Greenwich Council

Agenda, decisions and minutes

Venue: Committee Room 6 - Town Hall, Wellington Street, Woolwich SE18 6PW. View directions

Contact: Daniel Wilkinson  Email: daniel.wilkinson@royalgreenwich.gov.uk or tel: 020 8921 5102

Items
No. Item

1.

Apologies for Absence

To receive apologies for absence from Members of the Panel.

Minutes:

Apologies for absence were received from Councillor Olu Babatola.

2.

Urgent Business

The Chair to announce any items of urgent business circulated separately from the main agenda.

Minutes:

Resolved –

 

That Item 10 be taken as urgent business.

3.

Declarations of Interest pdf icon PDF 48 KB

Members to declare any personal and financial interests in items on the agenda.  Attention is drawn to the Council’s Constitution; the Council’s Code of Conduct and associated advice.

Additional documents:

Minutes:

Resolved –

 

That the list of Councillors’ memberships as Council appointed representatives on outside bodies, joint committees and school governing bodies be noted.

4.

Minutes pdf icon PDF 54 KB

Members are requested to confirm as an accurate record the Minutes of the Pension Fund Investment and Administration Panel meeting held on 27 July 2015.

 

No motion or discussion may take place upon the Minutes except as to their accuracy, and any question on this point will be determined by a majority of the Members of the body attending who were present when the matter in question was decided.  Once confirmed, with or without amendment, the person presiding will sign the Minutes.

Minutes:

Resolved -

 

That the minutes of the meeting of the Pension Fund Investment & Administration Panel held on 27 July 2015 be agreed and signed as a true and accurate record.

5.

Current Issues pdf icon PDF 52 KB

To note recent and ongoing developments relating to pooled investments, pensions tax relief and governance arrangements in relation to the Fund

Decision:

Noted recent and ongoing developments relating to pooled investments, pensions tax relief and governance arrangements in relation to the Fund

Minutes:

The report was introduced by the Finance Manager.

 

In response to questions from the Panel, the Finance Manager clarified KPMG were consultants and one of the things they would be looking at with regard to governance arrangements was increased separation of LGPS pension funds and their host authorities.  Information on their recommendation would be submitted to the Panel.

 

In response to questions from the Panel, the Head of Strategic Accounting replied that the next period for the triennial automatic enrolment was in 2016. He explained that the consultation on the structure of tax relief on pensions was across all work pensions both public and private; anyone could comment although there was a requirement to say on whose behalf they were responding.

 

Members requested that any proposed changes by the Government to the pension scheme should be communicated to members of the Fund.

Action: DoF

 

Resolved –

 

The recent and ongoing developments relating to pooled investments, pensions tax relief and governance arrangements in relation to the Fund be noted

6.

Fund Manager Performance to 30 June 2015 pdf icon PDF 54 KB

To note a report on the performance of the Pension Fund Managers for the period ending 30 June 2015 and to agree that the appendix be considered in closed session as exempt information

Additional documents:

Decision:

1.       Noted a report on the performance of the Pension Fund Managers for the period ending 30 June 2015.

 

2.       Agreed to consider the information detailed in the Exempt Appendix to the report in closed session under the provisions of the Local Government Act 1972, Schedule 12A, Paragraph 3 “Information relating to the financial or business affairs of any particular person (including the authority holding that information)”;

 

3.       Agreed that the information detailed in the Exempt Appendix to this report be not subsequently released to the press or public.

Minutes:

The report at the appendix was presented by the Senior Investment Consultant from Hymans Robertson.  He commented on the current market fluctuation. He noted that the temporary sale out of equities into cash had provided some protection for the Fund.

 

In response to a question from the Panel the Senior Investment Consultant confirmed that they had no concerns about the Fund Managers.

 

Resolved -

 

1.       Noted a report on the performance of the Pension Fund Managers for the period ending 30 June 2015.

 

2.       Agreed to consider the information detailed in the Exempt Appendix to the report in closed session under the provisions of the Local Government Act 1972, Schedule 12A, Paragraph 3 “Information relating to the financial or business affairs of any particular person (including the authority holding that information)”;

 

3.       Agreed that the information detailed in the Exempt Appendix to this report be not subsequently released to the press or public.

7.

Pension Fund Draft Quarterly Accounts pdf icon PDF 34 KB

To note the draft Pension Fund accounts for the period ending 30 June 2015

Additional documents:

Decision:

Noted the draft Pension Fund accounts for the period ending 30 June 2015

Minutes:

The report was introduced by the Finance Manager.

 

Resolved -

 

The draft Pension Fund accounts for the period ending 30 June 2015 be noted

8.

Environmental, Social and Governance Issues Update pdf icon PDF 71 KB

To receive an update on Environmental, Social and Governance issues

Additional documents:

Decision:

Noted a report on Environmental, Social and Governance issues

Minutes:

The report was introduced by the Finance Manager.  The Finance Manager reminded Members that the Fund was legally obliged to consider no other factor than investment return.

 

Members noted that the voting detailed in the appendix provided evidence that issues such as environmental matters and human rights, for example, were taken seriously by the Fund administrators.

 

Resolved -

 

That a report on Environmental, Social and Governance issues be noted

9.

Knowledge and Understanding Policy and Framework pdf icon PDF 47 KB

To agree the Pension Fund Knowledge and Understanding Policy and Framework and 2015/16 Training Plan.

Additional documents:

Decision:

Agreed the Pension Fund Knowledge and Understanding Policy and Framework and 2015/16 Training plan

Minutes:

The report was introduced by the Finance Manager.

 

Resolved –

 

That the Pension Fund Knowledge and Understanding Policy and Framework and 2015/16 Training plan be agreed

10.

London Collective Investment Vehicle pdf icon PDF 32 KB

To note the presentation given by the Chief Executive of the London Collective Investment Vehicle in relation to shareholder resolutions issued on 11 September 2015

Decision:

Noted the presentation given by the Chief Executive of the London Collective Investment Vehicle in relation to shareholder resolutions issued on 11 September 2015

Minutes:

The Panel received a presentation from the Chief Executive of the LGPS London Collective Investment Vehicle (CIV).  He highlighted the reasons behind the move towards a collective investment vehicle and the possible alternatives.  He detailed the timescales for the CIV’s launch.  He commented that the London Pension Fund Authority would not be included in the CIV.  He highlighted that the CIV would drive down fees and costs, and gave an example of the savings Greenwich could expect. He stressed that the CIV would not just be for procurement but would be fully authorised as investment fund managers; these functions would be delegated to start with, but later they might decide to have them in-house.  He added that knowledge would be shared across the component boroughs and there would be pan-London training for Members and Officers. 

 

In response to questions from the Panel, the Chief Executive CIV replied that the CIV had already made an impact on fees in that some fund managers were already looking at LGPS’s as a whole in determining fees. The CIV would be in a position to deal constantly with the fund managers and would have a greater review of matters; he clarified the process for selecting fund managers. He explained that the CIV could be paid for either by a service charge or a standard fee.  Holding in-house fund managers would incur a cost. The CIV would only have a small number of staff, and the constituent boroughs would be expected to help. He said that each borough had its own Statement of Investment Principles; the CIV would be a platform and they could have an ethical equity route.  It was noted that there was polarity across the London boroughs in terms of preference for ethical or less ethical investments. Comparing the two it was noticeable that more ethical investments tended to under-perform the less ethical ones. He commented that with regard to the three boroughs which were not presently involved it was expected that one had now voted to join, one was waiting to see what the Government was going to do, and the other was concerned about the impact on the market of the creation of the CIV.

 

The Chief Executive CIV further advised Members that regulatory capital, a pot of ring-fenced capital, was a requirement for the CIV.  Regulatory capital could be raised via issue of B class shares to every member borough.  The return would go to the company but boroughs would have three options with regard to the surplus: they could either leave it to accumulate; they could pay a dividend; or they could use it to pay CIV service charges.

 

In response to a Member’s question the Chief Executive CIV indicated it would be up to Members whether the dividend option then went into the Pension Fund or not.

 

The Chair thanked the Chief Executive CIV for his presentation. The Chief Executive CIV left the meeting.

 

The Fund Adviser indicated that they supported the move to join the  ...  view the full minutes text for item 10.