Pension Sub-committee And Pension Board - 25/06/2007

At a MEETING of the SUPERANNUATION INVESTMENT SUB-COMMITTEE OF THE POLICY AND RESOURCES COMMITTEE held at Dundee on 25th June, 2007.

Present:-

BAILIES

George REGAN

Willie SAWERS

Roderick A J WALLACE

COUNCILLORS

Joe MORROW

Kevin KEENAN

Ken LYNN

Councillor Joe MORROW, Convener, in the Chair.

Unless marked thus * all items stand delegated.

I MINUTE OF MEETING OF 21ST FEBRUARY, 2007

The minute of meeting of the Superannuation Investment Sub-Committee of 21st February, 2007 was submitted and approved.

II PROPOSED TIMETABLE OF MEETINGS FOR 2007/08

Reference was made to Article III of the minute of meeting of this Committee of 21st February, 2007, whereby a timetable of meetings was agreed.

The Sub-Committee agreed to note the following changes to dates previously agreed:-

(i) Monday, 3rd September at 12.00 replaced Wednesday, 15th August at 11.00

(ii) Monday, 19th November at 12.00 replaced Wednesday, 16th November at 11.00

The Sub-Committee further noted that the Head of Finance had undertaken to develop a training programme for elected members on the Sub-Committee.

III OVERVIEW OF SUPERANNUATION FUNDS

The Head of Finance and Chief Exchequer Officer gave a short presentation to members of the Sub-Committee on the history of the superannuation funds, and their operation thereof by the various fund managers. Members noted that various investment advisers also assisted with the operation of the funds and that investment strategies were set out on an annual basis.

Thereafter, the Sub-Committee thanked the Chief Exchequer Officer for his helpful presentation.

IV SOCIALLY RESPONSIBLE INVESTMENT - SIX MONTHLY REPORT

There was submitted Report No 312-2007 by the Head of Finance reviewing the progress by the Fund Managers regarding the positive engagement strategy approved by the Sub-Committee on 23rd February, 2000.

The Sub-Committee agreed to note the information contained within the report with regard to the activities of the Fund Managers during the six month period ended 31st March, 2007.

The Sub-Committee resolved under Section 50(A)(4) of the Local Government (Scotland) Act 1973 that the public and press be excluded from the meeting for the undernoted items of business on the grounds that they involved the likely disclosure of exempt information as defined in paragraphs 4, 6 and 11 of Part I of Schedule 7A of the Act.

V TAYSIDE SUPERANNUATION FUNDS

(a) PERFORMANCE SUMMARIES

There was submitted Report No 313-2007 by the Head of Finance relating to Performance Summaries for the quarter twelve months and three years to 31st March, 2007 reviewing the investment performance of the Main Fund's four Fund Managers (excluding Property) for the quarter to 31st March, 2007 and considering the performance of the Transport Fund which shares two of these managers.

The report also compared investment performances of the Funds with the Funds' specific benchmarks which consist of various stock market indices.

The Sub-Committee noted the information contained within the report with regard to the performance of the Tayside Superannuation Fund and Tayside Transport Superannuation Fund and their Fund Managers.

(b) PERFORMANCE SUMMARY (PROPERTY PORTFOLIO)

There was submitted Report No 314-2007 by the Head of Finance relating to Schroder Property Investment Management Limited performance for the quarter, twelve months and three years to 31st March, 2007 reviewing the investment performance of the Property Portfolio managed by Schroder Property Investment Management Ltd, for the quarter to 31st March, 2007 and for the twelve month period to the same date, and comparing investment performances with an appropriate benchmark the HSBC/IPD Pooled Property All Balanced Funds Median from 1st April, 2004. Information prior to this would still compare to the previous HSBC/IPD Pooled Property All Funds Median benchmark.

The Sub-Committee noted the information contained herein with regard to the performance of the Property Portfolio managed by Schroder Property Investment Management Ltd.

There was submitted Report No 287-2007 by the Head of Finance summarising investments and transactions during the period 1st January to 31st March, 2007 reviewing the investment activities of the Main Fund's five Fund Managers for the quarter to 31st March, 2007. The Transport Fund shares three of these managers and their transactions were included also.

The report also summarises the transactions of each Fund Manager and showed the market values of the Main and Transport Fund.

The Sub-Committee noted the information contained within the report with regard to the activities of the Tayside Superannuation Fund and Tayside Transport Superannuation Fund and their Fund Managers.

(d) QUARTERLY FUNDING REPORT

There was submitted Report No 315-2007 by the Head of Finance which considered a report by Barnett Waddington reviewing the current funding level of the Funds as assessed by Barnett Waddingham, the Fund Actuary.

The Sub-Committee noted the report by Barnett Waddingham.

VI PRESENTATION

Sam Morse and Nick Birchall of Fidelity gave a presentation.

Nick advised members that the Performance objection of Fidelity was to out-perform the Performance Benchmark, to be achieved by a disciplined investment approach focussing on stock selection which would focus on dividend growth and ensuring that appropriate risk controls were in place.

Thereafter, Sam outlined the buying criteria of Fidelity, noting that focus was given to companies showing a proven business model.

The speakers were thanked for their attendance by the Convener.

Joe MORROW, Convener.

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