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The minutes are published. No summary has been written yet.
1.1 Apologies were received from Councillor Nicholas Simons.
2.1 Members confirmed the following declarations of personal interest: Councillor In Receipt of Pension Contributor Karl Gauden NONE Self, wife, step-daughter and step-daughter’s partner Jon Horlor NONE Self Alan Slade Self Self David Williams Self and wife Self and wife Nathan Yeowell Father and two other family members (aunts) Self 2.2 In addition to the above, Councillor Gauden also declared a personal interest due to his work as a Unison official. 2.3 The PS left the meeting.
3.1 The minutes of the meeting held on 13 June 2022 were confirmed as an accurate record.
4.1 The Committee noted the minutes.
5.1 The HoP outlined the draft report and provided an update to members of the Committee regarding the Fund’s Annual Report and Accounts for the year ended 31 March 2022. 5.2 The HoP confirmed that work was still ongoing, which would include presenting it to members of the Pension Board. The finalised version would be presented to the Pensions Committee on 21 November 2022. 5.3 The Pensions Committee agreed to note the draft Annual Report and Accounts for 2021/22.
6.1 The HoP highlighted the following key headlines from the report: • The meeting of the Joint Governance Committee (JGC) of the Wales Pension Partnership (WPP) scheduled for 21 September 2022 had been cancelled due to the death of HM The Queen and the JGC would next meet during December 2022. • The Sustainable Active Equity Sub-Fund had a targeted launch date of January 2023. The Chair of the Pensions Committee, the Fund’s advisors and the Responsible Investor Working Group (RIWG) viewed this as a good investment opportunity for the Fund and a proposal was due to be presented to the Pensions Committee on 12 December 2022. • Dye & Durham had removed themselves from negotiations to takeover Link Group. The Fund was comfortable with the service that Link continued to provide and the above would have no impact on the Fund at present; however the situation would be monitored. Link’s current contract with the WPP was due to end in December 2024. 6.2 The Chair confirmed that WPP online training had focussed on sustainable investments, and he had expressed to the JGC that the Fund was pleased with the WPP’s direction of travel regarding this area, in particular regarding the Sustainable Active Equity Sub-Fund. 6.3 The Pensions Committee agreed to note the contents of the report. 6.4 Councillor Jon Horlor entered the meeting.
7.1 The HoP outlined the report on Pension Fund investment performance in the period 1 April 2022 through to 30 June 2022 (quarter 2 of 2022). 7.2 The HoP confirmed that the Fund’s officers and advisors continued to meet investment managers on a quarterly basis and were conscious of the current economic environment; however he reminded members of the Committee that the Fund was a long-term investor and long-term performance remained positive and ahead of the benchmark. 7.3 The Chair reminded members of the Committee that a lot had changed in recent weeks in light of the UK Government’s budget announcement. 7.4 The IA outlined Appendix 1 of the report and made the following comments: · The “Three I’s” of inflation, interest rates and invasion of Ukraine had given way to the “Three E’s” of energy, expectations (around interest rates, government decisions, etc) and elections during the quarter, and she detailed the impact that these areas had on the markets. · Having a global investment portfolio was beneficial in times of a weakened currency. · The recent UK budget announcement had impacted markets and resulted in a sell-off of UK gilts; however the more recently modified budget would need to be monitored and markets would need to focus on resilience. She warned that Equity markets would have a long winter ahead of them. · Governments were being faced with an “energy trilemma”, as outlined on page 181 of the agenda, and the three factors were important to the Fund in terms of responsible investments. 7.5 The RA explained that during June 2022 UK sterling had fallen by 10% compared to the US dollar, and by a further 17% during September 2022. As all of the Fund’s liabilities were in UK sterling, the above required consideration from the Fund’s officers and advisors regarding the future. 7.6 Following questions from the Committee, the IA and RA made the following points: • The RA confirmed that a shift in oil prices would force the markets towards greener options, as higher prices were like a carbon tax. • The IA stated that the sustainability agenda was very important to the Fund; however returns should not necessarily be sacrificed in order to achieve it as they were seeing opportunities that could achieve both. She added that the Fund’s consideration of all investment opportunities targeted returns in excess of the long-term actuarial assumption. 7.7 The Pensions Committee agreed to note the investment performance that had taken place during quarter two of 2022.
8.1 The PM outlined the report and provided a brief update on the administration services provided by the Pension Section and indicated a number of areas of current activity and development. 8.2 Since the report was published, the PM confirmed that the number of members registered for My Pension Online (MPO) had increased to 22.5% of the Funds’ total membership. This was very positive as MPO was a new system that had only been active for approximately 12 months. 8.3 The PM was pleased that 46 out of 57 employers were now submitting their data to the Fund through i-Connect; however it was hoped that all 57 employers would be doing it by next year and officers of the Fund were working with employers in order to achieve this. The PM added that the amount of data required from each local authority was very large, which could explain why only Torfaen County Borough Council had managed the move to i-Connect so far. 8.4 The Pensions Committee agreed to note the content of the report.
9.1 The HoP outlined the report and provided a quarterly overview of the Fund’s risk register and approach to managing risk. 9.2 The HoP confirmed that the proposed changes were outlined in paragraph 3.7 of the report and further proposed changes around such areas as funding and the actuarial valuation would likely be presented to Pensions Committee on 12 December 2022. 9.3 The Pensions Committee agreed to note the updated risk register including the changes proposed.
10.1 The HoP outlined the report and provided an overview of the key updates discussed during the most recent RIWG meeting that was held on 23 August 2022. 10.2 The HoP reminded members of the Committee that the Fund’s investment exposure to Russia currently stood at zero; however this could increase over time. He confirmed that the Fund would look to divest from these investments as soon as it was possible. 10.3 The Pensions Committee agreed to note the contents of the update.
11.1 The PM outlined the report and provided an update of training already undertaken by members of the Pensions Committee (as shown in Appendix 1 of the report), for information, and to aid consideration of future training requirements. 11.2 The PM confirmed that Hymans Robertson, had launched the 2022 National Knowledge Assessment (NKA) and she would be inviting all members of the Pensions Committee and Pension Board to undertake it, which would help the Fund identify its future training needs. 11.3 The PM reminded members of the Committee that the Local Government Pension Scheme (LGPS) Governance Conference would be held on 19-20 January 2023, and she invited members to inform her if they wished to attend. 11.4 The Pensions Committee agreed to: (i) Note the training update provided within the report; (ii) Be invited to complete the National Knowledge Assessment once received from Hymans Robertson in September; and (iii) Receive a further report from officers on the outcomes as they relate to the Fund.
12.1 The next meeting is scheduled to take place on 21 November 2022.
13.1 The Committee agreed to the exclusion of the press and public from the meeting as presentations and meeting papers were not for publication because in accordance with paragraphs 12 and 14 of part 4 of Schedule 12a of the Local Government Act 1972 (as amended by the Access to Information Variation Order Wales 2007), it contained information about a particular individual and information relating to the financial and business affairs of particular persons including the Council and in all the circumstances of the case the public interest in maintaining the exemptions outweighs the public interest in disclosing the information. 13.2 The Chair invited the five members of the Pension Board to continue observing the meeting. Item 14 was exempt from the press and public.
Councillors must say when they have a personal link to something being discussed, such as a job, a property or a family member. A prejudicial interest is one strong enough that the councillor usually leaves the room and takes no part.
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