Agenda and minutes
Venue: Committee Room One - Town Hall, Mulberry Place, 5 Clove Crescent, London, E14 2BG. View directions
Contact: David Knight, Principal Committee Services Officer Tel: 020 7364 4878 E-mail: david.knight@towerhamlets.gov.uk
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DECLARATIONS OF DISCLOSABLE PECUNIARY INTEREST To note any declarations of interest made by Members, including those restricting Members from voting on the questions detailed in Section 106 of the Local Government Finance Act, 1992. See attached note from the Monitoring Officer.
Minutes: Declarations were made by Ngozi Adedeji and Neville Murton with regards to item number 8. |
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Minutes of the meeting held on 24th September, 2019 To confirm as a correct record the minutes of the meeting of the Committee held on Minutes of the meeting held on 24th September, 2019. Minutes: Councillor Blake raised a point of accuracy with regards to the minutes. She said the first and second bullet point on page 14 of the agenda and reports pack should be reworded to say a discussion took place on the decarbonisation approach and that it should have been clarified that the decarbonisation approach outlined was one view of a consultant and a decision had not been made on an exclusionary approach. It was suggested the minute should be redrafted to provide the following information: what is the approach? what is the view of the consultants? and what was agreed at the meeting. Miriam Adams and Kevin Miles agreed to draft a paragraph to correct the minutes and share with the chair for approval.
RESOLVED: 1. The minutes of the meeting held on 24 September 2019 we approved as an accurate record subject to the above amendment. |
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PETITIONS To receive any petitions relating to matters for which the Committee is responsible. Minutes: None. |
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SUBMISSIONS / REFERRALS FROM PENSION BOARD To be received at the meeting Minutes: A report was tabled from John Jones Chair of the Pensions Board. The note highlighted the key issues that had been considered by the Board at its meeting on 25 November 2019.
RESOLVED: 1. To note the Chair of Pensions Board report. |
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REPORTS FOR CONSIDERATION |
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Equity Protection - Presentation and Training To follow Minutes: The Committee received an update from Jack Bladon and Pedro Moura (representatives from Schroders) on the funds equity protection. A presentation booklet was tabled at the meeting. |
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Quarterly Voting and Engagement Update for September 2019 To follow
Minutes: RESOLVED: 1. The Committee noted the report on Quarterly Voting and Engagement September 2019. |
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Report on Fund Liquidity To follow
Minutes: The Committee received the report of Mririam Adams (Interim Pension and Investment Manager) on Fund Liquidity.
The Committee were in agreement to sell Bailey Gifford in order to balance the funds risk portfolio. The Committee instructed finance officers to contact the London CIV on their behalf to initiate the process.
There was a suggestion that the fund could benefit in the long term if it paid out dividends. Officers were asked to contact the CIV to find out if there was an option to do this.
The Committee agreed that the cashflow appendix on page 97 of the pack was useful and requested the document be presented to the Committee on an annual basis including figures on income received.
ACTIONS: 1. Senior officers to contact the London CIV to sell Bailey Gifford. 2. Senior officers to contact the London CIV to find out if the fund could pay out dividends. 3. Senior officers to add Pension Fund Cash Flow Forecast to the committee forward plan to be reviewed on an annual basis.
RESOLVED: 1. To note the estimated cash flow deficit of £13m from operational activities (Appendix A). 2. Approve the recall of £2m dividend and rental from Schroders into the LBTH Pension Fund bank account to help meet the cost of in-year liabilities. 3. To approve the sale of Ballie Gifford equity investments £11m.
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Pensions Administration Quarterly update- Quarter End September 2019 To follow
Minutes: The Committee received the report of Neville Murton (Interim Corporate Director of Resources) and Miriam Adams (Interim Pension Manager), on the Pension Administration Quarterly Update – quarter ending September 2019.
The Committee RESOLVED to: 1. Note the contents of the report. 2. Note the identified regulatory breaches to be reported to the Pension Regulator. 3. Agreed to report the regulatory breaches to the Pensions Regulator 4. Note that a detailed remediation plan which has the deadlines for all actions, owners and up to date status will be provided to the Board in February 2020. |
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The Investment Consultancy and Fiduciary Management Market Investigation Order 2019 To follow
Additional documents:
Minutes: The Committee received the report of Neville Murton (Interim Corporate Director of Resources) and Miriam Adams (Interim Pension Manager), on the Investment Consultancy and Fiduciary Management Market Investigation Order 2019.
The Committee RESOLVED: 1. To note the contents of the report. 2. Consider the example investment consultant objectives 3. Note the legal requirement for trustees of occupational pensions (including the LGPS) to set objectives comes into effect from 10 December 2019 4. To consider the draft strategic objectives in relation to the provision of Investment Consultancy and Fiduciary Management Market Investigation Order 2019. 5. To delegate to the Director of Resources/Section 151 Officer in consultation with the Pension Committee Chair and Vice-Chair authority to agree final strategic objectives. |
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TRAINING EVENTS To note details of forthcoming Training Events Minutes: It was noted that a training needs assessment template had been circulated to Members. Members were encouraged by the Chair to complete the form and return to Miriam Adams.
RESOLVED: 1. To send completed training needs form to Miriam Adams. |
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ANY OTHER BUSINESS CONSIDERED TO BE URGENT To consider any other business the Chair considers being of an urgent nature. Minutes: Nil items |
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Investment and Fund Managers Performance Review for Quarter End September 2019 Additional documents:
Minutes: The Committee noted the report of Neville Murton (interim corporate director of resources) and Miriam Adams (Interim Pensions Manager), on the Investment and Fund Managers Performance Review for Quarter Ending September 2019.
The Independent Advisor highlighted key points from his quarterly commentary. These included: · Equity markets have gone up by 23% (S&P 500) and 27% (Nasdaq) so although equity markets were vulnerable the same could be said of other asset classes such as bond markets which appear even less attractive. · The funds equity weighting should be no greater than the strategic equity benchmark, funds with a cash plus return target such as diversified growth funds can provide a suitable home until other asset classes become more attractive. · Infrastructure was recommended as an asset class to invest in without delay. · Baillie Gifford had performed poorly this quarter and was underperforming by its benchmark by 1.5% over the last year and has contined to underperform. This could be attributed to Ballie Giffords philosophy for managing the fund which focuses on longer term themes such as technology which results in holding greater growth stocks as opposed to value stocks. This could be a case of waiting out the period of underperformance in the belief that longer term returns would be good, as they have been in the past. · It should be noted that the London CIV do not offer a ‘value’ fund and that the LCIV Sustainable Equity Fund has some similarities with the Ballie Gifford equity fund. · The London CIV appeared to be in crisis and was facing difficulties retaining or attracting suitable staff. The chief investment officer had resigned within weeks of joining the CIV and one of two senior managers was due to depart at the end of 2019. There were also concerns about the quality of monitoring reports which showed a limited ability in being able to look beyond what is being told by managers.
The Committee expressed concern at the report that the London CIV was experiencing a management crisis. The independent advisor advised against any new ventures with the CIV until the management issues had resolved. After meeting with the CIV he reported that they said they would work out the issues within six months however he advised that it should be noted that the CIV was on a ‘watch list’ due to internal management issues.
The Chair reported that previously the CIV advised that they had a limited demand for and supply of green investment funds but if there was demand they would be able to start research in the area. Since then she had met with Councillor Mark Engleby at Lewisham Council and they had formed a group of councils that would be interested in a green fund. Councillors in the group had received verbal confirmation from CIV officers that they were willing to look into starting a green option. However, given the independent advisors report, the Chair said there appeared to be a mixed signal on the London CIV’s capability to ... view the full minutes text for item 7.1 |
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EXCLUSION OF THE PRESS AND PUBLIC Minutes:
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EXEMPT/ CONFIDENTIAL MINUTES Minutes: There were not exempt minutes to review.
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Report on the Annual Allowance and the treatment of individual pension tax charges Minutes: The Committee received the report of Kevin Bartle (Interim Divisional Director of Finance) on Annual Allowance and the treatment of individual pension tax charges. |