Agenda and minutes

RESOLVED to appoint Councillor Bob Johnston as Chair for the ensuing Council year.

(Councillor Johnston in the Chair)

RESOLVED to appoint Councillor Kevin Bulmer as Deputy Chair for the ensuing Council year.

Apologies for absence were received from District Councillor Jo Robb.

To approve the minutes of the meeting held on 3 March 2023 and to receive information arising from them.

The minutes of the meeting held on 3 March 2023 were amended to include apologies for absence from Alastair Fitt and approved as a correct record.

10:20

A copy of the unconfirmed Minutes of the Local Pension Board, which met on 5 May 2023 is attached for information only.

10:25

The report sets out the items the Local Pension Board wishes to draw to the attention of this Committee following their last meeting in April 2023.

The  report set out the items the Local Pension Board wished to draw to the attention of this committee following their meeting in April 2023.

Alastair Bastin, a Local Pension Board Member presented the report and outlined the discussions and  recommendations regarding communication and engagement, improvements to performance reporting and the costs of managing the various investment portfolios,

RESOLVED to note the report of the Local Pension Board

10:30

This report will review progress against the key priorities set out in the Annual Business Plan for 2023/24, including an update on our work on the Stewardship Code, and the key issues from the latest Carbon Metrics report.

The Committee had before it a report setting out the latest progress against the key service priorities set out in the business plan for the Pension Fund for 2023/24 agreed at the March meeting.

The Service Manager for Pensions, Insurance and Money Management presented the report.  He referred, in particular, to the difficulty in assessing work required to address changes in Government regulations, recruitment to the vacancy for Governance Officer, an update on the application for the Stewardship Code. He said that a further report would be brought to the September meeting on the application and work on improved quarterly reporting on delivery of responsible investment responsibilities.

The Service Manager also reported on the on-going work within the Brunel Pension Partnership to develop a climate solutions portfolio focussed on investments within the area covered by the partnership funds.  A final decision to invest, which would be consistent with the target in the Climate Change Policy to increase investments in climate solutions was likely to be required before the next meeting of the Committee.

RESOLVED to

a)    note progress against each of the key service priorities as set out in the report

b)    agree any further actions to be taken to address those areas not currently on target to deliver the required objectives.

c)    delegate authority to the Head of Finance to make necessary arrangements regarding the new Fund

10:50

The Committee will be recommended to approve the latest Governance Policy for the Fund and note the latest position as set out against the Governance Compliance Statement.

The Committee had before it a report setting updates to the Governance Policy and Governance Compliance Statement which were last reviewed in 2019.

The Governance and Communications Team Leader presented the report and outlined the proposed changes.

RESOLVED to approve the revised draft Governance Policy and Governance Compliance Statement attached at Appendix 1 and 2 respectively.

11:00

The Committee will be recommended to approve the latest Regulatory Breaches Policy and agree any additional reporting requirements they wish to see covered in future reports.

The Committee had before it a report setting out proposed changes to the Breaches policy which was last reviewed in June 2019.

The Governance and Communications Team Lead presented the report and explained the proposed changes to the policy.

During discussion members considered the types of breaches that should be reported to the Committee in future and, in particular, whether systematic failures that could lead to breaches should be included.

RESOLVED to

a)    approve the revised draft Breaches Policy attached at Appendix 1.

b)    Agree that all known breaches should be reported to the Committee on a quarterly basis

c)    review the types of breaches to be reported at the December meeting when the Hymans Toolkit would be available for use by the Pension Fund

d)    ask the Director of Finance to submit a report on measures that could be taken to mitigate the risk of fraud and other financial crime which could impact upon the Pension Scheme

11:15

This report will present the latest position on the Fund’s risk register, including any new risks identified since the report to the last meeting. 

The Committee had before it a report setting out the latest risk register.

The Governance and Communications Team Leader presented the report and explained the issues affecting the risk scores and mitigation plans.

RESOLVED to:

a)    note the latest risk register and accept that the risk register covers all key risks to the achievement of their statutory responsibilities, and that the mitigation plans, where required, are appropriate. 

b)    endorse the request from the Fire Service for additional resource to support with work of the remedy workload and the ‘second options’ exercise for all on call fire fighters

11:25

This report updates the Committee on the key administration issues including service performance measurement, the debt recovery process and any write offs agreed in the last quarter. 

The Committee had before it a report providing an update on the key administration issues including service performance measurement, the debt recovery process and any write offs agreed in the last quarter.

The Pension Services Manager presented the report and answered a number of questions. She gave further information on the complaints received and data breaches being dealt with by the Information Management Team.

RESOLVED, 4 voting in favour and 1 abstention,  to:

a)    note the progress against the Administration objectives for the year;

b)    agree to the write off of

c)    ask the Director of Finance to provide additional information on monitoring of contributions in future reports

11:40

This report will cover an overview of the financial markets, the overall performance of the Fund’s investments against the Investment Strategy Statement and commentary on any issues related to the specific investment portfolios.  The report will update the Committee on the latest position regarding the changes to the Strategic Asset Allocation as discussed in their March meeting.  The report includes the quarterly investment performance monitoring report from Brunel.

The Committee had before it a report from the Independent Investment Adviser which provided an overview of the financial markets, the overall performance of the Fund’s investments against the Investment Strategy Statement and commentary on issues related to the specific investment portfolios.  The report also updated the Committee on the latest position regarding the changes to the Strategic Asset Allocation as discusses at the March meeting and the quarterly investment performance monitoring report from Brunel.

The Independent Investment Adviser presented the report an answered a number of questions.  He referred, in particular, to recent issues affecting the banking sector and the global financial position. 

The Service Manager (Pensions) presented to the Committee the report previously presented to the Climate Change Working Group (contained as an addenda item to the published Committee papers) setting out the options for re-allocating investments away from the current UK equity portfolio, including information on carbon intensity, green revenues and investment performance net of fees.

During discussion, members referred to the types of information they would wish to receive in the monitoring of investments and the changes required to the investment portfolio.

RESOLVED to:

a)    note the report

b)    agree the following changes in fund investments:-

(i)              a reduction in the allocation to UK equity to 20% of the total equity allocation, and ask Brunel to develop a suitable alternative to the current FTSE 100 benchmarked portfolio which better reflected the UK economy and which was more consistent with the Fund’s Climate Change Policy

(ii)            divestment from emerging markets portfolio

(iii)          invest the Funds released under i) and ii) above into the Sustainable Equities and Paris Aligned Benchmarked portfolios, such that both formed an equal weight of the total investments of the Fund

(iv)          no hedging