Policy And Resources Committee - 09/01/2012

At a MEETING of the POLICY AND RESOURCES COMMITTEE held at Dundee on 9th January, 2012.

Present:-

BAILIES

COUNCILLORS

Councillor Ken GUILD, Convener, in the Chair.

The minute of meeting of this Committee of 12th December, 2011 was held as read.

Unless marked thus * all items stand delegated.

I MINUTE - SUPERANNUATION INVESTMENT SUB-COMMITTEE - 28TH NOVEMBER, 2011

The minute of meeting of the above Sub-Committee, a copy of which is appended hereto, was submitted for information and record purposes (Appendix I).

II REVENUE MONITORING

There was submitted Report No 554-2011 by the Director of Finance providing the Committee with an analysis of the 2011/2012 Projected Revenue Outturn as at 30th November, 2011.

The Committee:-

(i) noted that the overall General Fund 2011/2012 Projected Revenue Outturn as at 30th November, 2011 showed an underspend of 80,000 against the adjusted 2011/2012 Revenue Budget;

(ii) noted that the Housing Revenue Account as at 30th November, 2011 was projecting a breakeven position against the adjusted HRA 2011/2012 Revenue Budget;

(iii) instructed the Director of Finance to take every reasonable action to ensure that the 2011/2012 revenue expenditure was below or in line with the adjusted Revenue Budget; and

(iv) instructed the Director of Finance, in conjunction with all Chief Officers of the Council, to continue to monitor the Council's 2011/2012 Projected Revenue Outturn.

III CAPITAL MONITORING

There was submitted Report No 556-2011 by the Director of Finance appraising members of the latest position regarding the Council's Capital Expenditure Programme for 2011/2012.

The Committee noted the contents of the report.

IV DUNDEE COMMUNITY REGENERATION FUND 2011/2012

There was submitted Report No 5-2012 by the Chief Executive relative to the above.

The Committee approved the funding process and the proposals contained in Section 5.2 of the report appended hereto (Appendix II).

V SINGLE OUTCOME AGREEMENT - ANNUAL REPORT 2011/2012

After considering Report No 11-2012 by the Chief Executive relative to the above, the Committee endorsed the Single Outcome Agreement Annual Report 2010/2011 appended thereto.

VI PROGRESS WITH PROGRAMMES AND INDICATORS IN THE COUNCIL PLAN 2010/2012

There was submitted Report No 555-2011 by the Chief Executive relative to the above.

The Committee:-

(i) noted the progress which had been made so far on the programmes and indicators included in the Council Plan 2010/2012; and

(ii) remitted to the Chief Executive to provide a full annual report to the June 2012 meeting of this Committee.

VII COUNTER-FRAUD REPORT - AS AT 30TH SEPTEMBER, 2011

There was submitted Report No 557-2011 by the Director of Finance informing elected members on the Revenue Division's Housing Benefit and Council Tax Benefit counter-fraud activity as at 30th September, 2011.

The Committee approved the report.

VIII LOCAL GOVERNMENT FINANCE SETTLEMENT 2012/2015 FINANCIAL IMPLICATIONS FOR THE CITY COUNCIL AND REVENUEBUDGET/COUNCIL TAX SETTING PROCEDURE

There was submitted Report No 22-2012 by the Director of Finance advising elected members of the announcement made by the Cabinet Secretary for Finance, Employment and Sustainable Growth on 8th December, 2011 in respect of the Local Government Finance Settlement for the three year period 2012/2015.

The Committee:-

(i) noted the contents of the report;

(ii) noted the Council's Revenue Funding Allocation for the three year period 2012/2015, as announced by the Cabinet Secretary for Finance, Employment and Sustainable Growth on 8th December, 2011, and the associated implications;

(iii) noted that the Leader of the Council had written to the Cabinet Secretary for Finance, Employment and Sustainable Growth on 20th December, 2011 to advise that the City Council agreed, in principle, to the terms set out in the letters of 21st September and 8th November, 2011 (and as detailed in Section 4 of the report);

(iv) noted the current position on the Council's Provisional 2012/2013 Revenue Budget;

(v) noted that the financial information included in the report would be updated, as necessary, and included in the Council Tax proposals to be submitted to the Special Policy and Resources Committee on 9th February, 2012; and

(vi) agreed the procedures to be followed for setting the 2012/2013 Revenue Budget and Council Tax level, as set out in Section 8 and Appendix 2 of the report.

IX TAYSIDE SUPERANNUATION FUNDS ACCOUNTS 2010/2011

(a) AUDITED STATEMENT OF ACCOUNTS - TAYSIDE SUPERANNUATION FUNDS

The above report was submitted and noted (Report No 8-2012).

(b) EXTERNAL AUDITOR'S REPORT

The above report was submitted and noted (Report No 6-2012).

(c) EXTERNAL AUDITOR'S REPORT - RESPONSE FROM DUNDEE CITY COUNCIL

There was submitted Report No 7-2012 by the Director of Finance in response to a report by the Council's External Auditor on the audit of Tayside Superannuation Funds for the year to 31st March, 2011.

The Committee endorsed the report as the Fund's formal response to the External Auditor's report and noted the completed Action Plan appended to the report.

Ken GUILD, Convener.

APPENDIX I

At a MEETING of the SUPERANNUATION INVESTMENT SUB-COMMITTEE OF THE POLICY AND RESOURCES COMMITTEE held at Dundee on 28th November, 2011.

Present:-

Bailie Willie SAWERS

COUNCILLORS

Bailie Willie SAWERS, Convener, in the Chair.

Unless marked thus * all items stand delegated.

I PROPOSED TIMETABLE OF MEETINGS FOR 2012

There was submitted Report No 526-2011 by the Director of Finance proposing a suggested programme of meetings of the Superannuation Investment Sub-Committee to cover investment performance and issues arising in 2012.

The Sub-Committee agreed the proposed programme of meetings as detailed.

II SOCIALLY RESPONSIBLE INVESTMENT - SIX MONTHLY REPORT

There was submitted Report No 527-2011 by the Director of Finance reviewing the progress by the Fund Managers regarding the positive engagement policy on Environmental, Social and Corporate Governance approved by the Sub-Committee on 17th November, 2008.

The Sub-Committee noted the information contained within the report with regard to the activities of the Fund Managers during the six month period ended 30th September, 2011, and agreed that a follow-up report be submitted to ensure all outstanding issues were resolved.

III PERMITTED COUNTERPARTIES FOR INVESTMENT TRANSACTIONS

There was submitted Agenda Note AN184-2011, whereby reference was made to Article VII of the minute of meeting of the Superannuation Investment Sub-Committee of 29th August, 2011, wherein approval was given to Report No 117-2011 "Treasury Management Strategy". Appendix 1 of the report detailed the credit ratings and maximum deposits to be placed with approved ending bodies. To reflect the downgrading of two approved lending bodies from F1+ to F1 on 14th October, 2011, reduced maximum deposit limits have been operated with effect from 1st November, 2011. On five occasions between 18th October, 2011 and 27th October, 2011, sums which exceeded the F1 (but not F1+) maximum deposit limits were held. Recommended revised limits are detailed below:-

Money Market Funds

* This 5m limit applies to the call account. Additional smaller balances (less than 1m) may also be held in the current account.

Any institution whose credit rating fell below the limits set above would no longer be a permitted counterparty for further transactions.

The Sub-Committee approved this recommendation.

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

IV TAYSIDE SUPERANNUATION FUNDS

(a) PERFORMANCE SUMMARIES

There was submitted Report No 525-2011 by the Director of Finance reviewing the investment performance of the Main Fund's four Fund Managers (excluding Property) and the Financing Fund for the quarter to 30th September, 2011. It also considered the performance of the Transport Fund which shared two of these managers.

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

The Sub-Committee noted the information contained therein 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 524-2011 by the Director of Finance reviewing the investment performance of the Property Portfolio for the period to 30th September, 2011.

The report compared investment performances with an appropriate benchmark, the IPD Pooled Property All Balanced Funds Median.

The Sub-Committee noted the information contained therein with regard to the performance of the Property Portfolio.

(c) SUMMARIES OF INVESTMENTS AND TRANSACTIONS

There was submitted Report No 513-2011 by the Director of Finance reviewing the investment activities of the Main Fund's six Fund Managers for the quarter to 30th September, 2011. The Transport Fund shared three of these managers and their transactions were included.

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

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

V REVIEW OF PERFORMANCE

Allison Galbraith of Hymans Robertson reviewed the performance of the Fund and the individual managers over the year.

The Sub-Committee noted the content of the Hymans Robertson report.

VI FUND MANAGER REVIEW

There was submitted Report No 529-2011 by the Director of Finance reviewing the position of a Fund Manager given the recent performance which had continued to be significantly below benchmark.

The Sub-Committee agreed that no action be taken at the current time but that the performance of the Fund Manager be kept under review. It was further agreed that a presentation be given to members to fully explore the future investment relationship with the Fund Manager.

VII PRESENTATION

Gillian Evans and Anna Troup of Goldman Sachs Asset Management gave a short presentation.

A summary of the performance of the Portfolio was given, noting the key performance drivers, and comparing this to benchmark figures. Market performance over Quarter Three was given and consideration given for the future.

After they had answered questions from members, the Convener thanked Gillian and Anna for their interesting and informative presentation.

Willie SAWERS, Convener.

APPENDIX II