Agenda item

This report reviews the performance of the Capita Employee Benefits against the contract year during October 2015 – September 2016 and focuses on:

·         Re-enrolment Performance

·         Annual report on Capita’s Performance

·         Annual Benefits Statements

David Veale (the Council’s Director of HR and Organisational Development) introduced the report, which reviewed the performance during the contract year October 2015 – September 2016 of Capita Employee Benefits. This company provided pension administration services for Brent’s local government pension scheme. As the Pension Board had already heard, the Pension fund was managed separately. 

David Veale began by explaining that the LGPS was a contributory Career Average Revalued Earnings (CARE) Defined Benefit Scheme. He outlined that one of the significant issues with Capita’s administration of the Pensions Fund was that some of the 2015/16 data relating to the ‘CARE funding pots’ appeared to have not been included as part of data supplied to be analysed for the Triennial Review process. The Board heard that this was a troubling occurrence and that the Council had addressed this with Capita as a matter of real urgency and that significant steps were being taken to ensure that correct data was supplied.

David Veale also noted that another issue that had arisen was that 782 delayed Annual Benefit Statements (section 5.4 of the report) had not been sent out to active members by Capita, despite the agreed 30 November 2016 deadline, which was already late. There were also a number of Annual Benefit Statements, which had been sent out, which had inaccuracies, although these were in a minority. David Veale specified that the matter arising was that the Council would now have to contact The Pensions Regulator to state that there had been non-compliance in sending out the Annual Benefit Statements. With regards to the Scheme’s deferred members (employees who have left the Council), he noted that there was an additional problem whereby there were a high number of deferred members without a current address on either the Council’s or Capita’s records and therefore couldn’t be sent their Annual Benefit Statements. This was almost inevitable as it was the responsibility of the deferred member to inform the LGPS when they changed address and this regularly did not happen.  He again noted that the Council and Capita were exploring the potential actions to address this. David Veale concluded that an underlying issue was the performance issues around timeliness involving payments (section 4.3 of the report) and that the Council would be considering all of these issues before any discussions on contract renewal with Capita next year.

The Board acknowledged these performance problems with Capita and expressed its frustration at the errors which had been described. One Member of the Board offered their own anecdotal experience of their Annual Benefit Statement being issued with errors and Capita’s interface being more difficult for smaller employers to use. There were also discussions over Capita’s relocation of Brent’s Pension Administration from Surbiton to Darlington as being a key potential reason for the some of the mistakes being made. It was agreed that the most important point going forward would be how the Council continued to address these issues.

RESOLVED that:

(i)         In noting the report, the Board record its deep concern at the ongoing performance problems with Capita in administering Brent’s Pensions Fund;

(ii)        A report providing an update on Capita’s administration performance be provided at the next meeting of the Pension Board; and 

(iii)       Any review from The Pensions Regulator on these issues also be provided at a future meeting of the Pension Board.