Meeting documents
Pension Fund Committee
Friday, 23 May 2003
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To Members of the Pension Fund Committee Notice of Meeting
MembershipChairman – Councillor C.H. Shouler Councillors:
Co-opted Members:
The
agenda follows. Decisions taken at the meeting will become effective at
the end of the working day on 3 June 2003
unless
called in by that date for review by the appropriate Scrutiny Committee. AGENDA
To approve the minutes of the meetings held on 21 February 2003 (PF3(a)) and 17 April 2003 (PF3(b)) and to receive for information any matters arising therefrom. To receive the Minutes of the Pension Fund Manager (Appointments) Sub-Committee held on 4, 10, 15, 16 and 17 April 2003 (PF3(c)).
10:05 The
Financial Adviser will review the investment activity during the past
quarter and present an overview of the fund’s position as at 31 March
2003 using the following charts:- Charts 5 to 10 - focus on investment performance during the quarter and for 1, 3 and 5 years; Charts 11 to 12 - provide information on UK equity sector distribution for both the Fund Managers, Deutsche Asset Management and Schroders. Charts 13 to 14 - show UK equity sector returns for the quarter and year end to 31 March 2003. The spreadsheets included as tables 1 to 7 provide the detailed figures in support of the above charts. The Committee is RECOMMENDED to receive the charts and tables, and that the information contained in them be borne in mind insofar as they relate to items 7E to 8E in the Agenda. EXEMPT ITEMS The Sub-Committee will be invited to resolve to exclude the public for the consideration of the following exempt items (marked E) by passing a resolution in relation to each such item in the following terms: "that the public be excluded during the consideration of the following items in the Agenda since it is likely that if they were present during those items there would be a disclosure of "exempt" information as described in Part I of Schedule 12A to the Local Government Act, 1972 and specified below each item in the Agenda." Note: In the case of items 7E - 8E there are no reports circulated with the Agenda. Any exempt information will be reported orally. The Fund Managers’ reports relating to the Exempt Items at 7E and 8E and any information to be reported orally have not been made public and should be regarded as strictly private to members and officers entitled to receive them until after 23 August 2003.
10:20 The Independent Financial Adviser will report orally, giving an overview of the current and future investment scene and market developments across various regions and sectors. His oral report and the report (PF6E), which is not exempt, will be supported by relevant charts of economic and market trends, where appropriate, which are attached. Any exempt information will be reported orally. (Information Exempt in that it relates to the financial or business affairs of any particular person (other than the authority).) The Committee are RECOMMENDED to receive the oral report and charts, to consider any further action arising thereon, and to bear the Financial Adviser’s conclusions in mind when considering the Fund Managers’ reports.
10:30 (a) The Independent Financial Adviser will report orally, on the performance and strategy of Deutsche Asset Management Ltd drawing on the charts at items 5 and 6E. (b) The representative(s) of the Fund Manager will:
In support of the above is their valuation report for the period to 31 March 2003, and a separate report for the period. At the end of the presentation members are invited to question and comment, the Fund Managers to respond and, finally:- (Information Exempt in that it relates to the financial or business affairs of any particular person (other than the authority).) The Committee is RECOMMENDED to consider and to adopt or amend any recommendations before them.
10:55 (a) The Independent Financial Adviser will report orally, on the performance and strategy of Schroder Investment Management drawing on the charts at items 5 and 6E. (b) The representative(s) of the Fund Manager will:
In support of the above is their valuation report for the period to 31 March 2003, and a separate report for the period. At the end of the presentation members are invited to question and comment, the Fund Managers to respond and, finally:- (Information Exempt in that it relates to the financial or business affairs of any particular person (other than the authority).) The Committee is RECOMMENDED to consider and to adopt or amend any recommendations before them.
11:20 The Financial Adviser will, if necessary, summarise the foregoing reports of the Fund Managers’ and answer any questions from members. (Information Exempt in that it relates to the financial or business affairs of any particular person (other than the authority).)
11:25 Report by Head of Finance (PF10E). At the February 2003 Pension Fund Committee Meeting members asked the officers to appoint a transition manager to implement the new specialist investment structure. Transition management involves employing one party, the transition manager, to manage all aspects of the restructuring process. The transition manager’s role is to take the existing fund and complete the restructuring in order to deliver the new portfolio to the fund’s new managers. The aim is to do this in the most cost effective and efficient manner. The report gives details on the selection process for the new transition manager and the reasons for the final selection. (Information Exempt in that it relates to the financial or business affairs of any particular person (other than the authority).) The Committee is RECOMMENDED to note the report.
ITEMS FOLLOWING THE RE-ADMISSION OF THE PRESS AND PUBLIC
11:35 Report by Head of Finance (PF11). The Local Government Pension Scheme (Management and Investment of Funds) Regulations 1998 require the administering authority to monitor and review the performance of its investment managers and to take such action as necessary. Investment managers are required to out-perform, by an agreed percentage, the Committee’s selected scheme specific benchmarks over three-year rolling periods. This performance measurement is used to monitor performance. The Regulations require the administering authority to review the investments made by investment managers at least once every three months. In reviewing an investment manager’s decisions and investments the administering authority must take proper advice about the variety of the investments made and the suitability of those investments for the fund generally and as investments of their type. The administering authority must also periodically consider whether or not to retain the investment manager. The administering authority is the County Council and the Pension Fund Committee has delegated powers to carry out the functions of the administering authority in relation to the Oxfordshire Pension Fund. In turn, the Head of Finance, has delegated powers covering ‘the making of investments of the County Pension Fund in accordance with policies determined by the Pension Fund Committee’. From the 1 July 2003, the number of investment managers will increase from two to four. At the same time, the Committee will have a direct role in the asset allocation strategy that has hitherto been subjugated by the use of peer-group benchmarks. This report considers various arrangements which could be introduced to monitor the performance of investment managers in order to fulfil the administering authority’s responsibilities and asks the Committee to give a steer on their preference. Details of the new arrangements will then be proposed to the 29 August 2003 meeting, in the light of this preference. The Committee is RECOMMENDED to consider the future fund monitoring arrangements in the light of the appointment of the new investment managers and ask the officers to provide a further report on the new monitoring and reporting arrangement to the 29 August 2003 meeting.
12:05 Report by Head of Finance (PF12). The report gives progress on the appointment of a global custodian and with the transition to the revised strategic asset allocation from 1 April 2003. The Committee is RECOMMENDED to note the report.
12:15 Report by Head of Finance (PF13). The report advises the Committee that Watson Wyatt have given notice of withdrawal of their services with effect from November 2003 and provides an action plan for the appointment of a new actuary. The Committee is RECOMMENDED to approve the process to select a new actuary and to decide on the desired level of involvement.
12:25 Report by Head of Legal Services and Solicitor to the Council (PF14). In response to a request made by members of the Committee, the Solicitor to the Council has produced a legal briefing on the role and responsibilities of Elected Members sitting on the Pension Fund Committee. The report highlights the need for Elected Members to exercise due diligence, skill and expertise and provides analysis of relevant Case Law reports. The report explains the extent to which Elected Members on the Pension Fund Committee should be egarded as "Trustees". The Committee is RECOMMENDED to note the report.
12:40 The Committee will receive an oral report on issues arising from officers and Fund Managers in their involvement in matters of Socially Responsible Investment and Corporate Governance. The Committee are RECOMMENDED to note the issues contained within the oral report.
12:50 Report by the Head of Finance (PF16). To consider two applications from qualifying employers, Oxford Night Shelter and the National Organisation for the Counselling of Adoptees and Parents (NORCAP), seeking admission to the Local Government Pension Fund The Committee is RECOMMENDED to approve the applications of Oxford Night Shelter and NORCAP subject to all parties agreeing to the terms of the Admission Agreements, and this Committee being informed when agreements have been signed.
12:55 The
Director for Resources will report on any relevant issues arising
from the last Annual Forum. ADDENDAItem5. Overview of Past and Current Investment Position Attached is the spreadsheet included as table 7. Please note that Charts 13-14, should read for period ‘ended 31 March 2003’ and not ’31 December 2002’ as stated.
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