Agenda item

The Sub-Committee considered a report on the decision by the County Council to transfer Your Pension Service to One Connect Ltd (OCL), the County Council's Joint Venture with BT.  The transfer would be effective from 1 March 2013.

This decision had been taken because:

a)  There was a significant interaction and interdependence between Your Pension Service and other services already operated by OCL, in particular Payroll Services, ICT and Customer Access.

b)  Your Pension Service was a service that already operated in a highly commercial way and positioning the service within OCL would provide it with the necessary commercial support to continue to grow, for the ultimate benefit of the County Council and the Lancashire County Pension Fund as the key stakeholders.

A copy of the existing Service Level Agreement (SLA) with the Pension Fund Committee was presented.  The SLA set out very clear performance standards and requirements around containing the cost of administration and it was noted that the transfer of the Your Pension Service would not result in any changes to the SLA.

Reports on administration matters would continue to be presented to the Pension Fund Administration Sub-Committee.

Members commented on the excellent and cost effective service currently provided by Your Pension Service, and a number of reservations and concerns were expressed about the transfer of the service to OCL.  The following points were raised by members:

·  The high quality of the existing service to members and their families as set out in the Service Level Agreement must be maintained;

·  The expected expansion of the service on commercial lines must not put service standards at risk;

·  The price per member (currently £21.50) should remain in the lower quartile;

·  Confidential information concerning members and their families must at all times be secure;

·  The transfer of Your Pension Service had not been considered or approved by the Pension Fund Committee; and

·  There had not been any market testing prior to the transfer being approved.

In responding to the above, officers advised that the transfer would enable Your Pension Service to utilise OCL's commercial skills and systems to enhance and grow the business without affecting the current level of service. It was confirmed that the transfer of Your Pension Service had been market tested as part of the decision to include the transfer in the original list of council services to be transferred to OCL. 

The Sub-Committee noted these comments but felt that the reservations expressed by members particularly around the future integrity of the service should be brought to the attention of the Pension Fund Committee and that the Service Level Agreement should be amended to reflect the transfer arrangements and to provide necessary assurances on the future delivery of the service.

The Sub-Committee's attention was drawn to the Pension Fund's Communication Policy Statement that was attached at Appendix 'B' to the SLA.  It was noted that the Communication Policy Statement needed to be updated and that a further report would be presented to the Sub-Committee in July 2014.

Resolved: 

1.  That the County Council's decision to transfer Your Pension Service to Once Connect Ltd be noted.

2.  That the members' reservations and concerns about the transfer, as set out above, be brought to the attention of the Pension Fund Committee with a view to further assurances on the future delivery of the service being provided by OCL.

3.  That, subject to the amendments set out above, the current Service Level Agreement and associated performance standards, presented at Appendix 'A' to the report be confirmed.

4.  That an updated Communication Policy Statement be presented to the next meeting of the Sub-Committee.