Greenwich Council

Agenda and minutes

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

Contact: Jasmine Kassim  Email: jasmine.kassim@royalgreenwich.gov.uk tel 020 8921 5146

Items
No. Item

1.

Apologies for Absence

To receive apologies for absence from Members of the Panel.

Minutes:

An apology for absence was received on behalf of Councillor Olu Babatola.

2.

Urgent Business

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

Minutes:

There was no urgent business.

3.

Declarations of Interest pdf icon PDF 34 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.

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 51 KB

Members are requested to confirm as accurate records the Minutes of the Pension Fund Investment and Administration Panel meetings held on 26 June 2017 and 17 July 2017.

 

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.

Additional documents:

Minutes:

Resolved -

 

That the Minutes of meetings of the Pension Fund Investment & Administration Panel held on 26 June 2017 and 17 July 2017, be agreed and signed as true and accurate records.

5.

Implementation of the Markets in Financial Instruments Derivative Report pdf icon PDF 71 KB

The Panel is required to note the potential impact on the investment strategy of becoming a retail client with effect from 3rd January 2018.  To note and agree to forgo the protection available to retail client status by electing for professional client status (attached as Appendix 1). To agree the immediate commencement of applications for elected professional client status with all relevant institutions, in order to ensure it can continue to implement an effective investment strategy.  To agree and approve delegated responsibility to the s.151 officer for the purpose of completing the application form and determining the basis of the application as either full or single service.

 

Additional documents:

Minutes:

The Acting Finance Manager presented the report to the Panel, outlining the impact of the implementation of the Markets in Financial Instrument Directive 2014/65 (MiFID 11).

 

The Panel noted the report, together with a request to agree the recommendation for continuation of professional client status on behalf of the Council.

 

Commenting on the report, the Panel made some enquires and received clarification from the Acting Finance Manager that the requirements for obtaining professional client status used to be automatic.  However, under the current provision, local authorities would be classed as automatic retail client, and would have to acquire a professional status.

 

The Acting Finance Manager also confirmed to the Panel that it would be beneficial for work to commence on the application sooner, in order for the Council to continue under the professional client status in time, as a change in status could result in a significant financial risk to the Pension Fund.  It was stated that should a decision be made for the Council to continue, it would have to meet the requirements of both qualitative and quantitative tests based on criteria set by the financial institution.

 

The Panel noted the clarification and

 

Resolved –

 

1.            That the potential impact on the investment strategy of becoming a retail client with effect from 3rd January 2018, be noted.

 

2.            That it be agreed to forgo the protection available to retail client status by electing for professional client status (attached as Appendix 1 to the report).

 

3.            That recommendation for the immediate commencement of applications for elected professional client status with all relevant institutions, in order to ensure it can continue to implement an effective investment strategy, be agreed.

 

4.            That it be agreed to delegate responsibility to the s.151 officer for the purpose of completing the application form and determining the basis of the application as either full or single service.

6.

Statement of Compliance with UK Stewardship Code pdf icon PDF 72 KB

The Panel is required to agree the Statement of Compliance with the UK Stewardship Code for Institutional Investors.

 

Additional documents:

Minutes:

In considering the report presented by the Acting Finance Manager, the Panel received clarification that the Royal Borough of Greenwich was fully compliant with the requirements of the UK stewardship code in regards to the Council’s Pension Fund.  The Panel

 

Resolved –

 

That the Statement of Compliance with the UK Stewardship Code for Institutional Investors, be agreed.

7.

Fund Manager's Performance to 30 June 2017 Report pdf icon PDF 86 KB

The Panel to note a report on the performance of the Royal Borough of Greenwich Pension Fund’s (‘the Fund’) investment managers for the period ending 30 June 2017.  To consider the information detailed in the Exempt Appendix to this 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)”; agree that the information detailed in the Exempt Appendix to this report be not subsequently released to the press or public.

 

Additional documents:

Minutes:

On behalf of the Panel, the Chair, Councillor Don Austen, announced that presentation of this item would take place in a ‘Closed Session’, as exempt information under the provisions of the Local Government Act 1972, Schedule 12A, Paragraph 3 would be considered.  The public and others of no concern left the room, and were not present during the presentation and consideration of the report.

 

The Panel received a report about the performance of the Pension Fund presented by Aidan McLoughlin, a representative of the investment consultant Hymans Robertson LLP. 

 

Commenting on the report, the Panel was pleased to noted that the Council’s Pension Fund outperformed the benchmark set within the reporting period, in spite of a rise in inflation in the second quarter of 2017.  The Panel also welcomed information that no significant risks had been reported for the period ending 30 June 2017 in regard to the Pension Fund.

 

Resolved –

 

1.            That the report on the performance of the Royal Borough of Greenwich Pension Fund’s (‘the Fund’) investment managers for the period ending 30 June 2017, be noted.

 

2.            The it be agreed that the information detailed in the Exempt Appendix to the report be not subsequently released to the press or public.

8.

Investment Strategy Statement Report pdf icon PDF 57 KB

The Panel is required to agree the Investment Strategy Statement (ISS) – attached as Appendix A to the report.

Additional documents:

Minutes:

In his presentation, the Acting Finance Manager advised the Panel that there had been no change as at March 2017 in relation to the Council’s position as set out in the Investment Strategy Statement attached as an appendix to the report.

 

In response to a concern, the Assistant Director (Corporate Finance & Deputy S151 Officer) clarified to the Panel that Fund Managers were obligated to comply with the Government’s policy in regard to management of the Pension Fund.  Thus, there should be no reason for the Council not to comply with the Fund Manager’s guidance on similar issues.

 

Resolved –

 

That the Investment Strategy Statement, attached as Appendix A to the report, be agreed.

9.

Fund Manager Presentation- Partners Group pdf icon PDF 54 KB

The Panel is required to receive a presentation from Partner Group providing an update on the Pension Fund’s Diversified Alternative mandate.

 

Minutes:

Resolved –

 

That an update on the Pension Fund’s Diversified Alternative mandate by Partner Group be deferred, as there was no prior statutory notification that the presentation contained exempt information 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)”.

10.

Training Report pdf icon PDF 49 KB

The Panel to receive training from Hymans Robertson on Financial Markets and product knowledge.

Minutes:

Resolved

 

That training from Hymans Robertson LLP on Financial Markets and product knowledge, be noted.