Pension Sub-committee And Pension Board - 09/12/2019

At a JOINT MEETING of the PENSION SUB-COMMITTEE of the POLICY AND RESOURCES COMMITTEE AND THE PENSION BOARD held at Dundee on 9th December, 2019.

 

Present:-

 

PENSION SUB-COMMITTEE

 

BAILIES

 

Willie SAWERS

Kevin KEENAN

 

COUNCILLORS

 

Anne RENDALL

Steven ROME

 

 

PENSION BOARD

 

Arthur NICOLL

Kenny DICK

George RAMSAY

Gordon MURRAY

 

Claire SHEPHERD

 

Bailie Willie SAWERS, in the Chair.

 

I DECLARATION OF INTEREST

 

Councillor Rendall declared a non-financial interest in Article XII.

 

II MINUTE OF PREVIOUS MEETING

 

The minute of meeting of 23rd September, 2019 was submitted and approved.

 

III APPOINTMENT OF CHAIRPERSON OF PENSION BOARD

 

There was submitted Agenda Note AN83-2019 advising that in accordance with the Public Service Pensions Act 2013, the Sub-Committee and Board were asked to seek nominations for the post of Chair of the Pension Board for the period of twelve months.

 

The Sub-Committee and Board agreed that George Ramsay be appointed as Chair of the Pension Board for the next twelve months.

 

IV TAYSIDE PENSION FUNDS RISK REGISTER

 

There was submitted Report No 412-2019 by the Executive Director of Corporate Services updating the Risk Register for Tayside Pension Fund.

 

The Sub-Committee and Board approved the updated Quarterly Risk Register for Tayside Pension Fund, and noted the following change to the risk profile since the previous report:-

 

Risk 1 Failure to process pension payments and lump sums on time.

 

An operational process review identified a failure to issue deferred benefit entitlement and options notifications within the two month statutory timescale. A report was submitted to the Pensions Regulator informing of the breach, and an improvement plan was now in place to ensure that sufficient resources were allocated to meet statutory requirements and prevent recurrence. The risk would reduce once the backlog had been reduced and statutory requirements were met.

 

The cause of breach was due to the prioritisation of other tasks thus creating backlogs in this process, which had been further exacerbated by staff turnover and large scale voluntary and early retirement initiatives being undertaken by all larger employers.

V PENSION ADMINISTRATIVE PERFORMANCE QUARTERLY UPDATE

 

There was submitted Report No 413-2019 by the Executive Director of Corporate Services providing information on the recent quarters operational performance in relation to Pension Administration.

 

The Sub-Committee and Board noted the content of the report, and in particular noted the submission to The Pensions Regulator at 6.2.

 

VI TREASURY MANAGEMENT ACTIVITY 2019/2020 (MID-YEAR REVIEW)

 

There was submitted Report No 414-2019 by the Executive Director of Corporate Services reviewing Tayside Pension Funds Treasury Management activities for the period 1st April, 2019 to 30th September, 2019.

 

The Sub-Committee and Board noted the content of the report.

 

VII PROPOSED TIMETABLE OF MEETINGS FOR 2020

 

There was submitted Report No 415-2019 by the Executive Director of Corporate Services proposing a suggested programme of meetings of the Pension Sub-Committee and Pension Board in 2020.

 

The Sub-Committee and Board examined the dates set out in the timetable in Appendix 1 and agreed the proposed programme of meetings as detailed.

 

VIII ANNUAL ASSESSMENT OF INVESTMENT ADVISORY SERVICE

 

There was submitted Report No 416-2019 by the Executive Director of Corporate Services providing information on the future requirement issue by the Competition and Markets Authority to set objectives for investment advisors.

 

The Sub-Committee and Board noted the content of the report.

 

IX REPORT FOLLOWING REVIEW OF THE STRUCTURE OF THE SCOTTISH LOCAL GOVERNMENT PENSION SCHEME

 

There was submitted Report No 417-2019 by the Executive Director of Corporate Services providing information following the review of the structure of the Scottish Local Government Pension Scheme carried out by the Pensions Institute on behalf of the Pension Scheme Advisory Board.

 

The Sub-Committee and Board noted the content of the report.

 

The 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 involved the likely disclosure of exempt information as defined in paragraphs 4, 6 and 11 of Part I of Schedule 7A of the Act.

 

X TAYSIDE PENSION FUNDS

 

(a) PERFORMANCE SUMMARIES

 

There was submitted Report No 418-2019 by the Executive Director of Corporate Services relating to Performance Summaries for the quarter 1, 3 and 5 year time periods to 30th September, 2019 reviewing the investment performance of the Funds Investment Managers for the quarter 30th September, 2019. The report compared investment performance of the Funds with the Funds specific benchmarks which consisted of various stock and security market indices.

 

The Sub-Committee and Board noted the information contained therein with regard to the performance of the Tayside Main Fund and their Fund Managers.

 

(b) SUMMARIES OF INVESTMENT AND TRANSACTIONS

 

There was submitted Report No 401-2019 by the Executive Director of Corporate Services summarising investments and transactions during the period 1st July to 30th September, 2019 reviewing the investment activities of the Main Funds seven Fund Managers for the quarter to 30th September, 2019 and summarising the transactions of each Fund Manager and showing the market value of the Main Fund.

 

The Sub-Committee and Board noted the information contained therein with regard to the activities of the Tayside Pension Fund and its Fund Managers.

 

(c) QUARTERLY FUNDING REPORT

 

There was submitted Report No 419-2019 by the Executive Director of Corporate Services which considered a report by the Fund Actuary reviewing the current funding level of the Fund as assessed by the Fund Actuary.

 

The Sub-Committee and Board noted the content of the report.

 

XI EMPLOYER COVENANT REVIEW UNDERTAKEN BY PWC ON BEHALF OF TAYSIDE PENSION FUND

 

There was submitted Report No 420-2019 by the Executive Director of Corporate Services enclosed, which considered report by PwC who had undertaken a review on behalf of Tayside Pension Fund providing a summary of the review.

 

The Sub-Committee and Board agreed to:-

 

(i) note the content of the report; and

 

(ii) delegate authority to the Executive Director of Corporate Services to engage with employers in terms of the recommended actions contained in the report in order to strengthen employer covenant, reduce risk of financial loss to the fund and subsequent potential impact on other employers.

 

XII POST TRANSITION SUMMARY REPORT

 

There was submitted Report No 421-2019 by the Executive Director of Corporate Services which considered a report by KPMG.

 

The Sub-Committee and Board agreed to note the content of the report.

 

XIII SOCIALLY RESPONSIBLE INVESTMENT SIX MONTHLY REPORT

 

There was submitted Report No 422-2019 by the Executive Director of Corporate Services.

 

This report reviews the progress by the Fund Managers regarding positive engagement in line with the Policy on Environmental, Social and Corporate Governance as previously approved by the Sub‑Committee and Board.

 

The Sub-Committee and Board noted the information contained within the report with regards to the activities of the Fund Managers during the six month period ended 30th September, 2019.

 

XIV PRESENTATION

 

Jeremy Podger and David Barber from Fidelity gave a short presentation to the Sub-Committee and Board.

 

The Sub-Committee and Board noted the investment strategy of Fidelity and their long-term approach to investment, which was designed to deliver strong performances over rolling periods. Commitment to environment, social and governance issues also remained and key investment philosophy.

 

After Jeremy and David had given their presentation and answered questions from members, the Convener thanked the presenters on behalf of members.

 

 

 

 

Willie SAWERS, Convener.