Agenda item

(a)  That the Chief Executive, following consultation with the Leader of the Council and Commissioner for Children’s Services, be given delegated authority to agree the heads of terms of the pension arrangements, namely:

1.  Admission to the Berkshire LGPS Pension Fund (“the Fund”), should be on an open and not a closed basis, and;

2.  The Council will provide a Guarantee to the Fund in relation to the Trust meeting its liabilities under LGPS during the term of the Service Delivery Contract (“the Contract”), and;

3.  On transfer of the services back to the Council at the end of the Contract the Council will assume the Trust’s pension liabilities.

subject to the provisos and protections set out in Appendix B to the report.

(b)  That the significant concerns of the Cabinet about the potential future pension liabities on the transfer of services back to the Council be noted, and that Officers seek further assurance and safeguards from the DfE to minimise this risk.

The Strategic Director, Customer & Community Services introduced a report on the progress made on the transfer of some children’s services to an external organisation and sought approval for the pension arrangements.

Commissioners were updated on the current position in relation to the transition process and it was restated that the Council were committed to working with the Department for Education to deliver a safe transfer of services.  The new organisation had been incorporated on 12^th March 2015 as a private company, limited by guarantee with no share capital, and called Slough Children’s Services Trust Limited.  The Cabinet had delegated authority to the Chief Executive on 9^th March 2015 to agree the scope of services to be transferred, the majority of which had now been agreed as detailed in Appendix A to the report.  Given the scale and complexity of such a transition, the Council had expressed continued concerns about the proposed go live date of September 2015 and a significant number of substantive issues still needed to be resolved.  A further report would come to Cabinet in September on these matters.

The Cabinet was asked to delegate authority to the Chief Executive to agree the heads of terms of the pension arrangements on the basis that admission to the Berkshire LGPS Pension Fund be open and that at the end of the contract, the Council would assume the Trust’s pension liabilities.  Commissioners asked for clarification about the reasons for the scheme remaining open and the safeguards put in place about future pension liabilities arising from the decisions of the Trust.  It was recognised that access to the pension scheme had not been open during previous outsourcing processes; however, it was felt there were special circumstances to warrant a different approach and support the effective retention and recruitment staff given the return of services back to the Council at a future date.  The Pensions Heads of Terms circulated as Appendix B to the report were noted and these included a number of provisos and protections for the Council.

The delegation to the Chief Executive to finalise the pension arrangements was agreed, however, Commissioners expressed significant concerns about the risk of future unknown pension liabilities without adequate protection and it was therefore agreed that the concerns of the Cabinet be noted and that further safeguards be sought in negotiations prior to concluding the agreement.

A number of other issues were discussed including the recovery of costs of transition, contingency plans and the TUPE consultation, which was expected to commence during week commencing 27^th July.  Concern was expressed that the consultation period for staff would close only a short period before the transfer date and a Commissioner also asked whether an Equalities Impact Assessment had been carried out.  It was responded that an EIA would be conducted when the scope of services was finalised.

Resolved –

(a)  That the Chief Executive, following consultation with the Leader of the Council and Commissioner for Children’s Services, be given delegated authority to agree the heads of terms of the pension arrangements, namely:

1.  Admission to the Berkshire LGPS Pension Fund (“the Fund”), should be on an open and not a closed basis, and;

2.  The Council will provide a Guarantee to the Fund in relation to the Trust meeting its liabilities under LGPS during the term of the Service Delivery Contract (“the Contract”), and;

3.  On transfer of the services back to the Council at the end of the Contract the Council will assume the Trust’s pension liabilities.

subject to the provisos and protections set out in Appendix B to the report.

(b)  That the significant concerns of the Cabinet about the potential future pension liabilities on the transfer of services back to the Council be noted, and that Officers seek further assurance and safeguards from the DfE to minimise this risk.