Meetings

3.1     The Board considered the appointment of the Professional Independent Chair of the Pension Board. The appointment is for four years and the current Chair’s period of appointment will end in May 2020.

3.2     The Board considered its options including advertising for a new appointment or extending the current Chair’s appointment for a further four years.

3.3     Noting the current Chair’s performance the Board agreed to extend her for a further four year term.

Action point:

-     To notify the Clerk of the Pension Board of the Board decision to extend the current Chair’s appointment for a further four years.

6.1        The Board proposed changes to the Members’ Pension Scheme Rules following legal advice regarding potential age discrimination implications.

6.2        The Board agreed to consult on its proposals to amend the Pension Scheme Rules.

6.3        The closing date for the consultation would be 11 October 2019.

Action point:

The secretariat to :

-        issue and promote the consultation;

-        prepare a summary of the responses for the Board’s consideration at a future meeting

2.1        The Board considered recent legal advice regarding potential age discrimination implications arising from a number of provisions in the Assembly Member Pension Scheme.

2.2        As the Board is responsible for setting the rules of the Scheme, it agreed to undertake some changes to the rules ensure that they remained fit for purpose.

2.3        The Board also agreed to share its proposals with the Pension Board ahead of consulting with stakeholders on these changes later in the summer.

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3.1.      The Board considered the process for undertaking the cost cap valuation of the Assembly Members’ Pension Scheme.

3.2.      The Board agreed to monitor the situation.

Action point:

The secretariat to provide the Board with an update on the cost cap valuation in the new year.

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2.1. The Board noted the implication of the tapered Annual Allowance on the level of remuneration received.

2.2. Donna Davies, Head of Pensions at the Assembly, informed the Board that Ieuan Wyn Jones (Former Plaid Cymru Assembly Member) had been nominated as the one of the Member representatives on the Pension Board in place of Gareth Jones (former Plaid Cymru Assembly Member). The Board approved the nomination.

2.1 The Board considered the paper on the review of the Actuarial Valuation of the Assembly Members' Pension Scheme.

2.2 The Board confirmed they were content with the higher Commission contribution rate and agreed to inform the Scheme Actuary, who has sets the Commission contribution rate.

Action point:

The secretariat to inform the Scheme Actuary of the Board’s views.

5.1 The Board formally appointed the membership of the Pension Board for the Assembly Member Pension Scheme:

•        Jill Youds (Independent Chair) – from the start of the fifth Assembly

•        Gareth Jones (Former Plaid Cymru Assembly Member) – from the start of the fifth Assembly

•        Mike Hedges (Labour Assembly Member) – from the start of the fifth Assembly

•        Suzy Davies (Conservative Assembly Member and Assembly Commissioner)

•        Director of Finance, Assembly Commission (currently vacant, to be appointed).

5.2 The Board had some reservations regarding the appointment of an Assembly Commission employee on the Pension Board, in particular if there is a scenario where they have to make individual decisions about Assembly Members. The Board agreed to seek assurances from the Commission about this approach.

Action points:

•        Head of Pensions to formally notify the Assembly Commission of the Board’s appointment.

•        The Board agreed to write to the Assembly Commission Chief Executive and Clerk regarding the Assembly Commission’s representation on the Board.

6.1 The Board considered and agreed the roles and responsibilities as set out in the Memorandum of Understanding between the Board and the Pension Board

6.2 The Board noted that the new Pension Board would consider the document at its first meeting on 11 July. The document will also be counter-signed by the Chief Executive of the Assembly as Accounting Officer.

6.3 The Board agreed the demographic assumptions which will be used to set the employer cost cap for the Assembly Members’ pension scheme. The new Pension Board will consider the assumptions at its meeting on 11 July.

5.1        The Board considered a paper clarifying the roles and responsibilities in relation to the new Pension Scheme as a basis for a new Memorandum of Understanding (MoU) between the Pensions Board and the Remuneration Board.

5.2        The Board noted the roles and responsibilities and the Memorandum of Understanding and confirmed that it was satisfied with how the role of the Remuneration Board will be exercised in practice.

5.3        The Board agreed that the Government Actuary Department and the new Pension Board should be invited to comment on the MoU and roles and responsibilities.

5.4         The Board also noted that a paper on the cost cap valuations would be brought to the Board for consideration at its meeting in July.

4.1        The Board considered a paper outlining The Assembly Member Support Staff Pension Scheme presented by Donna Davies, Head of Pensions, Assembly Commission.

4.2        The Board noted that an Independent Financial Adviser (IFA) is aligned to the Scheme who is currently paid by commission for the services provided and the anticipated future costs for the service, given that it would no longer be operating on this basis.

4.3         The Board considered feedback from AMSS on this service and suggestions for improvement in the support they receive on understanding their pension scheme. 

4.4        The Board noted that the Assembly Commission would shortly conduct a review of the AMSS pension scheme.

4.5         The Board agreed that the contract for the current IFA should be terminated. Instead the Board agreed that the Pensions Team in the Assembly Commission should become the main point of contact for AMSS with queries about their pension.

4.6        The Board agreed that the Pensions team should write to members and their staff explaining the change and confirming the new arrangements.

Action point:

·         Head of Pensions to keep Board informed of progress in implementing the new provision for pensions advice to AMSS.

5.1        The Board considered an update on the work the Assembly Commission’s Pensions Team are doing to implement and communicate the 2016 changes to the Assembly Members’ Pension Scheme.

5.2        The Board discussed and agreed some outstanding issues for inclusion in the final draft of the pension scheme rules. The Board agreed a way forward and noted that final approval of the scheme will be sought from HMT early in the new year.

5.3        The Board noted that once the final scheme rules are approved by HMT, the Pensions Team will be writing to Members explaining the changes and how they affect them.

5.4        The Board discussed and agreed the approach to appointing the Chair of the new Pension Board and who should sit on the recruitment panel.

5.5        The Board agreed that Michael Redhouse would be its representative on the recruitment panel for the Chair of the new Pensions Board.

5.6        The Board noted the work the Commission’s Pensions Team is doing to review the support the Assembly Member’s Support staff are given to help them understand their choices regarding their pension. 

Actions:

·         Secretariat to contact external legal advisers to amend the draft pension scheme and subsequently seek formal approval from HMT.

·         Pensions Team to share with the Board the communications to Assembly Members on the new pension scheme.

·         The Secretariat to write to all those members affected by the Board’s decision on pension abatement (Rule of 80) explaining the reasons for the Board’s decision.

·         The Secretariat to draft a letter thanking the Board of Trustees for their valuable contribution to the development of the new pension scheme rules.

3.1 The Chair welcomed Donna Davies, Head of Pensions, Assembly Commission.

3.2 The Board considered an update on the implementation of the AM pension scheme.

Appointment of an independent chair and member nominated representatives to the Pension Board

3.3 The Board discussed the merits and cost implications of procuring a company to employ an independent Chair of the Board of Trustees, given the size of the pension scheme.

3.4 The Board agreed that the Independent Chair must demonstrate experience and have a background in pensions administration.

AMSS pension scheme – Independent Financial Adviser

3.5 The Board considered a paper on the AMSS pension scheme and the administrators’ recommendation to conduct a review of the scheme.

3.6 The Board agreed that the administrators should conduct a review of the existing provision for AMSS pension arrangements and whether they were fit for purpose.

Impact of salary differentiation on pension scheme

3.7 The Board considered a paper on the implications of salary differentiation on the AM pension scheme.

3.1 The Chair welcomed Donna Davies, Head of Pensions, Assembly Commission.

3.2 The Board noted how the pension scheme would be implemented by the administrators.

3.3 The Board noted the progress in preparing a new pension scheme for Assembly Members in the Fifth Assembly.

3.4 The Board agreed that a paper should be brought to the meeting on 3 July explaining in more detail the process for appointments to the Pensions Board

Action point:

·         AM pension administrators to return to the Board with an update on the implementation of the pension arrangements and appointments to the Pensions Board at the meeting on 3 July 2015.

3.1 The Board noted the progress in preparing a new pension scheme for Assembly Members in the Fifth Assembly.

3.2  The Chair thanked Mary Carter and Stuart Castledine whose input has been greatly valued in designing the new pension scheme for Assembly Members.

3.3  The Board considered the GAD Actuarial Valuation Report which the Pension Trustees had provided for information.

3.4 The Board agreed that it would like assurance that the scheme administrators were preparing for the implementation of the new pension scheme.

3.5 The Board noted comments raised by the Board of Trustees of the AM pension scheme.

3.6 The Board agreed that the section on transitional arrangements for office holders during dissolution of the Assembly should be removed from the Determination for Assembly Members 2015-16.

Action points:

• Write to Chair of the Board of Trustees requesting clarity on the process around the valuation of the pension scheme.
• Write to the Chair of the Board of Trustees responding to their comments on the latest draft of the pension scheme rules.
• Invite the administrators of the AM pension scheme to attend the next Board meeting to discuss the process to implement the pension scheme.

• Wragge & Co: Draft pension scheme rules – Paper 6

• Correspondence from the Chair of the Board of Trustees of the AM pension scheme – Paper 7

• GAD advice to the Trustees on the PSPA – Paper 8

5.1 The Chair welcomed Paul Carberry, Hannah Beacham and Kevin Milton to the meeting and invited them to introduce the new draft pension scheme rules for Assembly Members in the Fifth Assembly.

5.2 The Board discussed the new pension scheme rules and agreed to make amendments.

5.3 The Board will agree the pension scheme rules for inclusion in the consultation on the Determination for the Fifth Assembly in the spring term.

6.1 The Board discussed the make-up of a future Pension Board and the key aspects of the role of an Independent Chair.  

2.1 The Chair welcomed Paul Carberry and Kevin Milton from Wragge & Co to the meeting.

2.2 The Board considered each response to the consultation, which was issued in July 2014.

2.3 The Board noted the response from Welsh Liberal Democrats, which indicated that the Group were content with the Board’s proposals.

2.4 The Board considered comments from other respondents and agreed to respond to them individually.

2.5 Wragge & Co stated that they were ready to start preparing the draft scheme rules and that they could do so without further information from GAD on the level of employer cost cap.

2.6 The Board requested that Wragge & Co discuss the initial draft of the AM pension scheme with Mary and Stuart to inform the meeting on 28 November 2014.

2.7 The Board felt it was critical that there be a professional independent Chair of the board, in addition to the employer and employee reps. The Board agreed they would take responsibility for appointing the independent Chair – Wragge & Co advised that this could be built into the scheme rules.

2.8 There needs to be a clear definition of the roles and responsibilities of a pension board member.

2.9 It was noted that the Remuneration Board was the “responsible authority” for the purposes of PSPA.

2.10 The Board agreed to discuss employer representation with the Commission at the meeting in November. The Board agreed that it would be critical for the pension board members/Trustees of the scheme to have appropriate training for the role.

2.11 The Board agreed that the pension board should comprise of five members [2+2+1]

2.12 It was noted that the new pension board would replace the existing Board of Trustees. There would need to be a robust transfer of assets during the transition.

2.13 The Board agreed that the governance arrangements of the scheme would need to be transparent, fair and equitable to the public and Assembly Members.

Action points:

·         Staff to prepare responses to letters from the Labour Group and the AM pension Trustees addressing the points they raise. The letter should provide clarity on:

-       Provisions for Death in Service;

-       The Scheme Operation;

-       Details comparing the Board’s proposals for Acrual Rate with the scheme implemented by IPSA in Westminster (this must also be included in any communications strategy);

-       The Board’s stance on Additional Voluntary Contributions (AVCs); and

-       The contribution split.

·         Staff to contact HMT to discuss their view of how a light touch approach to the PSPA requirements could be implemented in practice and whether any changes have occurred following the Reform of Funded Public Body Pension Schemes. Depending on the outcome of the discussions, it might be necessary to arrange a meeting which would include the external Legal Advisers.

·         Staff to invite Stuart Castledine to attend the next AM representative group meeting.

·         In order to get a sense of how the contribution split in the proposed pension scheme would work in reality, the Board requested further information on the financial consequences of  ...  view the full minutes text for item 2