Cost Management and Contributions

Priorities

Agreed top priority - Formalising the LGPS cost management methodology and performing a ‘dry run’ using 2013 valuation data which should include 2014 employers cap.
Agreed other priority - Determining the contribution bands and rates required to ensure a 6.5% yield in April 2014, still awaiting data from GAD, once received needs to be done ASAP.

Membership

* also sit on the Board

Cost Control Communications

In December 2014, the Shadow Scheme Advisory Board (SSAB) published two briefing notes in respect of the cost control processes which will be used to assess the costs of the reformed LGPS in England & Wales.

A briefing note for members and employers was published in order to:

• give a broad overview of the background to the cost control processes,
• outline the differences between the cost control processes and local funding valuations, and
• detail the possible impacts on the benefits structure and/ or employee contribution rates which could arise from the results of the cost control processes.

The SSAB ask that administering authorities make this briefing note accessible to fund employers and members so that they can familiarise themselves with the processes and the possible impacts that the cost control mechanisms could have on the Scheme benefits structure and/ or employee contribution rates.

A second briefing note was published for administering authorities in order to outline the role that LGPS pension funds will play in the cost control process and in particular focusses on the practicalities of delivering accurate and timely cost control figures.

In addition, the SSAB published a process map (located here) and a timetable (located here) setting out its plans for the interactions between the HM Treasury Employer Cost Cap (ECC) process and the Scheme Advisory Board Future Service Cost (FSC) process.

Any questions or queries arising from the publication of these documents should be referred to the Board secretariat in the first instance.

Please note that the briefing note for members and employers had minor amends made to it in February 2015 and the linked version above incorporates these changes.

Previous meetings