Half of public sector pension boards meet fewer than four times a year

In its recently published commentary on its ‘Public service governance and administration survey 2018’, the watchdog stressed that it expects scheme governing bodies to meet at least quarterly.

TPR expressed its concern that irregular meetings may be an indicator of poorly governed schemes.

“We note that fire schemes had both infrequent meetings and were the most likely cohort to postpone meetings,” the report stated, adding that the regulator expects to see an improvement in this area.

A TPR spokesperson declined to name the recalcitrant schemes.

Jane Kola, a partner at Arc Pensions Law, said regular contact is at the core of being a good board. 

She said: “How many times a board meets depends on the scheme’s circumstances, but as a rule of thumb the more risk a scheme is taking to deliver benefits to members, the more work is needed to keep things on track.” 

Faith Dickson, partner at Sackers, agreed. She said that – generally – four meetings a year is a good rule of thumb, but “it could be more or fewer depending on what business the board needs to consider, and how much is done by committees, and how much is fed back to trustees by other means in-between meetings”.

Ms Dickson pointed out that “good communication between meetings, scheduling meetings with sufficient notice and sticking to scheduled times for meetings is, in my view, more important than fixing on a particular number”.

Vassos Vassou, senior trustee representative at Dalriada Trustees, said the regulator is right to advise that scheme governing bodies meet quarterly, if not more often.

Trustees or pension board members who frequently attend board meetings are better placed to make timely decisions, he said.

“Those who meet less are more likely to miss important opportunities. Schemes who host irregular meetings often find that they gradually let go of the reins, which leads to schemes being run by their advisers instead,” he said.  

Public service pension schemes do not have trustee boards. Instead they have pension boards to provide advice and assurance to the scheme manager, who has overall responsibility for the pension fund.

The regulator said in its survey commentary that it had significant concerns about 11 schemes that reported that at the time they completed the survey they were operating with fewer pension board members than required by their respective scheme regulations.

Although the situation was temporary in most cases until new pension board members could be recruited, TPR said these schemes were breaching the law.

“We urge scheme managers to maintain a pension board with more than the minimum number of members to avoid this situation,” the regulator said.

The regulator also urged schemes to take steps to ensure pension board members are recruited before a vacancy exists to enable an effective handover to take place.