Agenda and minutes

To receive disclosures of personal interest from Members in accordance with the Code of Conduct

Note:

1.     Members are requested to identify the item number and subject matter that their interest relates to and signify the nature of the personal interest: and

2.   Where Members withdraw from a meeting as a consequence of the disclosure of a prejudicial interest they must notify the Chairman when they leave.

In accordance with the Council’s Code of Conduct, there were no declarations made pertaining to the agenda.

To receive the minutes of the previous meeting of the Pensions Fund Committee held on 13^th July 2021.

It was RESOLVED to approve the minutes of the 13^th July 2021 as an accurate reflection of the meeting. 

“That the press and public be excluded from the meeting under Section

100A(4) of the Local Government Act (as amended) for the following

agenda items of business - Items 4 on the grounds that it involves

the likely disclosure of the exempt information as defined in paragraph

14 of Part 4 of the Schedule 12A of the Act”.

RESOLVED:  Members RESOLVED “That the press and public be excluded from the meeting under Section 100A(4) of the Local Government Act (as amended) for the following item 9 of business on the grounds that it involves the likely disclosure of the exempt information as defined in paragraph 14 of Part 4 of the Schedule 12A of the Act”.

·         Responsible Investing – To receive a presentation from Baillie Gifford

Members received a presentation from representatives at Bailie Gifford.

Upon conclusion of the presentation members RESOLVED to note the update

The Director Finance and Digital Services set out the key issues being addressed as delegated functions, as specified in the Pension Fund Governance Policy Statement, by the Director of Finance and Digital Services.

Members were advised that during the quarter ended 30th June 2021, the overall value of the Fund increased from £4,493 million to £4,725 million.

The rolling 3 year performance of the Fund is 11.9% positive as compared to a benchmark of 8.7%. For the last quarter, Baillie Gifford, UK Credit and BlackRock Passive Equity outperformed their benchmarks; CBRE and BlackRock passive gilts performed in line with benchmark; and Global Growth and Global Opportunities underperformed their benchmark.

Baillie Gifford traditional equity portfolio outperformed their rolling 3 year rolling benchmark achieving a return of 18.1% against a benchmark of 8.1%.

Members were reminded that the March 2021 meeting of the Committee agreed to the revised asset allocation strategy for the Fund and the steps to be taken to move toward the preferred strategy together with the current allocation as was shown at 4.3 of the report.

Members were informed that with regard to infrastructure, it is proposed that the Fund invests over a number of years in order to secure and optimise opportunities across the different time periods.

The Chairman congratulated officers on the positive results in the report.

The Service Director Performance and Improvement then provided members with an update on the following areas:

At the end of July 2021, the Public Service Pensions and Judicial Officers Bill, dealing with the remedy for the ‘McCloud’ age discrimination, was laid before Parliament. The Bill includes retrospective measures and confirms the remedy period covering membership from the date of reform - 1 April 2014 to 31 March 2022 for eligible members. The Bill enables LGPS regulations to make provision for final salary benefits to be paid in respect of the remedy period. Draft LGPS regulations are expected by the end of 2021.  He added that they were currently working with employers on data collection, ahead of the regulations being finalised.  A Software provider was also being sought to update the system to anticipate the changes needed.

He continued that following recent ministerial changes, on the 19th September it was announced that the Ministry of Housing, Communities and Local Government (MHCLG) will become the Department for Levelling Up, Housing and Communities (DLUHC).

The Fund published all Annual Benefit Statements prior to the statutory deadline of the 31st August 2021. This exercise was shortly followed by the ‘Annual Allowance’ review with pension saving statements issued by the deadline of the 6th October 2021

A meeting of the Fund’s Communications Forum was held on 22nd July 2021. The main focus of discussion beyond the standard agenda items, included McCloud and the 2022 Valuation requirements.

Members were informed that data quality and compliance remains a key priority for the Pension Fund. Further to the previous update at Committee, the Fund has been working closely with the applicable Employers yet to implement the I-Connect monthly  ...  view the full minutes text for item 12.

The Service Director Performance and Improvement presented the report to members with information of the arrangements in place to manage the risk with the Pension Fund

He advised members that the risks had been broken down to 37 risks in total with one being in the high risk category which related to the financial Market suppressed by economic climate, national / global austerity measures and Brexit.

He added that there were two updates in the risk register for the investments category.  In relation to the risk regarding the Fund Manager; he advised members that a new control manager had been added regarding malpractices. He advised that a new risk had also been added regarding confidential and sensitive data.

A Member commented on the risk regarding Brexit and asked if there should be a time limit on this.

The Director Finance and Digital Services advised that it does not align with what has happened over the last 12-15 months, he added that it is still a risk that we are invested in the financial markets but their mitigations were that they were trying to diversify into fixed interest bonds.  He added that this was something that could be reviewed by the panel the next time they meet.

The Chairman added that it is a risk at the moment because of Brexit.  Payments were not accepted in Euros which could prove to be an issue and legislation could also change.

The Senior Accountant provided an update for members on the Wales Pension Partnership

She reminded members that the UK Government’s requirement for all pension funds to pool their investments has been progressing in Wales through the WPP.

The Partnership Governance arrangements included a JGC which meets 4 times a year. Each pension fund in Wales is represented on the Committee by their Chair or Vice Chair. 

She advised members that the last meeting of the JGC was held on the 22nd September 2021 with the following updates provided:

Work continuing to develop in a number of key areas:

·         2020/21 Annual Report;

·         Ministry of Housing, Communities and Local Government update;

·         Quarterly operator review with Link and Hymans Robertson;

·         Private Markets Allocator procurement process; and

·         Officer Working Group sub-groups:

·         Private Markets sub-group.

·         Responsible Investment sub-group.

·         Risk Register sub-group.

.

She informed the Committee that the next JGC meeting is scheduled to take place on 1st December 2021.

RESOLVED: Members noted the update

The Service Director Pensions, Procurement and Transactional Services updated Members on the Funding Strategy Statement and Administration Strategy governance documents which fall within the remit of the Committee as detailed in the terms of reference.

Following consideration by the Committee it was RESOLVED: to approve the  Funding Strategy Statement and Administration Strategy

To consider any urgent items as the Chairman feels appropriate

None received