Pension Sub-committee And Pension Board - 18/03/2024

At a JOINT MEETING of the PENSION SUB-COMMITTEE of the CITY GOVERNANCE COMMITTEE AND THE PENSION BOARD held remotely on 18th March, 2024

Present:-

PENSION SUB-COMMITTEE

BAILIE Kevin KEENAN

COUNCILLORS

Steven ROME

PENSION BOARD

Councillor Steven ROME, in the Chair.

I DECLARATION OF INTEREST

No declarations of interest were made.

II APOLOGIES

The Sub-Committee and Board noted apologies had been received from Bailie Sawers, Claire Shepherd and Raymond Boyd.

III MINUTE OF PREVIOUS MEETING

The minute of meeting of 11th December, 2023 was submitted and approved.

IIIa CHAIR OF PENSION BOARD

There was submitted Agenda Note AN9-2024 advising that in accordance with the Public Service Pensions Act 2013, the Sub-Committee were asked to seek nominations for the post of Chair of the Pension Board for the period of 12 months. The post of Chair of the Pension Board was subject to annual change by the regulations.

The Sub-Committee and Board agreed that Councillor Bill Duff be Chair of the Pension Board for this period.

IV TAYSIDE PENSION FUNDS RISK REGISTER

There was submitted Report No 89-2024 by the Executive Director of Corporate Services seeking approval for the Quarterly Risk Register for Tayside Pension Fund which was updated on 13th February, 2024, noting the changes to risk profile since the previous report.

The Sub-Committee and Board:-

(i)                     approved the Quarterly Risk Register for Tayside Pension Fund, noting the following revision made:

Risk 17 Lack of expertise on Pension Committee, Pension Board or amongst officers.

V TAYSIDE PENSION FUND PROCUREMENT POLICY

There was submitted Report No 71-2024 by the Executive Director of Corporate Services setting out the minimum standard and requirements for managing outsourcing and third-party service providers across the key stages of the outsourcing lifecycle, and the criteria for assessing value for money of the functions and activities that are outsourced to third parties.

The Sub-Committee and Board:-

(i)                     approved the policy noting that it was subject to annual review and that there were no changes.

VI PENSION ADMINISTRATION PERFORMANCE QUARTERLY UPDATE TO31ST DECEMBER, 2023

There was submitted Report No 73-2024 by the Executive Director of Corporate Services providing information on the recent quarters operational performance in relation to Pension Administration.

The Sub-Committee and Board:-

(i)                     noted the content of the report.

VII TAYSIDE PENSION FUND AUDIT SCOTLAND ANNUAL AUDIT PLAN 2023/24

There was submitted Report No 74-2024 by the Executive Director of Corporate Services providing a summary of the responsibilities and approach of Audit Scotland in respect of Tayside Pension Fund for 2023/24.

The Sub-Committee and Board:-

(i)                     noted the content of the report; and

(ii)                    agreed to provide Audit Scotland with confirmation of any instances of actual, suspected or alleged fraud, as a requirement of the revised International Standard on Accounting (ISA) 240.

 

There was submitted Report No 75-2024 by the Executive Director of Corporate Services setting out the risk assessment undertaken by PwC and detailing their internal audit plans for Tayside Pension Fund for 2024/25.

 

The Sub-Committee and Board:-

 

(i)                     agreed to review and approve the Internal Audit plan by PricewaterhouseCoopers (PwC) as detailed in appendix A of the report.

 

IX TAYSIDE PENSION FUND INTERNAL AUDIT REPORTS PENSIONS ADMINISTRATION &LIQUIDITY

There was submitted Report No 76-2024 by the Executive Director of Corporate Services submitting the Audit Reports prepared by the Funds Internal Auditor, PricewaterhouseCoopers (PwC).

The Sub-Committee and Board:-

(i)                     noted the content of the report on the audit exercises undertaken and approved the management response.

X TREASURY POLICY STATEMENT 2024/25

There was submitted Report No 77-2024 by the Executive Director of Corporate Services revising the Funds Treasury Policy Statement which was intended to govern all treasury activities carried out by Tayside Pension Fund.

The Sub-Committee and Board:-

(i)                     approved the policies and procedures laid out in the Treasury Policy Statement 2024/25, noting that the Treasury Policy Statement must be reviewed annually, and that there were no changes.

XI TREASURY MANAGEMENT STRATEGY 2024/2025

There was submitted Report No 78-2024 by the Executive Director of Corporate Services seeking agreement for reviewing the Treasury Management Strategy for Tayside Pension Fund.

The Sub-Committee and Board:-

(i)                     agreed to review the Treasury Management Strategy for Tayside Pension Fund.

XII PENSION ADMINISTRATION STRATEGY

There was submitted Report No 79-2024 by the Executive Director of Corporate Services setting out the Funds policy in respect of the standards required of both the Fund and the participating employers to ensure that statutory obligations were met and also to demonstrate effective and efficient service delivery. The strategy contained a variety of performance measures against which the Fund and participating employers were assessed, with performance reported to the Committee.

The Sub-Committee and Board:-

(i)                     agreed to approve the strategy contained within, noting that there were no changes.

XIII TAYSIDE PENSION FUND COMMUNICATION POLICY

There was submitted Report No 80-2024 by the Executive Director of Corporate Services presenting a communications policy as required by the Local Government Pension Scheme (Scotland) Regulations 2014.

The Sub-Committee and Board:-

(i)                     approved the revised Communications Policy which had been reviewed in conjunction with the Funds Administration Strategy, noting the increase of de minimis value of change of monthly pension benefit of over 10, where a pension member would be issued with an additional payslip. This change was in line with other Scottish LGPS Funds.

XIV ENVIRONMENTAL, SOCIAL & CORPORATE GOVERNANCE POLICY

There was submitted Report No 81-2024 by the Executive Director of Corporate Services reviewing Tayside Pension Funds Environmental, Social & Corporate Governance Policy.

The Sub-Committee and Board:-

(i)                     approved the policy and noted that there were no changes.

XV TAYSIDE PENSION FUND ACTUARIAL VALUATION

 

There was submitted Report No 82-2024 by the Executive Director of Corporate Services updating the Sub-Committee and Board on the Actuarial Valuation of Tayside Pension Fund at 31st March, 2023.

 

The Sub-Committee and Board:-

 

(i)                     noted the information contained within the report and approved the actuarial recommendations contained in Appendix A to the report.

 

XVI FUNDING STRATEGY STATEMENT 2024

There was submitted Report No 83-2024 by the Executive Director of Corporate Services reviewing the Funding Strategy Statements for the Tayside Pension Fund.

The Sub-Committee and Board:-

(i)                     noted that the Funding Strategy Statement was required to be reviewed annually, and approved the Statement, noting an amendment to the cessation approach following the strong rise in gilt yields since the end of 2022. The calculation method had been reviewed and adjustments had been made to the stochastic approach including a reduction of the probability limit of a deficit arising from 20% to 15%.

XVII STATEMENT OF INVESTMENT PRINCIPLES REVIEW

There was submitted Report No 84-2024 by the Executive Director of Corporate Services reviewing the Statement of Investment Principles for Tayside Pension Fund.

The Sub-Committee and Board:-

(i)                     noted the information within the report, noting the changes to benchmark in Appendix C effective from 1st April, 2024; and approved the Statements of Investment Principles contained in Appendix 1.

XVIII TAYSIDE PENSION FUND BUSINESS PLAN 2024/2025

There was submitted Report No 85-2024 by the Executive Director of Corporate Services introducing the annual business plan for the Tayside Pension Fund.

The Sub-Committee and Board:-

(i)                     noted the information within the report and approved the 2024/2025 Business Plan which applied to the administration and management of the Tayside Pension Fund.

The Sub-Committee and Board 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.

XIX TAYSIDE PENSION FUND

(a)                    TAYSIDE PENSION FUND PERFORMANCE SUMMARY

There was submitted Report No 86-2024 by the Executive Director of Corporate Services reviewing the investment performance of the Funds investment managers for the quarter to 31st December, 2023. The report compared investment performance of the Fund with the Funds specific benchmarks which consisted of various stock and security market indices.

The Sub-Committee and Board:-

(i)                     noted the information contained therein with regard to the performance of the Tayside Main Fund and their Fund Managers.

(b)                    SUMMARIES OF INVESTMENTS AND TRANSACTIONS 1ST OCTOBER TO 31ST DECEMBER, 2023

There was submitted Report No 69-2024 by the Executive Director of Corporate Services reviewing the investment activities of Tayside Pension Funds five Fund Managers for the quarter  1st October to 31st December, 2023 and summarising the transactions of each Fund Manager and showing the market values of the Pension Fund.

The Sub-Committee and Board:-

(i)                     noted the information contained therein with regard to the performance of the Tayside Main Fund and their Fund Managers.

(c)                    SECURITIES LENDING 6 MONTH ACTIVITY TO 31ST DECEMBER, 2023

There was submitted Report No 87-2024 by the Executive Director of Corporate Services presenting an update on Securities Lending activity for the period ended 31st December, 2023.

The Sub-Committee and Board:-

(i)                     agreed to note the content of the report.

 

A verbal update was given by the Service Manager, Financial Services on the Alternative Investment Mandate Procurement Exercise.

 

The Sub-Committee and Board:-

 

(i)                     noted the position.

 

XXI ANNUAL PERFORMANCE REVIEW TO 31ST DECEMBER, 2023

 

There was submitted Report No 88-2024 by the Executive Director of Corporate Services considering the Isio report Annual Review of Investment Performance 2023 completed in February 2024.

 

The Sub-Committee and Board:-

 

(i)                     noted the content of the Isio report in Appendix A to the report.

 

XXII PRESENTATION

 

Sarah Cockburn Olivia Docker and Lucie Liss from Schroders gave a short presentation to the Sub‑Committee and Board.

 

After Ms Cockburn, Ms Docker and Ms Liss had given their presentation and answered questions from members, the Chair thanked the presenters on behalf of members of the Sub-Committee and Board.

 

 

 

 

Steven ROME, Chair.