To amend the admission agreement between Herefordshire Council, Hoople Ltd and Worcestershire County Council, which will inform the preparation of the 2018/19 financial statements, in relation to the pension deficit of previous council employees transferred to Hoople Ltd.  

Accounting for pension liabilities is a complex area and the council has sought independent expert advice in this area.

That:

(a)        the admission agreement between Herefordshire Council, Hoople Ltd and Worcestershire County Council (as administering authority to the Worcestershire County Council Pension Fund) be amended in relation to pension liabilities so that Herefordshire Council is liable to the Fund for pension liabilities directly (under the terms of the admission agreement) rather than Hoople Ltd being directly liable. The effect of this will be that a ‘flow through’ agreement is put in place in relation to Hoople Ltd’s pension liabilities.

1.              The alternative option is to not change the admission agreement; this report is to inform  on the impact of the admission agreement change.