Professional Development, Knowledge Skills and Understanding releases, Pension Administrator bespoke training interventions and The Pension Regulator Public Sector tool kit.
Each Board Member is expected to take responsibility for being committed to the principle of Continuous Professional Development. To ensure on a regular basis, responsibility and commitment is taken for using opportunities to increase learning around key pension governance and administration issues i.e.; Scheme rules, Scheme administration policies, Practical guidance and standards set in the Pension Regulator Codes of Practice.
The Head of Pension Governance & Compliance issues key documentation around the above for each Pension Board meeting. These to date have included the following;
Code of Practice No 14 Governance and administration of Public Service Pension Schemes
The Pension Regulator – Public Service Pension Schemes – A summary of Governance and Administration
ACPO draft Guidance on the creation and operation of Police Pension Boards in England
Briefing paper from Head of Pensions containing Home office guidance on creation of Police Pension Boards
Briefing extract from Code of Practice No 14 – Knowledge, skills and competence of Board Members
Briefing extract from Code of Practice No 14 – Conflict of Interest.
Briefing extract from Code of Practice No 14 – Administration
Briefing extract from Code of Practice No 14 – Information to be published about scheme.
Copy of Draft Police Pension Regulations New CARE Scheme 2015
Copy of Police Pension Regulations 1987. (PPS)
Copy of Police Pension Regulations 2006 (NPPS)
Reasonable Periods Internal Disputes Procedure – Code of Practice No 11.
Scheme Members Guide 1987 Police Pension Scheme
Scheme Members Guide 2006 Police Pension Scheme
Scheme Members Guide 2015 Police CARE Scheme.
Administration Guide 2015 Police CARE Scheme
Home Office Circular 24/13
Home Office Design Reform Framework
Pension Regulator Code of Practice No 14 Public Sector Scheme Governance and Administration
The Police Pension Regulations 2015.
Regular PSAB updates
The Pension Regulator offers excellent educational and learning facilities and all Board Members are advised to ensure they acquaint themselves with the Pension Regulator website and use their open e learning tool kits. The e.learning forms part of the mandatory requirement for Board members and is monitored through the internal controls risk framework.
Our online Public Service toolkit programme is split into seven separate courses designed to enable you to dip in and out of the content, and learn at your own pace. All of the learning is downloadable, which means that you can also study offline.
Each course features a variety of activities to suit the way you want to learn. This includes:
Pension board members of public service schemes (as defined in section 318 of the Pensions Act 2004) should complete our free Public Service toolkit, unless they arrange the equivalent learning. You must log in or sign up to use the Public Service toolkit.
The courses cover the governance and administration of public service schemes, as described in the public service code of practice.
Learn what conflicts of interest are, how important it is to be aware of them and their potential impact. You will also find out how to manage conflicts.
Learn how to identify, evaluate, manage and monitor scheme risks. You will also learn about internal controls used to mitigate risk.
Learn about the requirements for maintaining complete and accurate member data. You will also learn about other records that must be kept.
Learn about the requirement to monitor member contributions and how to manage overdue contributions.
Learn about the information that public service schemes are required to provide to members.
Learn about the requirement for schemes to have an internal dispute resolution procedure (IDRP).
Learn about who must report breaches, deciding when to report a breach and how to submit a report.
A bespoke training event was held on 24th September 2015 for Board Members covering the following topics;
Following the implementation of the above an evaluation will be undertaken with Board members. The following skills matrix will be used to monitor and evaluate.
Guidance for trustees
February 2018
Sample board skills matrix
This example board matrix will help you record the skills, knowledge, understanding and experience of the whole trustee board. It is not intended to be an exhaustive list of matters you should consider, and the skills required will vary depending on the size and complexity of your scheme.
You should base your skills matrix on the objectives you’ve agreed in your business plan and think about the knowledge, skills and competencies your board will need to achieve them. You should also consider any upcoming exercises or projects which may require additional skills and experience, for example preparing for a change in law or a change in service provider.
Once you have identified the skills and experience you need, you should prioritise those which are essential for your board to effectively manage the scheme over the next year. You should also identify which are critical, which will help mitigate risks, which are essential for all trustees to meet and how others may be achieved by the collective board.
The trustees should assess themselves against the skills in this matrix to identify gaps, which can be addressed either through training, using advisers or gaining experience and expertise from a provider or employer in an advisory role. For example, you may consider inviting non-trustees from the business with a specific skill or experience to sit on a sub-committee, or appoint an adviser to work with you on a specific project for a limited period of time.
Key: Excellent, Good, Some, Limited, None
Select the skills required and at what level for each trustee by ticking the relevant box using the key above as a guide: