Venue: Council Chamber, County Hall, Glenfield
Contact: Miss C Tuohy (0116 305 5483). Email: cat.tuohy@leics.gov.uk
Note: Members of the public wishing to watch the meeting can access the webcast via the following link: https://www.youtube.com/channel/UCWFpwBLs6MnUzG0WjejrQtQ
No. | Item |
---|---|
Chairman's Announcements. Minutes: Cllr Ratilal Govind The Chairman reported with great sadness the death of Local
Pension Committee member, Cllr. Ratilal Govind. Cllr Govind had been elected to
Leicester City Council in 2015, representing Evington Ward. Members joined the Chairman in silent tribute to Cllr.
Ratilal Govind. Clare Scott The Chairman reported that Clare Scott had stepped down from
her role as Independent Advisor to the Fund, and Members joined the Chairman in
passing on their best wishes to Clare. Jackie Dean Members joined the Chairman in passing on their best wishes
to Ms. J. Dean for her work on the Local Pension Committee following her
decision to not stand for a following term at the December Annual General
Meeting. |
|
Minutes of the meeting held on. 26 November 2021. PDF 189 KB Minutes: The minutes of the meeting held on 26 November 2021 were taken as read, confirmed and signed. |
|
Question Time. Minutes: The Chief Executive reported that no questions had been received under Standing Order 34. |
|
Questions asked by members under Standing Order 7(3) and 7(5). Minutes: The Chief Executive reported that no questions had been received under Standing Order 7(3) and 7(5). |
|
To advise of any other items which the Chairman has decided to take as urgent elsewhere on the agenda. Minutes: There were no urgent items for consideration. |
|
Declarations of interest in respect of items on the agenda. Minutes: The Chairman invited members who wished to do so to declare any interest in respect of items on the agenda for the meeting. No declarations were made. |
|
Presentation of Petitions under Standing Order 35. Minutes: The Chief Executive reported that no petitions had been received under Standing Order 35. |
|
Pension Fund Policy Report. PDF 307 KB Additional documents:
Minutes: The Committee considered a report of the Director of
Corporate Resources on updates to Fund policies and strategies. A copy of the report
marked ‘Agenda Item 7’ is filed with these minutes. In response to a question the Pensions Manager informed the
Committee that a prescriptive list for the distribution of death grant could
create more issues due to its complicated nature. Members noted that where
necessary the Fund took legal advice on individual cases. Cohabitees were defined as two
people who were unmarried, or not in a civil partnership living together in a
long-term relationship for at least two years. The Fund ensured that as part of
the Death Grant process relevant individuals signed a declaration that they met
the relevant requirements under legislation. Members recognised there would
always be challenges and different queries on such matters, but that the Fund
would look to resolve any conflict amicably. The right of appeal also existed,
under which those unhappy with a decision could approach the Ombudsman to
appeal. RESOLVED: a)
That
the report be noted. b)
That
the revised Administration and Communication Policy be approved; c)
That
the Distribution of Death Grant Policy be approved; d)
That
the Over and Underpayment Policy be approved; e)
That
the Investment Advisor Objectives be approved. |
|
Responsible Investment Plan 2022. PDF 429 KB Additional documents: Minutes: The Committee considered a report of the Director of
Corporate Resources regarding the Fund’s proposed Responsible Investment Plan 2022.
A copy of the report marked ‘Agenda Item 8’ is filed with these minutes. Arising from the discussion the following points were raised:- i.
The development of the Fund’s Climate Strategy
would feed into the Fund’s 2023 review of the
Strategic Asset Allocation. ii.
In response to a question on whether the Fund
lagged other schemes in development of the Climate Strategy, the Director
reassured the Committee that the Fund already took climate change into account. iii.
It was for the Committee to decide how
all-encompassing they wished the Climate Strategy to be, considering the
varying approaches taken by LGPS funds. It was not felt appropriate to rush a
strategy that the Committee did not have full ownership of. iv.
It was requested that the Climate Strategy
looked to act in respect of COP26 outcomes, and that it had palpable outcomes
and goals. RESOLVED: That the Responsible Investment Plan 2022 be approved. |
|
Overview of the Asset Strategy and Structure. PDF 705 KB Minutes: The Committee considered a report of the Director of Corporate Resources regarding the overview of the Fund’s Asset Strategy and Structure. A copy of the report, marked ‘Agenda Item 9’ is filed with these minutes. RESOLVED: That the overview of the Fund’s Asset Strategy and Structure be noted. |
|
Date of next meeting. The next meeting of the Committee is scheduled to take place on Friday 25 March 2022 at 9.30am. Minutes: That the next meeting of the Committee take place on 25 March 2022 at 9.30am. |
|
Exclusion of Press and Public. The public are likely to be excluded during consideration of the remaining items in accordance with Section 100(A)(4) of the Local Government Act 1972 (Exempt Information). Minutes: RESOLVED: That under Section 100A of the Local Government Act 1972, the
public be excluded for the remaining item of business on the grounds that it
involves the likely disclosure of exempt information as defined in Paragraphs 3
and 10 of Part 1 of Schedule 12A of the Act and that, in all circumstances of
the case, the public interest in maintaining the exemption outweighs the public
interest in disclosing the information. |
|
Annual Review of the Asset Strategy and Structure. Minutes: The Committee considered an exempt report of the Director of
Corporate Resources concerning the annual review of the Fund’s Asset Strategy and
structure. A copy of the report marked ‘Agenda Item 13’ is filed with these
minutes. The report was not for publication by virtue of paragraphs 3
and 10 of Schedule 12A of the Local Government Act 1972. Representatives from the Fund’s Investment Advisor Hymans
Robertson provided a Market Update to the Committee and highlighted that returns had mostly returned to normal
pre-pandemic level by the end of 2021. Following the presentation, the following points arose: i.
The long-term impact of the United Kingdom’s
Exit from the European Union remained unclear, which was reflected in the
activity of the markets such as UK Equity which had seen some strain, as
markets did not react well to uncertainty. ii.
Returns the Fund had generated were comfortably
ahead of the required return as assumed by the Fund’s Actuary at the valuation
in 2019. iii.
The Director clarified that it was normal to
take more risk than strictly required to generate the projected returns by the
Actuary. Some excess risk was prudent to provide downside protection, and
balance employer contributions. The Fund would consider its targets as part of
the 2022 valuation exercise, and any material changes would be considered as
part of the 2023 asset strategy review, however no significant changes were expected.
iv.
The Fund already made positive investments in
relation to climate change, such as its investment in timber with Timberland,
the assets of which were low and potentially negative regarding carbon
emissions within the infrastructure asset class. v.
More broadly within Infrastructure it was
evident there was key reliance on concrete and steel, a significant carbon
emitter. Nevertheless, when looking at the larger picture the resources were
necessary in the creation of the renewable energy sector in the development of
onshore and offshore wind farms and solar farms. Such developments created
substantial carbon in construction, however, over its 30
or 40 year lifespan it was extremely beneficial regarding decarbonisation.
The focus of the Fund would be shaped by the Fund’s Climate strategy where
possible in considering such factors. vi.
In relation to a question regarding the
Fund’s willingness to invest in social
infrastructure in the locality with the aim of helping local authorities, the
economy and community. The Director informed the Committee that the Fund was
limited to local investment 5% of its total Fund, and that there were several
issues which restricted it due to conflicts of interest, and the Fund’s
inability to use social good factors to reduce financial return due to its
fiduciary duty to employers and scheme members. Furthermore, the Fund would be
required to develop a bespoke arrangement with an Investment Manager to
facilitate such investments which would be higher cost compared to existing
investments. vii.
Members noted that the Fund’s Investment
Managers tended to have broad global areas they invested in, and that they had
an obligation to consider all opportunities if it is the best investment in the
Fund’s interest. If that was in the local area, then there would not be
anything stopping the Investment Manager committing capital to that
opportunity. RESOLVED: a)
That
the outcome of the review on the Annual Asset Strategy be noted. b)
That
the proposal to maintain the allocation as agreed on 22 January 2021, be
approved. c)
That
the Director of Corporate Resources review the following asset classes and
submit the outcomes to future meetings of the Committee or Investment
Subcommittee. i. Listed Equity ii. Targeted Return iii. Infrastructure iv. Property v. Distressed Debt ... view the full minutes text for item 114. |