Apologies for absence were received from Annette McKenna, (Representing Admitted Bodies Employers), Roger Jones (Representing Pensions Fund Employers), with Michael Alderson substituting, and from Councillor Kyrsten Perry, Chair of the Pensions Committee.

There were no declarations of pecuniary interests made by members of the Board.

To confirm as a correct record of the proceedings the unrestricted minutes of the meeting of the Pensions Board held on 22^nd November 2021.

The unrestricted minutes from the 22^nd November 2021 meeting were AGREED and APPROVED to be an accurate record of the meeting.

To consider any written submissions from Fund Members/Stakeholders.

(Submissions must be received by the Clerk to the meeting no later than 5.00p.m. on the day before the meeting.)

There were no submissions made by fund members.

There were no submissions/responses from the Pensions Committee.

Ms Susan Black from Hymans Robertson gave a presentation on GDPR. Ms Black informed the Board that the GDPR regulations were introduced in 2018, however the Scheme Advisory Board had released updates in September 2021 and as such the LGPS Funds had been advised to use the updated templates they had provided.

Ms Black said the purpose of the GDPR regulation was to enhance individuals’ control and rights over their personal data, to simply the regulatory environment for international business and address the transfer of personal data outside the EU and EEA areas. She said the UK version of GDPR regulations closely followed the principles set by the EU and said there were penalties if companies did not follow the guidance. She said the Information Commissioners Officer (ICO) had a range of actions it could take if there was non-compliance. Ms Black said aside from the financial penalties and organisation risked reputational damage.

In terms of the Fund, Ms Black said the risk register already captured the failure to comply with the GDPR regulation as a potential risk and said a risk assessment had already been done, with a range of internal controls in place. She said the policies had been shared with employers however the other risk was cyber risk. Ms Black said that steps had been taken to address this, with officer training, risk workshops and regular Board updates being provided. She said the purpose of this was to ensure everyone was up to date with the latest information on GDPR compliance.

In response to comments and questions from the Board members the following was noted:

• Ms Black clarified organisations were obligated to report on GDPR breeches. She said if there was any under reporting the regulator would step in. She said where there had been large data breeches such as a cyber-attack the IOC would investigate this separately.
• In response to if the IOC were reactive in investigating breeches or if they are proactive, Ms Black said this was hard to say. They had been proactive. Ms Adams added the Pension scheme had to adhere to the Pensions Regulators code of practise and cyber risk was an important topic.
• Ms Adams clarified the Information and Governance Team within the Council had overall responsibility for GDPR. She said templates had been passed onto the team, who were happy with the documents. They had recommended the Council’s website should be updated to include the additional information.
• Ms Adams clarified the mandatory training was for all staff to complete. She said it was a refresh for staff, with further training workshops also being offered.
• In response to how compliance with data protection can affect the compliance with GDPR, Ms Adams stated considerable progress had been made over the past few years. She said they now had an employers’ forum and the I-connect system, whereby employers were required to upload information. She said there were still six employers who are not compliant however they were working with them to resolve this.  ...  view the full minutes text for item 6.1

Ms Miriam Adams, Interim Head of Pensions and Treasury introduced the report and stated this was the draft unaudited Statement of Accounts and Annual Report for the LBTH Pension Fund for year ending 31^st March 2021. She said the report was attached at appendix A. She said the audit of the Pension Fund Account had commenced and referred Board Members to page 8 of the supplementary agenda. Ms Adams referred to several sections within the report such as the performance of the Fund at page 17 of the agenda and the list of investment managers at page 18. She said the membership of the Fund fluctuates daily and said the changes in the market value of investments, page 39 of supplementary agenda, had been impacted due to Covid-19.

In response to comments and questions from Board members the following was noted:

• The Board commented on the thoroughness of the report and said this was truly comprehensive and commendable. They thanked Ms Adams and her team for producing the report.
• Referring the covering report and the introduction to the annual accounts report, Mr Thompson said that whilst they acknowledged the accounts to be true and fair statements, the accounts had not been signed off, for the last three years. He asked what progress had been made? Ms Adams responded stating the accounts for the Pension Fund were complete however the external auditors were not able to sign off the accounts or issue and opinion until the main accounts for the council, were completed.
• Mr Nisar Visram, Director for Finance, Procurement and Audit informed members that the Audit Committee had signed off the 2018/19 and 2019/20 accounts at their meeting in January 2022. He said the 2020/21 accounts were available in draft format online and he hoped these would be signed off shortly. He said the Pension side of the work was more stable, but there was this co-dependency with the Council accounts.
• In response to what the Pensions Regulators position was concerning the delay, Ms Adams said the regulator had been informed.
• In response to where the growth of assets had occurred, Ms Adams confirmed this was mainly due to the Baillie Gifford investments. She said equities had done extremely well. She said the returns from LGIM and the diversified group fund had also performed well but unfortunately the fixed income mandates had not done so well. She said the Pensions Committee had agreed to take out an Equity Protection Plan and said the windfall from this was £20m.
• Ms Adams confirmed that a training log was kept on the training attended by members of the Board and the Committee. She said additional training provided by CIPFA and LGA training is also sent to members, as well as third party training.
• Referring to administration costs, Mr Thompson asked if these were benchmarked against others, other than CIPFA? Ms Adams responded stating the Pension Fund has recently joined the CIPFA Benchmarking Scheme and said whilst this would be a big exercise,  ...  view the full minutes text for item 6.2

Ms Miriam Adams, Interim Head of Pensions and Treasury introduced the report and stated this was a government backed initiative which required the pensions industry to design and own the dashboard. She said the Pension Scheme Act 2021 received Royal Assent on the 11^th February 2021, and provided the legal framework to support pension dashboards, including powers to compel schemes to provide member information.

In response to comments and questions from Board members the following was noted:

• Mr Thompson said he noted this was a two-year project and said given the resource implications, what were the ‘critical bottlenecks’ referred to in the second recommendation of the report? Ms Adams responded stating the bottlenecks has been reported to the Board for quite a while; They related to the uploading of employer data. She said there was a project plan in place, whereby she was working with the six largest employers and was trying to get them to provide the data digitally via i-connect. She said if this was not resolved soon, the incoming data would create a bottleneck, in terms of meeting the deadline for setting up the Dashboard.
• Referring to paragraph 3.16 and the sentence “External support may be required”, Mr Thompson asked what support was to be provided and how was this to be monitored? Mr Visram replied stating the data issue were a significant challenge and as such they had used a ‘payroll consultancy’ to identify the risks. He said the recommendations and the action plan from the report were discussed at bi-weekly meetings but there were some system changes required and as such external support may be required because of the pressure to progress things quickly.

The Pensions Board RESOLVED to:

Note the recommendations being made to the Pensions Committee who were to consider this report at its meeting of 10^th March 2022.

The Pensions Committee is recommended to:

1. Note the requirement to improve the reliability of data in accordance with the Pensions Dashboards Programme data standards guide in order to supply the correct information to the dashboards and ensure compliance with the statutory staging timeline to onboard schemes.
2. Note the critical bottleneck the scheme faces in respect of council employee payroll data.

Mr John Jones stated the GDPR presentation had covered most of the points relating to the LGPS being GDPR compliant and therefore he did not intend to go through the report.

Ms Adams said the Board should note the documents referred to in the report as these would be shared with all the employers in the Scheme and would also be available on the Council’s website. 

The Pensions Board RESOLVED to:

Note the recommendations being made to the Pensions Committee who were to consider this report at its meeting of 10^th March 2022.

The Committee is recommended to:

1. Note the content of this report
2. Note the updated Full GDPR Privacy Notices and Employer’s Memorandum of Understanding issued by the LGA (Appendices 1-5).

Ms Miriam Adams, Interim Head of Pensions and Treasury stated this was a regular report that was presented to the Board and the Committee. She referred members to page 58 and 59 of the agenda and stated paragraph 3.1 listed the recommendations of the Pensions Regulator. Ms Adams went through the report referring to paragraph 3.3 and 3.4, the risks which required close monitoring. In particular, she referred to the McCloud judgement and said much depended on the regulations that the government would issue and how this will affect the Pensions Scheme.

In response to comments and questions from members of the Board the following was noted:

• Commenting on the risks, Mr Thompson said there were 5 red rated risks, 4 amber rated risks and 1 to Green. He said the Board needed to keep its focus on this as all the risks related to data quality.

• Mr Thompson asked for a fuller update in relation to the recruitment and retention of staff within the Pensions Team. Mr Visram responded stating the Head of Pensions and Treasury post was currently live to advert with a closing date for the end of March 2022. Ms Adams added there were currently four vacancies within the team, with some members of staff being on fixed term contracts and other posts being filled by agency staff.

• ACTION: The Chair requested a quick email be sent to Board Members on the number of vacancies outstanding which showed the number of full-time posts, how many were fixed-term posts and who was occupying the roles, in order for the Board to have a clearer and better understanding of the recruitment situation within the Team.

• Referring to investments at risk due to the Russia/Ukraine conflict in Europe, Ms Adams said a written update had been provided to the members of the Board and the Committee. She said Fund Managershad been contacted on the 23^rd February and she had spoken to LGIM who confirmed they had no investments in the low carbon fund in Russia and Ukraine. LCIV said the Ruffer and Baillie Gifford Funds had less than 0.01% of whole Fund assets invested. However, investments managers had also been asked to look at any indirect investments. Ms Adams said she would report back to the Board and Committee once this information was available.

• ACTION: Mr John Jones requested that Mr Colin Robertson, the Independent Advisor to the Pensions Committee, be invited to the next Pension Board meeting to make a presentation on asset allocation of investments and how and if investments in Russia are at greater risk than others. Councillor Ullah added that it would be sensible for Baillie Gifford to also attend the meeting to talk about their investments.
• ACTION: Ms Adams to send the Board members the Risk Management Policy, which the Board discussed at its meeting of 21^st November 2021.

The Pensions Board RESOVLED to:

Note the recommendations being made to the Pensions Committee who were to consider this report at its  ...  view the full minutes text for item 6.5

Ms Miriam Adams, Interim Head of Pensions and Treasury provided a verbal update in relation to the Governance Review. She said EON had sent a link to all members of the Board and Committee and would welcome responses as soon as possible. She said they had extended the deadline of 7^th March to allow for further responses.

o   ACTION: Ms Adams to send a copy of the review to Mr Michael Alderson, substitute member for Mr Roger Jones.

Ms Miriam Adams, Interim Head of Pensions and Treasury said no comment had been raised regarding the work plan and as such it appeared the Board and Committee were happy with this.

·       Mr Thompson said the document was excellent in that it was substantial and thoroughly researched. He said it was a campaigning document which had been a very good read.

The Pension Board RESOVLED to:

1.    NOTE the update provided by Ms Adams.

Ms Miriam Adams, Interim Head of Pensions and Treasury said the report provided members with information relating to the administration and performance of the Fund over the last quarter as well as an update on the key LGPS issues and initiatives which impact the Fund.

In response to comments and questions from members of the Board the following was noted:

• The Chair stated it was clear the Pensions Administration of the Fund was moving forward and said this was encouraging than what it was nearly a year ago.
• In respect to paragraph 3.7 and the table therein, the Chair asked if the actual number could be provided next to the percentages. Ms Adams said numbers were provided in the table at 3.2 however she would ensure they were linked, to provide further clarity.

The Pensions Board RESOLVED to:

Note the recommendations being made to the Pensions Committee who were to consider this report at its meeting of 10th March 2022.

The Pensions Committee is recommended to:

1. Note and comment on the contents of this report and appendix

In view of the contents of the remaining items on the agenda the Committee is recommended to adopt the following motion: “That, under the provisions of Section 100A of the Local Government Act 1972, as amended by the Local Government (Access to Information) Act 1985, the press and public be excluded from the remainder of the meeting for the consideration of the Section Two business on the grounds that it contains information defined as Exempt in Part 1 of Schedule 12A to the Local Government Act,1972.”

EXEMPT SECTION (Pink Papers)

The exempt committee papers in the agenda will contain information, which is commercially, legally or personally sensitive and should not be divulged to third parties. If you do not wish to retain these papers after the meeting, please post them to the Democratic Service Office, 1st Floor, Mulberry Place London E14 3BG or hold onto the papers until such time you can return to the Town Hall and dispose of the papers in the confidential bins.

The Chair MOVED and it was

RESOLVED

“That, under the provisions of Section 100A of the Local Government Act 1972, as amended by the Local Government (Access to Information) Act 1985, the press and public be excluded from the remainder of the meeting for the consideration of the Section Two business on the grounds that it contains information defined as Exempt in Part 1 of Schedule 12A to the Local Government Act,1972.”

To confirm as a correct record of the proceedings the restricted minutes of the meeting of the Pensions Board held on 22^nd November 2021 and to NOTE the restricted minutes of the Pensions Committee meeting of 25^th November 2021.

The Board members noted the restricted minutes of the Pension’s Board meeting of 22^nd November 2021 and had no comment to make in relation to the exempt items.

The Board AGREED and APPROVED the restricted minutes of 22^nd November 2021.

The minute for this item is restricted.

No other business was discussed by the Board Members, other than a few announcements and reminders.

·       The Chair reminded Board Members to complete the Hymans training package.

·       Mr John Gray, said he was on the taskforce looking at Social, Economic Diversity in the financial sector and said he would forward a survey to Ms Adams. He asked board members to complete the survey and attend a virtual meeting if possible.

·       Councillor Abdal Ullah expressed his thanks to the Board and said this was his last meeting, owing to the impending election. The Chair, Mr Jones thanked Councillor Ullah for his contribution over the time he had been a member of the Board.