Monitoring COVID-19 mortality statistics

Club Vita has continued to monitor the COVID-19 mortality statistics this month. Despite some fluctuations due to the bank holiday at the end of May, the direction of travel remains positive, as both total deaths and those mentioning COVID-19 continue to trend downwards. Of course, it remains too early to see the effect of the recent easing of some of the lockdown restrictions. As such, we will all be keeping a close eye on the figures over the next few weeks.

We’ll be inviting Club Vita to our upcoming Keeping the LGPS Connected webinar on 18 June to discuss how COVID-19 may alter the longevity risk that public sector pension funds are exposed to. Do watch out for the invitation which will be issued soon with all the relevant details.

COVID-19 – unintended consequence of new legislation?

On 20^th May the Government published far-reaching reforms to UK insolvency through the emergency Corporate Insolvency and Governance Bill. The Bill aims to ensure that otherwise viable companies can survive the current pandemic situation – however, there are also consequences for LGPS funds. The Bill allows companies to enter into a “pre-insolvency” position, meaning statutory demands (e.g. for unpaid contributions) and winding-up petitions are prevented. As funds are already (in most cases) unsecured creditors, where debts are amongst the last to be paid, this prospect will make it even more difficult for funds to recover debts and by the time action can be taken, it may be too late. This unintended consequence, alongside the already increased focus on understanding employer covenant in the current environment, puts even more onus on funds to boost employer engagement, improve covenant information and consider pre-emptive action.

COVID-19 – managing net cash flow

LGPS funds face a number of challenges when it comes to managing their net cashflow position. With the added volatility that the COVID-19 outbreak brings, now more than ever, LGPS funds should be getting to grips with managing cashflow. Our 60 Second Summary explains why liquidity concerns have increased and what steps can be taken to mitigate the risk.

COVID 19 - communicating in a crisis

Effective communication requires advance planning to ensure messages are understood, especially in challenging, changing or uncertain times. Our Briefing Note provides a framework that can help you to understand your fund’s stakeholders and the role they play, and their specific communication requirements. We also outline some ‘top tips’ to help to achieve the best results if you are chairing or facilitating remote meetings.

Ongoing transfer concern during COVID-19 restrictions

As the current lockdown continues, concern remains over the payment of CETVs out of the LGPS at this time.  The risk remains that individuals desperate for cash could make poor decisions or fall victim of a scam.  While TPR acknowledge neither they nor funds can prevent an individual pursuing their right to a statutory transfer, they have updated their guidance on pension scams which funds should familiarise themselves with.  This is in addition to the TPR funding and investment guidance and its warning letter highlighting the risks associated with transferring pension rights during the pandemic.