Pension Sub-committee And Pension Board - 23/11/2009

At a MEETING of the SUPERANNUATION INVESTMENT SUB-COMMITTEE OF THE POLICY AND RESOURCES COMMITTEE held at Dundee on 23rd November, 2009.

APPENDIX II

Present:-

BAILIES

COUNCILLORS

Bailie Willie SAWERS, Convener, in the Chair.

Unless marked thus * all items stand delegated.

I APOLOGIES AND SUBSTITUTES

Apologies had been submitted by Councillor Kevin Keenan and Mr Rod McKay, UNISON.

II MINUTE OF MEETING OF 17TH AUGUST, 2009

The meeting of the Superannuation Investment Sub-Committee of 17th August, 2009 was submitted and approved.

III SOCIALLY RESPONSIBLE INVESTMENT - SIX MONTHLY REPORT

There was submitted Report No 553-2009 by the Director of Finance reviewing the progress by the Fund Managers regarding the positive engagement policy on Environmental, Social and Corporate Governance approved by the Sub-Committee on 17th November, 2008.

The Sub-Committee noted the information contained within the report with regard to the activities of the Fund Managers during the six month period ended 30th September, 2009.

IV PROPOSED TIMETABLE OF MEETINGS FOR 2010

There was submitted Report No 554-2009 by the Director of Finance proposing a suggested programme of meetings of the Superannuation Investment Sub-Committee to cover investment performance and issues arising in 2010.

The Sub-Committee agreed the proposed programme of meetings as detailed below:-

NOTE

All meetings to commence at 12 noon.

V SEMINAR - BAILLIE GIFFORD LOCAL AUTHORITY SEMINAR AND TRAINING - EDINBURGH 6TH/7TH OCTOBER, 2010

The Sub-Committee noted that Baillie Gifford would be providing a seminar "A Time of Change" for members, officers and advisers. The Sub-Committee agreed that all members interested in attending this event could attend having noted that the seminar would be free but there would be travel and subsistence costs.

The Sub-Committee resolved under Section 50(A)(4) of the Local Government (Scotland) Act 1973 that the press and public be excluded from the meeting for the undernoted items of business on the grounds that they involved the likely disclosure of exempt information as defined in paragraphs 4, 6 and 11 of Part I of Schedule 7A of the Act.

VI TAYSIDE SUPERANNUATION FUNDS

(a) PERFORMANCE SUMMARIES

There was submitted Report No 555-2009 by the Head of Finance relating to Performance Summaries for various periods to 30th September, 2009 and also considering the performance of the Transport Fund which shared two of the managers.

The report compared investment performances of the Funds with the Funds' specific benchmarks which consisted of various stock market indices.

The Sub-Committee noted the information contained therein with regard to the performance of the Tayside Superannuation Fund and Tayside Transport Superannuation Fund and their Fund Managers.

(b) PERFORMANCE SUMMARY (PROPERTY PORTFOLIO)

There was submitted Report No 556-2009 by the Head of Finance relating to Schroder Property Investment Management Ltd performance for the various period to 30th September, 2009 reviewing the investment performance of the Property Portfolio managed by Schroder Property Investment Management Ltd, for the periods to 30th September, 2009.

The report also compared investment performances with an appropriate benchmark the HSBC/IPD Pooled Property All Balanced Funds Median.

The Sub-Committee noted the information contained therein with regard to the performance of the Property Portfolio managed by Schroder Property Investment Management Ltd.

(c) SUMMARIES OF INVESTMENTS AND TRANSACTIONS

There was submitted Report No 538-2009 by the Director of Finance summarising investments and transactions during the period 1st July to 30th September, 2009 reviewing the investment activities of the Main Fund's five Fund Managers for the quarter to 30th September, 2009. The Transport Fund shared three of these managers and their transactions were included.

The report also summarised the transactions of each Fund Manager and shows the market values of the Main and Transport Fund.

The Sub-Committee noted the information contained therein with regard to the activities of the Tayside Superannuation Fund and Tayside Transport Superannuation Fund and their Fund Managers.

(d) QUARTERLY FUNDING REPORT

There was submitted Report No 557-2009 by the Director of Finance which considered a report by Barnett Waddingham reviewing the current funding level of the Funds as assessed by Barnett Waddingham, the Fund Actuary.

The Sub-Committee noted the report by Barnett Waddingham.

VII REVIEW OF STRUCTURE OF MAIN FUND

There was submitted Report No 558-2009 by the Director of Finance following on from Report No 264‑2009, 18th May, 2009, which considered the Hymans Robertson paper 'Review of Structure - Main Fund'.

The Sub-Committee agreed that the suggestion of a 10% movement to alternatives was not appropriate at this time. The Sub-Committee also agreed that a 25m commitment to the M & G UK Financing Fund be made.

VIII REVIEW OF PERFORMANCE

David O'Hara of Hymans Robertson reviewed the performance of the Funds and the individual managers over the year.

The presentation covered the performance of both Funds and the five individual managers. It was noted that over the last year the results of managers employed had been mixed but that the recent recovery in markets provided relief for the Fund.

The Convener thanked the speaker for his presentation.

IX PRESENTATION

Nick Birchall and James Griffin of Fidelity gave a short presentation.

Nick Birchall noted that the last 15 months had been extremely volatile and that the different portfolios had had varying degrees of success with UK equities providing a relatively strong performance due to the defensive position in the fourth quarter of 2008.

Thereafter, Nick advised members that James Griffin would be taking over from Sam Morse as the Fund Manager - UK equities. James provided members with a brief outline of this experience to date and how this would benefit the growth of the Fund.

The Convener thanked the speakers.

Willie SAWERS, Convener.