Hymans Robertson’s National Knowledge Assessment has shown that understanding of topics that have traditionally been the focus of committees, such as investment and financial markets, is high amongst the LGPS, while knowledge of areas such as administration is lower. The pensions and financial services firm has advised that although overall scores were lower in these ‘non-traditional’ Pension Committee areas, individual fund results still showed a good spread of knowledge on all topics assessed. Collectively, informed decision-making and informed scrutiny was evident from participating funds – boding well for the continued governance of the scheme.

Overall, the assessment found high levels of knowledge across the LGPS with an average score of 67%*. Encouragingly it found that Chairperson results were typically much higher on all topics than the rest of the Committee and Pension Board members. They averaged a score of 72.7% compared to members with 66.3%.

The assessment was conducted to help Funds benchmark the knowledge and understanding of their Pension Committee and Pension Board members, in line with the expectation from the Pensions Regulator (TPR). The results echo those found in the 2018 National Confidence Assessment where there were high levels of confidence about traditional topics while other areas appeared to lag behind.

Catherine McFadyen, Head of LGPS consulting explains how funds could benefit from taking part:

“It’s really encouraging to see such high levels of knowledge demonstrated by Funds of all sizes. The expertise evidenced by Chairpersons in particular shows both leadership and commitment in this area. For Pension Committees and Boards in the LGPS, acquiring, developing and maintaining a good level of knowledge is key to carrying out their role effectively and ensuring the successful running of a fund. Having an understanding of where there are high levels of knowledge, and where the gaps lie, will be vital to ensuring this is done to the highest standards. 

“As we’d intended, the results of this survey have clearly shown the areas that Funds should focus on to develop more understanding. It is good to see that areas that are crucial to the successful running of the funds, such as investment and financial markets, have clearly been prioritised for learning. Yet, it is important that Pensions Boards and Committees don’t neglect other areas. They should ensure that training is continually maintained for all areas, including administration and actuarial matters.

“The last few years have been incredibly challenging for the public sector and a number of events have seen an increase in the scrutiny of public service pension schemes. This has reaffirmed that LGPS funds should evidence the training provided and the current knowledge and understanding levels retained within their Committee and Pension Board.

“The impact of COVID-19, will also have been felt deeply and so we are conscious that there is enormous pressure on Funds. Using these findings, Funds will be able to develop and evolve how their governance and training structure delivers the best standards for the scheme, acknowledging that training must be topical and engaging."