Agenda and minutes

Pension Board
Wednesday, 4th July, 2018 10.00 am

Venue: Civic Offices, St Nicholas Way, Sutton, SM1 1EA

Contact: Sharon Major, Committee Services Officer  Tel.: 020 8770 4990, Email:

No. Item


Apologies for absence


There were no apologies for absence received.


Declarations of interest


9. CIPFA Proposals for LGPS Reporting


Mike Ellsmore, Non Pecuniary, role of Chair on the working group concerned.



Minutes of the Previous Meeting pdf icon PDF 86 KB

To approve as a correct record the Minutes of the meeting held on 2 May 2018.


RESOLVED: that the minutes of the meeting held on 2 May 2018 be agreed as an accurate record.


Training Plan pdf icon PDF 108 KB

This report sets out the background to the training policy and plan that has been developed for both the Pension Board and Pension Committee for 2018/19. The training plan set out at Appendix B is a first draft which will be revised to reflect Pension Committee and Pension Board member input and the information received back from the Knowledge and Skills survey that new members of the Pension Committee will be asked to complete.


Additional documents:


Paul Audu, Investment, Insurance and Commercial Manager, presented the report.


The Independent Chair, Mike Ellsmore, was interested in the idea of joint training with the Pension Committee and asked that this be explored. Pension administration key performance indicators were also highlighted as key by the Chair and this was suggested as a development topic for December’s board meeting. Board members would also be invited to meet the pension administration team.


The Chair drew board members’ attention to the availability of a CIPFA Guide for local pension board members and suggested that Lyndsey Gamble, Head of Investment, Risk and Commercial Finance might look into it.


Board members discussed the different requirements of committee members and the board, given their distinct roles. Members also requested that there be a report on Additional Voluntary Contributions (AVCs) at a future meeting.


RESOLVED: that the pension fund training policy and plan, as set out in Appendix A and Appendix B, be agreed.


Review of Pension Board Terms of Reference pdf icon PDF 108 KB

The initial terms of reference for the Pension Board were agreed at its first meeting on 15 July 2015. These were then reviewed after one year of operation at the Board on 6 July 2016. Minor changes were made at that time. In line with agreed review requirements, following a further two years of operation, it is recommended that the board again review the terms of reference and consider whether any changes are required. The current Terms of Reference are attached at Appendix A.

Additional documents:


Lyndsey Gamble, Head of Investment, Risk and Commercial Finance, presented the report.


Following a discussion on expenses, the Head of Investment, Risk and Commercial Finance, agreed to look into the policy as per the existing terms of reference. Board members also enquired as to how vacancies on the Board are advertised and recruited to.


Board members suggested that the following changes be considered:

·         The length of the term of office be extended to three years.

·         That meetings be held in the daytime.


RESOLVED: That the Board considered changes to the Pension Board terms of reference.


Quarterly Investment Performance Report pdf icon PDF 319 KB

This report shows the performance of the Pension Fund Investment Managers for the quarter ending 31 March 2018, performance in the last twelve months, annualised rolling three year performance against target benchmark and performance since inception.


Appendix B included in the Exempt Agenda Supplement


Additional documents:


Lyndsey Gamble, Head of Investment, Risk and Commercial Finance, presented the report. The officer explained that the reduction in fund value illustrated in paragraph 4.3, although concerning, was temporary.


In particular, board members looked at total fund and pooled multi-asset performance in the longer term. The Head of Investment, Risk and Commercial finance offered to provide greater context for property performance following the meeting.


Board members advised that the Pension Committee may wish to consider the inclusion of three year performance figures for property and diversified growth funds (DGFs).


Michael Curran, Member Representative, raised the underperformance of BlackRock in the context of paragraph 9.3, and the selling of an asset above market valuation, for discussion.


RESOLVED: That the performance of the Pension Fund Investment Managers be noted.


Pension Administration Update pdf icon PDF 104 KB

The Pension Committee, at its meeting on 18 June 2018, received a pension administration update report. That report is attached and is presented to the Board for noting.

Additional documents:


Bradley Peyton, Head of Insurance, Pensions and Records Management (Interim), presented the report. With regards to complaints, the officer updated that the Ombudsman had upheld the Council’s position in respect of a complaint which had been referred. The Independent Chair requested that explanatory descriptions be provided for the key performance indicators in paragraph 4.16 in future.


Michael Curran, Member Representative, raised his concerns with regards to the number of people accessing their statements online. The officer agreed to clarify the figures provided while board members debated whether a paperless approach was right in the context of the important nature of pensions, expressing concern at reputational risk given the low-level of take-up. Board members stated their support in principle but given the low take up asked that the paperless approach be re-considered.


Board members examined the capacity of the pension administration team and the officer reported that a review would be underway shortly as a key priority and this would include a benchmarking exercise. Temporary recruitment was explained to be a challenge in terms of managing resources to which board members responded that they would strongly support an increase in permanent staffing given the extra pressures from running the CARE scheme and the large number of employers in the fund. The Board also discussed the benefit of site visits to the team.


RESOLVED: that the Pension Administration report be noted.


Scheme Advisory Board Annual Report 2017 pdf icon PDF 115 KB

This report introduces the 2017 Scheme Advisory Board annual report. It provides a number of highlights on the LGPS using information from 90 fund annual reports. The key highlights for 2017 are listed within the report below.



The report was taken as read by board members, following a brief explanation by the Independent Chair.


RESOLVED: That the Annual Report produced by the Scheme Advisory Board be noted.


CIPFA Proposals for LGPS Reporting pdf icon PDF 113 KB

In May 2018, CIPFA published ‘Proposals for LGPS Fund Reporting in a ‘Pooled World’’. The proposals are designed to support a number of objectives including the improvement of reporting on costs in line with the Scheme Advisory Board (SAB) Code of Transparency for asset managers, initiatives under consideration by the Financial Conduct Authority (FCA) and Department for Works and Pension (DWP) all aiming to create a comprehensive and transparent reporting standards for providers and trustees.


The report was taken as read by board members, following a brief explanation by the Independent Chair.


Lyndsey Gamble, Head of Investment Risk and Commercial Finance, explained the impact of the CIPFA proposals on future council operations and the 2018/19 annual report.


RESOLVED: that the recent paper from CIPFA on proposals for LGPS Funding Reporting was noted.


Review of Work Programme pdf icon PDF 107 KB

This report discusses the proposed work programme for the Board for the reminder of financial year 2018-19.



Lyndsey Gamble, Head of Investment Risk and Commercial Finance, discussed the work programme for the Board for the remainder of the financial year 2018/19. Board members suggested the following additions:


-           Additional voluntary contributions (AVCs) report

-           Section 13 report

-           Risk register quarterly reporting

-           December development: Pension administration


The officer explained that with regard to the risk register, its content would be reviewed and referred to the programme of the October meeting. Ashley Thomas, Employer Representative, recollected that the board had requested to look at the ‘top 5’ risks at each meeting.


RESOLVED: That the work programme for the Board for the coming year was considered and agreed.


Any Urgent Business

The Chair must approve the reason for urgency.


No urgent business was raised.