Agenda and minutes

Venue: Council Chamber, County Hall, Newport, Isle of Wight

Contact: Megan Tuckwell  Email: democratic.services@iow.gov.uk

Media

Items
No. Item

37.

Apologies and Changes in Membership (If Any)

To note any changes in membership of the Committee made in accordance with Part 4B paragraph 5 of the Constitution.

Minutes:

No apologies or changes in membership of the committee were received. 

38.

Minutes pdf icon PDF 337 KB

To confirm as a true record the Minutes of the meeting held on 27 July 2022.

Minutes:

RESOLVED:

 

THAT the minutes of the meeting held on 27 July 2022 be approved.

39.

Declarations of Interest

To invite Members to declare any interest they might have in the matters on the agenda.

Minutes:

No declarations were received.

 

40.

Public Question Time - 15 Minutes Maximum

Questions may be asked without notice but to guarantee a full reply at the meeting, a question must be put including the name and address of the questioner by delivery in writing or by email to Democratic Services at democratic.services@iow.gov.uk, no later than two clear working days before the start of the meeting. Therefore the deadline for written questions will be Friday 18 November 2022.

 

Minutes:

No public questions were received.

 

41.

Pension Fund Operational Structure Review pdf icon PDF 126 KB

To receive an update from the lead consultant from Barnett Waddingham on the process for and progress with the current review of the operational structure for the pension fund.

Additional documents:

Minutes:

The lead consultant from Barnett Waddingham provided a verbal overview of the process for and progress with the current review of the operational structure for the pension fund. Questions were raised and discussion took place regarding staff recruitment and retention. 

 

RESOLVED:

 

THAT the verbal update be received and noted.

42.

Report from the Local Pension Board pdf icon PDF 293 KB

To receive the draft minutes of the meeting the Local Pension Board held on 26 October 2022. 

Minutes:

The chairman of the Local Pension Board was in attendance to present the draft minutes of the meeting held on 26 October 2022 and the  discussions therein. Attention was drawn to the structure review, cyber risk, and climate change activities. Questions were raised in whether the fund could rely on the cyber security measures of the council; consideration needed to be given to wider aspects for the fund including third-party software providers and data transfers with actuary.

 

RESOLVED:

 

THAT the draft minutes of the meeting of the Local Pension Board held on 26 October 2022 be noted.

 

43.

Risk Register pdf icon PDF 425 KB

On recommendation from the Local Pension Board, to adopt the revised risk register for the fund.

Additional documents:

Minutes:

Consideration was given to the revised risk register for the fund, as recommended for adoption by the Local Pension Board. Questions were raised in relation to an incident where access to an assessment tool had been blocked by internal council firewalls and it was confirmed that the matter had been resolved. Clarity was provided around the risk scoring matrix tool. Concerns were raised regarding the combination of the ‘key person’ risk with that for ‘sufficient resources’ and it was felt that matters addressing both resilience and capacity should be separated. The team were thanked for the development and maintenance of the document.

 

RESOLVED:

 

THAT the revised risk register be adopted, and the Local Pension Board be asked to separate the ‘key person’ and ‘sufficient resources’ risks.

44.

Communications Policy pdf icon PDF 355 KB

On recommendation from the Local Pension Board, to adopt the revised  Communications Policy, for publication on the fund’s website.

Additional documents:

Minutes:

Consideration was given to the Communications Policy, for publication on the fund’s website, as recommended for adoption by the Local Pension Board. Discussion took place regarding membership numbers and it was confirmed that the Board receive quarterly updates and monitor any changes in membership. Committee members were reminded of the distinction between the council’s role as administering authority and employer within the fund; questions about the take-up of membership among the council’s employees should be addressed to the council, not the pension committee. Comments were made in relation to information accessibility and consultation with scheme members.

 

RESOLVED:

 

THAT the Communications Policy be adopted.

45.

Governance Compliance Statement 2021-22 pdf icon PDF 416 KB

On recommendation from the Local Pension Board, to adopt the governance compliance statement at August 2022, for inclusion in the annual report and accounts for the year ended 31 March 2022, and to note the proposed action plan to address areas of non-compliance.

Additional documents:

Minutes:

The Pension Fund Manager presented the Governance Compliance Statement for inclusion in the annual report and accounts, as recommended for adoption by the Local Pension Board. Attention was drawn to the proposed action plan to address areas of non-compliance, and discussion took place regarding staff capacity and whether there was sufficient resources in place to facilitate the delivery of those actions. Members were assured that support would be sought from other funds and consultants to ensure improvement.

 

RESOLVED:

 

THAT the Governance Compliance Statement be approved for publication in the fund’s annual report and accounts, and the proposed action plan to address areas of non-compliance be approved.

46.

DLUHC Consultation pdf icon PDF 309 KB

To consider and agree the fund’s proposed response to the DLUHC consultation “Local Government Pension Scheme (England and Wales): Governance and reporting of climate change risks”.

Additional documents:

Minutes:

Consideration was given to the fund’s proposed response to the DLUHC consultation “Local Government Pension Scheme (England and Wales): Governance and reporting of climate change risks”. It was suggested that the ESG/RI Working Group be reconvened to consider the development of the fund’s TCFD-compliant reporting processes, with the inclusion of the scheme member representative. No comments or questions were raised at this stage.

 

RESOLVED:

 

i)               THAT the proposed response to the consultation be approved for submission.

 

ii)              THAT the ESG/RI Working Group be reconvened to consider the development of the fund’s TCFD-compliant reporting processes.

47.

Knowledge and Understanding Update

To receive and note the update on training and development activities undertaken by committee members since the last meeting.

Minutes:

The Pension Fund Manager presented a verbal update on training and development activities undertaken by committee members since the last meeting. Committee members were reminded to complete the recommended training, including the Pension Regulators online toolkit. No comments or questions were raised.

 

RESOLVED:

 

THAT the update be noted.

 

48.

Fund Manager Presentation pdf icon PDF 310 KB

To receive a presentation from GSAM private debt. 

Minutes:

The committee received a presentation and update from Goldman Sachs Asset Management on the Loan Partners IV portfolio, which included a summary of active investments, covid resilience, market opportunities, and a fund profile. Discussion took place regarding investment returns and profits, market exposure in the USA, Russia and China, and oil prices.

 

RESOLVED:

 

THAT the presentation from Goldman Sachs Asset Management be noted.

 

49.

Investment Performance and Funding Level

To receive and note the reports from the fund’s investment consultants:

49a

Investment assets at 30 September 2022 pdf icon PDF 125 KB

49b

Hymans Robertson Investment Performance Report Q3 2022 pdf icon PDF 3 MB

Minutes:

The Investment Consultant of Hymans Robertson presented the investment performance report for the quarter ended 30 September 2022, which included a summary of market returns, capital market outlook, asset allocation, fund performance, and fund manager analysis. Consideration was given to the fund’s investment assets as at 30 September 2022. The committee noted the recent market volatility, and attention was drawn to the performance against benchmarks for Majedie/Liontrust. It was proposed that the Investment Consultants be asked to pursue the investment reallocation from Liontrust to Blackrock. Concerns were raised in relation to the exposure to the tobacco industry and it was agreed that the removal of this allocation be explored in due course.

 

RESOLVED:

 

i)               THAT the investment performance and funding level be noted.

 

ii)              THAT the Investment Consultants of Hymans Robertson be authorised to pursue the investment reallocation from Liontrust to Blackrock, with the removal of tobacco exposure to be explored at a later date. 

 

50.

Workplan pdf icon PDF 409 KB

To note and agree the proposed workplan for future pension board and committee meetings, including development sessions and fund manager presentations. 

Minutes:

Consideration was given to the workplan for the Pension Fund Committee and Local Pension Board for the 2022-23 financial year. No comments or questions were raised.

 

RESOLVED:

 

THAT the workplan be noted.

51.

Items circulated for Members Attention pdf icon PDF 86 KB

To note the items circulated to committee members since the papers were published for last committee meeting, for information.

Minutes:

The committee noted the items circulated for information since the last meeting. No comments or questions were raised.

 

RESOLVED:

 

THAT the items circulated for attention be noted.

 

52.

Members' Question Time

To guarantee a reply, a question must be submitted in writing or by email to democratic.services@iow.gov.uk no later than 10.00am, Monday 21 November 2022. A question may be asked at the meeting without prior notice but in these circumstances there is no guarantee that a full reply will be given at the meeting.

Minutes:

Cllr Churchman asked an oral question seeking clarification around LDI  funds. The Fund’s Actuaries and Investment Consultant at Hymans Robertson provided a response.

 

Following discussion, the committee adjourned for a five-minute comfort break.

 

53.

Exclusion of Public and Press

To consider passing a resolution that, under Section 100(A)(4) of the Local Government Act 1972, the public and press be excluded from the meeting for the following item of business, namely agenda item(s) 18 to 21 on the grounds that there is likely to be disclosure of exempt information as defined in paragraphs 3 of Part 1 of Schedule 12A of the Act and in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

Minutes:

RESOLVED:

 

THAT the public and press be excluded.

 

54.

Triennial Valuation pdf icon PDF 152 KB

To receive and note the update on the triennial valuation, including the whole fund results and employer engagement progress. 

Additional documents:

Minutes:

The committee received an update from the Fund’s Actuaries at Hymans Robertson on the progress with the triennial valuation, including the whole fund results and employer engagement progress. Discussion took place regarding contribution rates and LGPS fund risks. 

 

RESOLVED:

 

i)               THAT the presentation, the valuation results for the whole fund, and the process for the finalisation of the valuation (including the process for the circulation and agreement of individual employer results) be noted.

 

ii)              THAT the draft Funding Strategy Statement, and the process for consultation prior to its adoption, be noted.

55.

Strategic Asset Allocation pdf icon PDF 135 KB

Additional documents:

Minutes:

The committee received the report on the initial results of the modelling in respect of the fund’s strategic investment asset allocation.

 

RESOLVED:

 

i)               THAT the presentation be noted.

 

ii)              THAT the committee agree to consider any changes to the strategic asset allocation once the triennial valuation is completed.

56.

ACCESS Update pdf icon PDF 253 KB

To receive and note an update on activity with the ACCESS pool since the last meeting.

Additional documents:

Minutes:

The Pension Fund Manager presented the report on recent ACCESS pool activities since the last meeting. No comments or questions were raised.

 

RESOLVED:

 

THAT the update be noted.

 

57.

Procurement / Contract Management Update

57a

Procurement and Contract management activity

To receive and note an update on procurement and contract management activity since the last meeting.

Additional documents:

Minutes:

The Pension Fund Manager presented the confidential update on procurement and contract management activities since the last meeting. No comments or questions were raised.

 

RESOLVED:

 

i)               THAT the update be noted.

 

ii)              THAT the following contract awards be noted; (a) the global custodian contract to Northern Trust Limited, (b) the structure review contract to Barnett Waddingham LLP, and (c) the member tracing services contract to Target professional Services (UK) Limited.

 

iii)            THAT the extension of the governance consultancy contract for a further 12 months to 1 January 2024 be noted.

 

57b

Annual Compliance Statement in respect of Contract Management pdf icon PDF 286 KB

To consider the Annual Compliance Statement in respect of the CMA’s Investment Consultancy and Fiduciary Management Market Investigation Order 2019.

Additional documents:

Minutes:

Consideration was given to the annual compliance statement in respect of contract management. No comments or questions were raised.

 

RESOLVED:

 

i)               THAT the current objectives for the fund’s investment consultants be noted.

 

ii)              THAT the fund’s compliance with the requirements of Parts 3 and 7 of the Investment Consultancy and Fiduciary Management Market Investigation Order 2019 be confirmed.

 

iii)            THAT the chairman be authorised to sign the annual compliance statement after 9 December 2022 (to be submitted before 6 January 2023), and a report be presented to the Committee at its next meeting in February 2023 confirming it’s submission.