Agenda and decisions

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Contact: Julie Dean  Tel: 07393 001089; E-Mail:  julie.dean@oxfordshire.gov.uk

Items
No. Item

1.

Apologies for Absence and Temporary Appointments

Decision:

Apologies were received from Anya Greig (Beneficiaries Observer), Cllr Mark Lygo, Cllr Alan Thompson and Cllr Lawrie Stratford

2.

Declarations of Interest - see guidance note

Decision:

There were no declarations of interest submitted.

3.

Minutes pdf icon PDF 198 KB

To approve the minutes of the meeting held on  7 December 2018 (PF3) and to receive information arising from them.

Decision:

Approved and signed subject to an amendment (on Addenda).

 

No Matters Arising.

4.

Petitions and Public Address

Decision:

No requests to address the meeting or to submit a petition were approved – requestees were advised to address the next meeting when an appropriate  substantive item was scheduled to be on the Agenda.

5.

Minutes of the Local Pension Board and the Oversight Board pdf icon PDF 146 KB

10:05

 

A copy of the unconfirmed Minutes of the Local Pension Board, which met on 18 January 2019, is attached for information only (PF5).

 

Also attached is a copy of the approved 1 November 2018 Minutes of the Brunel Oversight Board, again for information only (PF5).

 

Additional documents:

Decision:

Noted.

 

Noted.

6.

Report of the Local Pension Board pdf icon PDF 143 KB

10:10

 

In response to a request from the Chairman of Penson Fund Committee to have a dedicated item on each Committee agenda for the work of the Local Pension Board, attached at PF6 is the report by the Independent Chairman of the Local Pension Board. It invites the Committee to respond to the key issues raised by the Pension Board at its most recent meeting on 18 January 2019.

 

The Committee is RECOMMENDED to note the Report of the Board and:

 

(a)  note the comments of the Board in respect of the actions being taken to ensure that the Pensions Administration Team have adequate and appropriate resources to deliver the agreed implementation plan;

(b)  consider its request that all key reports in respect of the 2019 Valuation are submitted to the Board for their comments as appropriate; and

(c)  note its comments on the risk register and the investment in the low carbon portfolio and to consider this further on the separate item on the risk register elsewhere on this agenda.

 

 

 

Decision:

(a)  noted;

(b)  agreed;

(c)  to consider the Board’s comments at the Risk Register item later on in the Agenda.

7.

Improvement Plan pdf icon PDF 470 KB

10:20

 

The attached report (PF7) updates the Committee on progress against the objectives and milestones set out in the Improvement Plan.

 

The Committee is RECOMMENDED to note the latest position with regard to the implementation of the Improvement Plan.

Additional documents:

Decision:

Noted.

 

The Committee requested Mr Collins to produce a Breaches Log to accord with the Committee’s Breaches Policy, for each meeting of the Committee and the Board. In addition, that officers send any correspondence received from the Scheme Advisory Board or the Pensions Regulator as soon as possible to members of the Committee and the Board.

8.

Review of the Annual Business Plan 2018-19 and Approval of Annual Business Plan 2019-20 pdf icon PDF 264 KB

10:45

 

The report (PF8) covers the Business Plan for the Pension Fund Committee for the forthcoming financial year and includes the key objectives for the forthcoming year, the proposed Budget and the Cash Management Strategy. Progress against the objectives set for the current financial year is also set out to provide the context for the forthcoming year.

 

The Committee is RECOMMENDED to:

 

(a)  approve the Business Plan and Budget for 2019/20 as set out at Annex 1;

(b)  approve the Pension Fund Cash Management Strategy for 2019/20;

(c)  delegate authority to the Director of Finance to make changes necessary to the Pension Fund Cash Management Strategy during the year, in line with changes to the County Council’s Treasury Management Strategy;

(d)  delegate authority to the Director of Finance to open separate pension fund bank, deposit and investment accounts as appropriate; and

(e)  delegate authority to the Director of Finance to borrow money for the pension fund in accordance with the regulations.

 

 

Additional documents:

Decision:

(a)  approved;

(b)  approved;

(c)  agreed;

(d)  agreed;

(e)  agreed; and

(f)   note the intention of Mr Collins to bring to the next meeting in June, an update on the current work ongoing within Brunel on ESG decision making.

 

Mr Collins undertook, at the request of the Committee, to make available to members of the Committee a breakdown of fees, manager by manager, at Brunel level. He also agreed to supply ,separately, those which relate to the Managers overseen by this Committee.

9.

Risk Register pdf icon PDF 127 KB

11:00

 

The report (PF9) presents the latest position on the Fund’s Risk Register, including any new risks identified since the report to the last meeting.

 

The Committee is RECOMMENDED to note the comments of the Pension Board and determine any changes it wishes to see made to the Risk Register.

Additional documents:

Decision:

(a)  to note the Risk Register; and

(b)  to note the recommendation from the Local Pension Board and to inform the Board of its decision not to include a separate line for Climate Change, for the reason that the term ESG incorporated a much wider range of other issues not specifically related to climate change. However, to assure the Board that this issue would be monitored carefully and the would be revisited if the situation changed and intervention was required.

10.

Administration Report pdf icon PDF 182 KB

11:05

 

The Committee is updated (PF10) on those administration issues not covered under the Improvement Plan.

 

The Committee is RECOMMENDED to note the report, including the payment of £3,100 compensation following a stage 2 determination under the Adjudication of Disagreements Procedure.

Decision:

Noted.

11.

Government Consultations pdf icon PDF 177 KB

11:10

 

Attached at PF11 is a report which updates the Committee on recent government consultations and regulation changes and invites the Committee to approve responses to consultations on pooling guidance and pension protections on out sourcing.

 

The Committee is RECOMMENDED to:

 

(a)   approve the consultation response in respect of pooling guidance as contained in Annex 1;

(b)  approve the consultation response in respect of pension protection as contained in Annex 2;

(c)  note the changes introduced under the LGPS (Miscellaneous Amendment) Regulations 2018, and ask for a further report on the implications once the process and costs become clearer; and

(d)  note the position in respect of the cost capping mechanism and consider it further as part of the 2019 Valuation process.

 

 

Additional documents:

Decision:

(a)  approved;

(b)  approved;

(c)  noted; and

(d)  noted.

12.

Overview of Past and Current Investment Position pdf icon PDF 178 KB

11:20

 

Tables 1 to 4 are compiled from the custodian's records. The custodian is the Pension Fund's prime record keeper. He accrues for dividends and recoverable overseas tax within his valuation figures and may also use different exchange rates and pricing sources compared with the fund managers. The custodian also treats dividend scrip issues as purchases which the fund managers may not do. This may mean that there are minor differences between the tabled figures and those supplied by the managers.

 

The Independent Financial Adviser will review the investment activity during the past quarter and present an overview of the Fund’s position as at 31 December 2018 using the following tables:

 

Table 1

provides a consolidated valuation of the Pension Fund at 31 December 2018

Table 2

shows net investments/disinvestments during the quarter

Table 3

provides investment performance for the consolidated Pension Fund for the quarter ended 31 December 2018

Table 4

provide details of the Pension Fund’s top holdings

 

In addition to the above tables, the performance of the Fund Manager has been produced graphically as follows:

 

Graph 1 – Market value of the Fund over the last three years

Graphs 2-7 – Performance of the Fund Managers attending Committee to the quarter ended 31 December 2018

 

The Committee is RECOMMENDED to receive the tables and graphs, and that the information contained in them be borne in mind, insofar as they relate to items 15, 16, 17, 18 and 19 on the agenda.

 

Decision:

Received.

13.

EXEMPT ITEMS

The Committee is RECOMMENDED that the public be excluded for the duration of items 14, 15, 16, 17, 18, and 19 in the Agenda since it is likely that if they were present during those items there would be disclosure of exempt information as defined in Part I of Schedule 12A to the Local Government Act 1972 (as amended) and specified in relation to the respective items in the Agenda and since it is considered that, in all the circumstances of each case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

 

THE REPORTS RELATING TO THE EXEMPT ITEMS HAVE NOT BEEN MADE PUBLIC AND SHOULD BE REGARDED AS STRICTLY PRIVATE TO MEMBERS AND OFFICERS ENTITLED TO RECEIVE THEM.

 

NOTE: In the case of items 16 and 17, there are no reports circulated with the Agenda. Any exempt information will be reported orally.

Decision:

Agreed.

14.

Exempt Minutes

11:25

 

To note the exempt Minute of the Local Pension Board meeting held on 18 January 2018 (PF14).

 

The public should be excluded during this item because its discussion in public would be likely to lead to the disclosure to members of the public present of information in the following prescribed category:

 

3.         Information relating to the financial or business affairs of any particular person (including the authority holding that information) and since it is considered that, in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information, in that such disclosure would distort the proper process of free negotiations with another party.

 

Decision:

Noted.

15.

Overview and Outlook for Investment Markets pdf icon PDF 336 KB

11:25

 

The report (PF15) sets out an overview of the current and future investment scene and market developments across various regions and sectors. It provides the context for consideration of the reports from the Fund Managers. The report itself does not contain exempt information and is available to the public. The Independent Financial Adviser will also report orally and any information reported orally will be exempt information.

 

The public should be excluded during this item because its discussion in public would be likely to lead to the disclosure to members of the public present of information in the following prescribed category:

 

3.         Information relating to the financial or business affairs of any particular person (including the authority holding that information) and since it is considered that, in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information, in that such disclosure would prejudice the trading activities of the fund managers involved and would prejudice the position of the authority's investments in funding the Pension Fund.

 

The Committee is RECOMMENDED to receive the report, tables and graphs, to receive the oral report, to consider any further action arising on them and to bear the Independent Financial Adviser’s conclusions in mind when considering the Fund Managers’ reports.

Decision:

Received.

16.

UBS Group

11:35

 

(1)          The Independent Financial Adviser will report orally on the performance and strategy of UBS drawing on the tables at Agenda Items 12 and 15.

 

(2)          The representatives (Malcolm Gordon and Anthony Sander) of the Fund Manager will:

 

(a)       report and review the present investments of their part of the Fund and their strategy against the background of the current investment scene for the period which ended on 31 December 2018;

 

(b)       give their views on the future investment scene.

 

In support of the above is their report for the period to 31 December 2018.

 

At the end of the presentation, members are invited to question and comment and the Fund Managers to respond.

 

The public should be excluded during this item because its discussion in public would be likely to lead to the disclosure to members of the public present of information in the following prescribed category:

 

3.         Information relating to the financial or business affairs of any particular person (including the authority holding that information) and since it is considered that, in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information, in that such disclosure would prejudice the trading activities of the fund managers involved and would prejudice the position of the authority's investments in funding the Pension Fund.

 

The Committee is RECOMMENDED to note the main issues arising from the presentation and to take any necessary action, if required.

Decision:

Noted.

17.

Wellington

12:15

 

(1)          The Independent Financial Adviser will report orally on the performance and strategy of Wellington drawing on the tables at Agenda Items 12 and 15.

 

(2)          The representatives (Nicola Staunton, Ian Link and Louise Kooy-Henckel) of the Fund Manager will:

 

(a)       report and review the present investments of their part of the Fund and their strategy against the background of the current investment scene for the period which ended on 31 December 2018;

 

(b)           give their views on the future investment scene.

 

In support of the above is their report for the period to 31 December 2018.

 

At the end of the presentation, members are invited to question and comment and the Fund Managers to respond.

 

The public should be excluded during this item because its discussion in public would be likely to lead to the disclosure to members of the public present of information in the following prescribed category:

 

3.         Information relating to the financial or business affairs of any particular person (including the authority holding that information) and since it is considered that, in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information, in that such disclosure would prejudice the trading activities of the fund managers involved and would prejudice the position of the authority's investments in funding the Pension Fund.

 

The Committee is RECOMMENDED to note the main issues arising from the presentation and to take any necessary action, if required.

Decision:

Noted.

18.

Report of Main Issues arising from Reports of the Fund Managers not represented at this meeting

12:55

 

The Independent Financial Adviser will report orally on the officer meetings with Adams Street, Insight and Legal & General in conjunction with information contained in the tables (Agenda Item 12).

 

The public should be excluded during this item because its discussion in public would be likely to lead to the disclosure to members of the public present of information in the following prescribed category:

 

3.         Information relating to the financial or business affairs of any particular person (including the authority holding that information) and since it is considered that, in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information, in that such disclosure would prejudice the trading activities of the fund managers involved and would prejudice the position of the authority's investments in funding the Pension Fund.

 

The Committee is RECOMMENDED to note the main issues arising from the reports and to take any necessary action, if required.

Decision:

(a)  noted;

(b)  With regard to a concern raised by the officers, to request the Director of Finance, following consultation with the Chairman, Deputy Chairman and Opposition Group Spokesperson to take action, following investigation if it is deemed necessary; and

(c)  as a result of this process, to request Mr Collins to bring a report back to Committee and, if deemed necessary, to write to members of the Committee to glean any other concerns, and, should there be more, to include these into the above-mentioned report, for decision.

19.

Summary by the Independent Financial Adviser

13:00

 

The Independent Financial Adviser will, if necessary, summarise any issues arising from the previous discussions and answer any questions from members.

 

The public should be excluded during this item because its discussion in public would be likely to lead to the disclosure to members of the public present of information in the following prescribed category:

 

3.         Information relating to the financial or business affairs of any particular person (including the authority holding that information) and since it is considered that, in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information, in that such disclosure would prejudice the trading activities of the fund managers involved and would prejudice the position of the authority's investments in funding the Pension Fund. 

Decision:

The Independent Financial Adviser had no further issues to add.

20.

Corporate Governance (Voting Review) pdf icon PDF 158 KB

13:05

 

This report (PF20) provides information on the voting records of the Fund Managers, which have been exercised on behalf of this Fund.

 

The Committee is RECOMMENDED to:

 

(a)  note the Fund’s voting activities; and

(b)  determine any issues it wishes to follow up with the specific fund managers, or in general.

Additional documents:

Decision:

Noted.

21.

Corporate Governance and Socially Responsible Investment pdf icon PDF 1 MB

13:15

 

This item will provide the opportunity to raise any issues concerning Corporate Governance and Socially Responsible Investment which need to be brought to the attention of the Committee.

Decision:

It was AGREED that Mr Collins would send out the following written statement (please see below) to members of the public who wished to challenge the Committee on its policy in respect of corporate governance and socially responsible investment.

 

The Committee also noted the piece contained in the 2018 Quarterly Engagement report of the Local Authority Pension Fund Forum (LAPFF) which referred to corporate governance and socially responsible investment (included on the Addenda to the meeting).

22.

Annual Pension Forum

13:15

 

The officers will report on the Annual Pension Forum which took place on 11 January 2019.

Decision:

There were no issues to report.