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Agenda and draft minutes

Venue: Kennet Room - County Hall, Bythesea Road, Trowbridge, BA14 8JN. View directions

Contact: Ben Fielding - Senior Democratic Services Officer  01225 718656, Email: benjamin.fielding@wiltshire.gov.uk

Items
Note No. Item

10.00am

41.

Apologies

To receive any apologies for absence or substitutions for the meeting.

Minutes:

No apologies for absence were received.

42.

Minutes of the Previous Meeting

To approve and sign the Part I minutes of the Committee meeting held on 2 March 2023.

Supporting documents:

Minutes:

The minutes of the meeting held on 2 March 2023 were presented for consideration, and it was,

 

Resolved:

 

To approve and sign the minutes as a true and correct record.

43.

Declarations of Interest

To receive any declarations of disclosable interests or dispensations granted by the Standards Committee.

Minutes:

There were no declarations of disclosable interests.

44.

Chairman's Announcements

To receive any announcements through the Chairman.

Minutes:

The Chairman ratified the election of Cllr Kevin Small as Vice-Chairman.

45.

Review of Actions arising from previous meetings

To review progress on any actions requested by the Committee in previous meetings.

Supporting documents:

Minutes:

The Committee received the recommendations from the Local Pension Board, which would be considered under the relevant agenda items.

 

The Committee reviewed the list of ongoing actions.

46.

Review of the Minutes of the Local Pension Board

To receive the minutes of the meeting of the Local Pension Board held on 1 February 2023. To review the summary of the recommendations made by the Board.

Supporting documents:

Minutes:

The Committee reviewed the minutes of the Local Pension Board meeting held on 1 February 2023, and it was,

 

Resolved:

 

To note the minutes of the Local Pension Board meeting on 1 February 2023.

47.

Public Participation

The Council welcomes contributions from members of the public.

 

Statements

If you would like to make a statement at this meeting on any item on this agenda, please register to do so at least 10 minutes prior to the meeting. Up to 3 speakers are permitted to speak for up to 3 minutes each on any agenda item. Please contact the officer named on the front of the agenda for any further clarification.

 

Questions

To receive any questions from members of the public or members of the Council received in accordance with the constitution.

 

Those wishing to ask questions are required to give notice of any such questions in writing to the officer named on the front of this agenda no later than 5pm on Thursday 16 March in order to be guaranteed of a written response. In order to receive a verbal response, questions must be submitted no later than 5pm onMonday 20 March. Please contact the officer named on the front of this agenda for further advice. Questions may be asked without notice if the Chairman decides that the matter is urgent.

 

Details of any questions received will be circulated to Committee members prior to the meeting and made available at the meeting and on the Council’s website.

Minutes:

No statements or questions were submitted.

10.05am

48.

Final valuation report

A presentation by Hymans Robertson of the final valuation report and review of the process, including the level of data quality.

Supporting documents:

Minutes:

The Committee received a presentation by Barry Dodds (Hymans Robertson) regarding the final valuation report and review of the process, including the level of data quality. The presentation covered the following matters, including but not limited to, an update on the 2022 Actuarial Valuation exercise, how assumptions had been used to predict what appropriate contribution rates would look like, that the sign off process was on track for the deadline of 31 March 2023, how the reported funding level had remained a similar level. Other elements included a discussion of the reconciliation of funding level, with investment returns higher than expected, an outline of the assumptions used as well as the consideration of climate change and the importance of the Rates and Adjustment Certificate.

 

The Chairman thanked Barry Dodds for his presentation.

 

After the presentation, the following questions and comments were raised by the Committee, including but not limiting to, what the what the present advice on climate risks was and whether this linked to estimates on profits for certain sectors or for the whole economy. It was clarified that there was no definitive way of modelling and that Hymans had considered the whole perspective rather than solely an investment perspective, modelling 5,000 different scenarios. Further clarity was provided that for the purposes of the project, predictions had been made for 10-20 years in the future as that would be when a lot of pension benefits would be paid out, therefore allowing for a better understanding of the risk involved and how returns might vary.

 

Further comments were made in relation to the assumptions made on CPI and how these were modelled on a 20-year period, clarity was sought that the spread of primary rates was typical with different membership profiles and that there was not a standout difference between the Wiltshire Pension Fund and others. Additional information was provided about obtaining a pensions assurance letter and that within the report there were some bodies with no secondary rate contributions and that this could be down to the funding level.

 

At the conclusion of discussion, it was,

 

Resolved:

 

The Committee noted the Valuation update provided, including the appendix and that the valuation report would be published.

The Committee noted that officers & the Scheme Actuary would distribute the valuation information as required.

10.45am

49.

Headlines and Monitoring (HAM)

Areport for the committee’s ongoing oversight of:

·        Scheme, Regulatory, Legal and Fund Update

·        Risk Register

·        Administration KPI update – 1 December 2022 to 28 February 2023

a)     Outsourcing update

b)     McCloud & Dashboard update

·        Fund Audits

a)     SWAP Audit update 2022/23

·        Training and effectiveness review update

 

Please note that Appendix 4 (Audit Actions Log) will be published as a later agenda supplement.

Supporting documents:

Minutes:

Jennifer Devine, Head of Wiltshire Pension Fund, supported by other officers presented the Headlines and Monitoring report. The report included consideration of the risk register, key performance indicators, and other updates to enable the Committee to monitor relevant aspects of the Fund. Information was also provided on the outsourced projects taking place by Hymans and Aon.

 

An update was provided on the collapse of the Silicon Valley Bank and how this would impact on Pension Funds, with reassurance provided that the Fund had not incurred any wider losses because of the event at this time.

 

The Committee discussed the risk register, with queries raised that the Committee had been receiving a different version of the register compared to the Board. It was noted that there was a slight difference in focus, with Committee Members wanting to see more strategic risks and that the Board would comment on risk ratings and make recommendations to the Committee. It was suggested that it could be positive if the items in the risk register could be time bound with indications of when risks could be resolved.

 

There was discussion regarding audit, with it noted that an internal audit had been completed in November 2022, which had seen an improvement from no assurance in March 2022 to limited assurance. Details were provided on the recommendations within the new action log. It was noted that actions with a target date 31 March had been completed and those with a target date of 30 April were nearing completion. Additionally, regarding the approval of the Business Plan, it was suggested that there might be changes to target dates based on the decisions of the committee.

 

Regarding the training and effectiveness review, which had been conducted by Hymans, Members were thanked were they had completed both reviews. Details were provided of the 2023/2024 training plan for approval of the committee. It was suggested that training should be conducted in an environment separate to that of a meeting.

 

An update was provided on Regulatory, Legal and Fund matters which had been remodelled in line with the strategic risks of the Fund.  It was noted that the Retained EU Law Bill would be considered during 2023 which had a sunset clause at the end of this year. During 2023 all EU laws would be reviewed by ministers, with a view to determining which would be retained or be no longer binding. It was anticipated that up to 4,000 pieces of legislation could affect pension Fund’s and officers would appraise themselves of legislation for consideration that might have an impact on how the pension Fund is run.

 

At the conclusion of debate, it was,

 

Resolved:

 

The Committee:


a) Approved the risk register recommendations made by the Board and the officer assessment of risk as presented in the February version of the risk register. Noting the request for time bound resolutions:


b) Approve the changes in SWAP Audit target dates, notably Action 7 within that actions log and those adjusted by the approval  ...  view the full minutes text for item 49.

11.05am

50.

Business Plan & Budget 2023/24, plus KPI Improvement Plan

The Head of Wiltshire Pension Fund will present the latest Fund Business Plan and Budget to Committee for approval. Part of the presentation will include details of a revised RI plan and training setting out the approach to the improvement plan and explaining the administration content impacted by the plan.

Supporting documents:

Minutes:

Jennifer Devine, Head of Wiltshire Pension Fund, presented the latest Fund Business Plan and Budget to Committee for approval. Part of the presentation included details of a revised RI plan and training setting out the approach to the improvement plan and explaining the administration content impacted by the plan.

 

The Chairman called the meeting to a break at 11.30am and then resumed at 11.35am.

 

The Committee discussed the report and presentation in detail, with the following comments received but not limited to whether the undertaken restructure could risk leading to another backlog, to which it was stated that the structure had been put in place to address issues. Additionally, though there was a risk in having to deal with the workload, the Business Plan aimed to approach objectives into chunks and deal with them in a priority order. Timescales were discussed with it suggested by officers that it would likely be a 2/3-year plan and that potentially this year it might be possible to commit to a time frame once the team was up and running.

 

The Committee further discussed the need to identify what work was a priority to then reduce KPIs, to which it was acknowledged that a hit squad would be set up to tackle this issue and clear records with a focus now on completing the higher priority ones. It was suggested that data indicated that there would not be enough resource, with it questioned what this would equate to in people, to which it was stated that Aon had looked at the data and suggested between 6-21 people, however it was strongly believed that at this stage, and additional people would be absorbed in the team and have limited impact.  Once efficiencies had been identified and new ways of working embedded, it would be possible to make a more accurate assessment of the resources required.

 

The Committee queried whether the budget of £3.6million was a realistic figure, to which it was clarified that it may not be, but should the Pension Fund request more money, then there would be a data driven business case for it. Additionally, reference was drawn to the priorities outlined in the report and that it would be positive to know at which point during the foundations stage officers would be able to see the end in sight.

 

At the conclusion of debate, it was,

 

Resolved:

 

The Committee:


a) Approved the Business Plan 2023/24, including the actions for the year.


b) Approved the Pension Fund budget for 2023/24 shown in Appendix 1 totalling £4.783m (0.16% of total fund value).

 

c) Agreed that a plan would be brought back to the meeting in 6-months’ time which would demonstrate timescales.

11.35am

51.

Key Financial Controls

Including the Budget Monitoring 2022/23 and the corporate recharge arrangements. To be presented by the Investment & Accounting team lead.

Supporting documents:

Minutes:

Chris Moore, Investment & Accounting team lead, provided a presentation on Key Financial Controls, including the Budget Monitoring 2022/23 and the corporate recharge arrangements.

 

The Committee discussed the report in detail, with the following comments received but not limited to that it was inconsistent for the Altair checks on the RAG rating to indicate no material concerns when there were major issues.

 

Additionally, the Chairman stated that he had been requested to attend the Audit and Governance Committee to discuss the SWAP rating of limited assurance. The Chairman discussed the protocols and procedures of the Audit and Governance Committee with it suggested and agreed that any questions for the Chairman be provided in writing, in advance of the meeting with the questions to also be circulated to the Pension Fund Committee.

 

At the conclusion of debate, it was,

 

Resolved:

 

The Committee agreed to use the report to monitor progress against resolving the issues which have been identified, and the progress made to develop accounting and control improvements.

11.45am

52.

Treasury Management Strategy:

The Investment & Accounting team lead will present the strategy for 2023/24 and a report summarising the performance to date during 2022/23.

Supporting documents:

Minutes:

Chris Moore, Investment & Accounting team lead, provided a presentation on the Treasury Management Strategy for 2023/24 which included a report summarising the performance to date during 2022/23.

 

The Committee discussed the report with clarity sought on the role of the Wiltshire Investment Team and the Investment Manager.

 

At the conclusion of debate, it was,

 

Resolved:

 

The Committee:

 

a) Approved the Treasury Management Strategy.


b) Noted the performance by the Council Treasury team to March 2022.

11.55am

53.

Divestment Statement

The Head of Wiltshire Pension will present a paper agreeing a position and statement regarding the topic of divestment.

Supporting documents:

Minutes:

Jennifer Devine, Head of Wiltshire Pension Fund, presented a paper agreeing a position and statement regarding the topic of divestment. The report featured a proposed revised statement following on from the meeting which took place on 23 March 2023.

 

The Committee discussed the report, with the following comments received as to whether it would still be possible for the Fund to have a presence in a company with fossil fuel activity, with it noted that the Fund would look at factors for companies such as emissions and scores for climate efficiency. It was suggested that there wasn’t an assessment of the financial implications of adopting the statement. Support for the statement was shown with officers thanked for their work following the previous Pension Fund Meeting to clarify the definitions included. Discussion took place regarding the primacy of financial concerns and that it was suggested that this was self-evident and embodied in consultation that took place.

 

At the conclusion of debate, it was,

 

Resolved:

 

The Committee approve the statement and supporting wording on fossil fuel divestment.

 

Councillor Christopher Newbury requested his vote in opposition to the resolution be noted.

12.05pm

54.

Stewardship Report

The Fund Investment & Accounting Officer will present plans for the draft stewardship report process and submission.

Supporting documents:

Minutes:

Liam Robson, Fund Investment & Accounting Officer presented plans for the draft stewardship report process and submission.

 

At the conclusion of the discussion, it was,

 

Resolved:

 

The Committee agreed that the final report may be submitted to the FRC following circulation via email.

12.15pm

55.

Committee Forward Work Plan

To review the work plan for the committee.

Supporting documents:

Minutes:

It was,

 

Resolved:

 

To note the Forward Work Plan.

56.

Date of Next Meeting

To determine the date of the next Committee meeting dates:

·        Investment focused meeting 15 June 2023

·        Administration focused meeting 13 July 2023

Minutes:

The dates of upcoming meetings were confirmed as 15 June 2023 and 13 July 2023.

57.

Urgent Items

Any other items of business which, in the opinion of the Chairman, should be considered as a matter of urgency. Urgent items of a confidential nature may be considered under Part II of this agenda.

Minutes:

There were no urgent items.

12.20pm

58.

Exclusion of the Public

To consider passing the following resolution:

 

To agree that in accordance with Section 100A(4) of the Local Government Act 1972 to exclude the public from the meeting for the business specified in Item Numbers 17-20  because it is likely that if members of the public were present there would be disclosure to them of exempt information as defined in paragraphs 1 & 3 of Part I of Schedule 12A to the Act and the public interest in withholding the information outweighs the public interest in disclosing the information to the public.

Minutes:

It was,

 

Resolved:

 

To agree that in accordance with Section 100A(4) of the Local Government Act 1972 to exclude the public from the meeting for the business specified in Minute Numbers 19 - 22  because it is likely that if members of the public were present there would be disclosure to them of exempt information as defined in paragraphs 1 & 3 of Part I of Schedule 12A to the Act and the public interest in withholding the information outweighs the public interest in disclosing the information to the public.

12.25pm

59.

Minutes of Previous Meeting

To approve and sign as a true and correct record the Part II (private) minutes of the previous meeting held on 2 March 2023.

Minutes:

The private minutes of the meeting held on 2 March 2023 were presented for consideration, and it was,

 

Resolved:

 

To approve and sign the minutes as a true and correct record.

60.

Local Pension Board minutes (Part II)

A review of the last Local Pension Board minutes (1 February 2023).

Minutes:

A review of the last Local Pension Board minutes (1 February 2023).The private minutes of the Local Pension Board meeting held on 1 February 2023 were presented for consideration, and it was,

 

Resolved:

 

To note the minutes as a true and correct record.

12.35pm

61.

Departmental Restructure

To receive an update from the Head of Wiltshire Pension Fund on the restructure implementation and recruitment.

Minutes:

Jennifer Devine, Head of Wiltshire Pension Fund, provided an update on the restructure implementation and recruitment.

12.45pm

62.

Brunel Governance Update

A verbal update on the report from officers summarising the ongoing Brunel governance arrangements.

Minutes:

Andy Brown, Corporate Director Resources, Deputy Chief Executive, and Treasurer to the Pension Fund, provided an update on the ongoing Brunel governance arrangements.

 

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