Governance Guidance - Local Pension Boards

Local Pension Boards must be established by the 1 April 2015 under the provisions of section 5 of the Public Service Pensions Act 2013 and regulation 106 of the LGPS Regulations 2013 (as amended). To assist in the establishment of these Boards the Shadow Scheme Advisory Board (SSAB) has developed guidance on the creation and operation of Local Pension Boards for Administering Authorities.

It is anticipated that the guidance will be updated and modified by the SSAB as required in the future. It is also expected that the Statutory Scheme Advisory Board (once created) will adopt this guidance. If so, the guidance will fall under the provisions of section 7(3) of the Public Service Pension Act 2013 which requires that scheme managers (i.e. administering authorities) and Local Pension Boards must have regard to it.

This guidance does not supersede the requirements on Administering Authorities under legislation and in particular section 5 of the Public Service Pensions Act 2013 'Pension Board' and regulation 106 to 109 of the LGPS Regulations 2013 (as amended). It remains the responsibility of the Administering Authority to ensure all relevant legislation has been complied with in the creation and operation of the Local Pension Board.

In addition to the guidance the SSAB have devised a template terms of reference. This is designed to assist Administering Authorities as they formulate the terms of reference for their Local Pension Board. It must be read in conjunction with the guidance, the provisions of both the Public Service Pension Act 2013 and the LGPS Regulations 2013 noted in the previous paragraph.

A response to the Governance Guidance consultation is also available below, this document sets out an overview of responses to the consultation on a draft version of the guidance which took place in October and November 2014.

Local Pension Board Guidance

Selection of employer and member representatives to pension boards

Following a number of questions which have been raised around appointments to pension boards the attention of administering authorities is drawn to regulation 107(2) and the SSAB guidance sections 5.16 to 5.20.

In particular for both types of representative the sole regulatory criterion is the capacity to represent (employers or members). Although administering authorities when advertising for board members may wish to add other secondary criteria they should be aware of the potential for challenge should such criteria be used either to select for interview or appoint at the expense of capacity. In order to avoid the potential for challenge administering authorities are advised to be clear in any advert or information to prospective board members how capacity is to be assessed and how any secondary criteria are to be used in the process.

Questions and Answers

Template Terms of Reference for a Local Pension Board

Response to Guidance Consultation