Agenda and minutes

Received from David Bennett, Maggie Elliott, Thelma Harvey and Marion Oliver, observers from Pensions Board.

Apologies for lateness received from Councillor Andy Hull.

None.

If you have a Disclosable Pecuniary Interest* in an item of business:

         if it is not yet on the council’s register, you must declare both the existence and details of it at the start of the meeting or when it becomes apparent;

         you may choose to declare a Disclosable Pecuniary Interest that is already in the register in the interests of openness and transparency. 

In both the above cases, you must leave the room without participating in discussion of the item.

If you have a personal interest in an item of business and you intend to speak or vote on the item you must declare both the existence and details of it at the start of the meeting or when it becomes apparent but you may participate in the discussion and vote on the item.

*(a)      Employment, etc - Any employment, office, trade, profession or vocation carried on for profit or gain.

(b)        Sponsorship - Any payment or other financial benefit in respect of your expenses in carrying out duties as a member, or of your election; including from a trade union.

(c)        Contracts - Any current contract for goods, services or works, between you or your partner (or a body in which one of you has a beneficial interest) and the council.

(d)        Land - Any beneficial interest in land which is within the council’s area.

(e)        Licences- Any licence to occupy land in the council’s area for a month or longer.

(f)        Corporate tenancies - Any tenancy between the council and a body in which you or your partner have a beneficial interest.

 (g) Securities - Any beneficial interest in securities of a body which has a place of business or land in the council’s area, if the total nominal value of the securities exceeds £25,000 or one hundredth of the total issued share capital of that body or of any one class of its issued share capital. 

This applies to all members present at the meeting.

None.

RESOLVED:

That the minutes of the meeting held on 21 September 2016 be confirmed as a correct record and the Chair be authorised to sign them.

RESOLVED:

(a) That the performance of the Fund from 1 July to 30 September 2016, as per the BNY Mellon interactive performance report, detailed in the report of the Corporate Director of Finance and Resources, be noted.           

(b) That the report by Allenbridge Investment Advisers on fund managers’ quarterly performance, detailed in Appendix 2 to the report and their presentation, be noted.

(c)  That the explanatory memorandum to the Local Government Pension Scheme (Management and Investment of Funds) Regulations 2016, detailed at Appendix 1 of the report and effective from 1 November 2016, be noted.

RESOLVED:

That the progress made at the London CIV in launching funds and running portfolios from September to October 2016, detailed in the report of the Corporate Director of Finance and Resources, be noted.

Karen Shackleton left the room during consideration of the following item.

RESOLVED:

(a) That, subject to the addition of a training session before the Pensions Board and Sub-Committee on 13 March 2017 on “Actuarial review”, the contents of Appendix A, detailing proposed agenda items for future meetings and attached to the report of the Corporate Director of Finance and Resources, be noted:

(b) That it be noted that the Corporate Director of Finance and Resources had approved the renewal of the independent investment advice, provided by Allenbridge, for 18 months, up to 30 September 2017.

Nick Sykes, Mercer, gave a presentation on their review of the Sub-Committee’s decision to reduce the carbon footprint of the Fund’s equity assets, via a low carbon passive equity allocation.

RESOLVED:

(a) That the confidential presentation prepared by Mercer Limited, attached as Appendix 1 to the report of the Corporate Director of Finance and Resources, be noted.    

(b) That the carbon footprint level of equities in the In-House UK Passive Fund be reduced with immediate effect, with 50% of assets allocated to Legal and General Investment Management’s MSCI World Low Carbon Target Index Fund and the remaining 50% of assets managed in house to track the FTSE UK Low Carbon Optimised index.

(c) That officers investigate how a low carbon approach could be realised for the rest of the Fund, which does not comprise equities.

Ian Kirk, the Fund Actuary, gave a presentation on the Funding Strategy Statement (FSS) for the Fund, covering the key governing documents, purpose and regulatory requirements of the FSS and the areas of focus for 2016.

A low return future environment was anticipated for the LGPS and other funds. Taking this into account, with overall performance, an assumption of an increase in future employers’ costs, from 12% to 14% (approximately £3m), was being proposed. The past service cost would fall to net off some of this increase.

However, members of the Sub-Committee considered that this was a very pessimistic assumption and had expected to consider an increase in employers’ costs of between 5% and 11%.

RESOLVED:

That officers produce information on equities over the long term for the Pension Fund as a whole, to be considered at an additional meeting of the Sub-Committee in January 2017, together with information on the membership profile and an analysis of the assumptions made by the Actuary with regard to future employers’ costs.

RESOLVED:

That the contents of the confidential appendix, produced by Mercer Limited, on issues related to the implementation of a low carbon footprint for the Fund, be noted.