Agenda and draft minutes

Please note this meeting may be filmed or recorded by the Council for live or subsequent broadcast via the Council’s internet site or by anyone attending the meeting using any communication method.  Members of the public participating in the meeting (e.g. making deputations, asking questions, making oral protests) should be aware that they are likely to be filmed, recorded or reported on.  By entering the ‘meeting room’, you are consenting to being filmed and to the possible use of those images and sound recordings.

The Chair of the meeting has the discretion to terminate or suspend filming or recording, if in his or her opinion continuation of the filming, recording or reporting would disrupt or prejudice the proceedings, infringe the rights of any individual, or may lead to the breach of a legal obligation by the Council.

The Chair referred Members present to agenda Item 1 as shown on the agenda in respect of filming at this meeting, and Members noted the information contained therein.

To receive any apologies for absence.

Apologies for absence received from Randy Plowright.

The Chair will consider the admission of any late items of Urgent Business.  (Late items of Urgent Business will be considered under the agenda item where they appear. New items of Urgent Business will be dealt with under item 13 below).

There were no items of urgent business.

A member with a disclosable pecuniary interest or a prejudicial interest in a matter who attends a meeting of the authority at which the matter is considered:

(i) must disclose the interest at the start of the meeting or when the interest becomes apparent, and

(ii) may not participate in any discussion or vote on the matter and must withdraw from the meeting room.

A member who discloses at a meeting a disclosable pecuniary interest which is not registered in the Register of Members’ Interests or the subject of a pending notification must notify the Monitoring Officer of the interest within 28 days of the disclosure.

Disclosable pecuniary interests, personal interests and prejudicial interests are defined at Paragraphs 5-7 and Appendix A of the Members’ Code of Conduct

The Public Service Pensions Act 2013 defines a conflict of interest as a financial or other interest which is likely to prejudice a person’s exercise of functions. Therefore, a conflict of interest may arise when an individual:

i)             Has a responsibility or duty in relation to the management of, or provision of advice to, the LBHPF, and

ii)            At the same time, has:

-       a separate personal interest (financial or otherwise) or

-       another responsibility in relation to that matter,

giving rise to a possible conflict with their first responsibility. An interest could also arise due to a family member or close colleague having a specific responsibility or interest in a matter.

At the commencement of the meeting, the Chair will ask all Members of the Committee and Board to declare any new potential conflicts and these will be recorded in the minutes of the meeting and the Fund’s Register of Conflicts of Interest. Any individual who considers that they or another individual has a potential or actual conflict of interest which relates to an item of business at a meeting must advise the Chair prior to the meeting, where possible, or state this clearly at the meeting at the earliest possible opportunity.

There were no declarations of interest.

To consider any requests received in accordance with Part 4, Section B, paragraph 29 of the Council’s constitution.

There were none received.

Note from the Head of Legal and Governance (Monitoring Officer)

When considering the items below, the Committee will be operating in its capacity as ‘Administering Authority’. When the Committee is operating in its capacity as an Administering Authority, Members must have due regard to their duty as quasi-trustees to act in the best interest of the Pension Fund above all other considerations.

On 3 September 2024, all members attended a training session entitled “An Introduction to ESG” as part of the Responsible Investment Policy development work. The training was delivered by bfinance.

To confirm and sign the minutes of the Pensions Committee and Board meeting held on 25 07 2024 as a correct record.

RESOLVED:

That the minutes of the meeting held on 25th July 2024 be confirmed and signed as a correct record.

This report provides the Pensions Committee and Board (PCB) with an update on several important issues related to the Local Government Pension Scheme (LGPS) at a national level. The issues covered in this paper are:

a.       Update on the Consultation outcome of November 2023

b.       The Ministerial Letter of 15 May 2024

c.       New Government Ministers

d.       The new Government and the LGPS

e.       Annual Pension Fund Report

f.         LGPS Accounts and Audit

Review of 2022 Actuarial Valuations by the Government Actuary

Tim Mpofu, Head of Pensions and Treasury introduced this report. This report provided the Pensions Committee and Board (PCB) with an update on several important issues related to the Local Government Pension Scheme (LGPS) at a national level. The Pension Fund’s Independent Advisor, John Raisin summarised his paper which was included as Appendix 1 to this report.

The following was noted in response to questions from the committee:

• John Raisin noted that some councils chose their actuaries, thus used different assessments of lifespan; the government were seeking a common standard. He also noted that actuaries were acting within guidance and not acting improperly. The council may use different assumptions, but these were all within the guidelines.
• Cllr White raised concerns around the prospect that the LGPS would be used as a sovereign wealth fund to get growth in the economy. The LGPS was well funded, with the average fund being at 107%. The real concern would be anything that diverted LGPS funds. It was important to think about how to minimise and mitigate the pressures that were on employers.
• Cllr Dunstall queried ESG activities and what this would look like. John Raisin explained this would not be particularly burdensome. He noted that the Government might be surprised at how much UK investment there was by the LGPS.

RESOLVED

This report was noted.

This report presents the Haringey Pension Fund Annual Report and unaudited accounts for 2023/24 to the Pensions Committee and Board for approval, subject to the successful completion of the external audit exercise.

Taryn Eves introduced this report. This report presented the Haringey Pension Fund Annual Report and unaudited accounts for 2023/24 to the Pensions Committee and Board for approval.

The following was noted in response to questions from the committee:

• Cllr Bevan noted that this was a comprehensive report, he requested that the investors and staff admin fees be reported collectively as a percentage figure of the overall fund. Taryn Eves explained that the team would look at how best to provide this figure to the committee and would look to share this at a future meeting. Cllr Bevan noted that members had been previously informed that the investment fees disclosed in the annual report contained some hidden fees. He queried whether this issue had been resolved. Tim Mpofu explained that the Scheme Advisory Board had successfully launched the Cost Transparency Initiative and all the Fund’s appointed investment managers had completed the templates detailing these fees. It was further noted that the statutory guidance that the Scheme Advisory Board had issued, was expected to specify how those fees should be accounted for in the Pension Fund accounts.

• Cllr Hymas queried whether the pension fund drew down on the general council fund. Taryn Eves explained that these were two separate accounts and separate funds. There were two essential areas, one of these being the cost of the team, this would be fully funded by the pension fund. The second area was the employer contribution rates, which were reviewed at each triennial revaluation, the last one being carried out in 2022. When those contribution rates were being set, the fund actuary would look at the funding level of each employer; there were a number of employers with different funding levels within the scheme, this would all be taken into context when setting these rates.
• Taryn Eves noted that for the iteration of this report did not have any big changes. Officers had made changes that were the easiest to implement given the time when the Statutory Guidance was issued which came into effect from 1 April 2024. It was further noted that most of the required changes included in the Statutory Guidance had already been incorporated in the Fund’s Annual Report. In addition to this, it was noted that the Scheme Advisory Board was aiming for more consistency and one of the key elements of the guidance was to allow funds to publish the Annual Report without it to include an audited Statement of Accounts.
• Cllr Iyngkaran requested from officers the benchmark of administrative costs compared to other schemes. Tim Mpofu explained that this could be prepared for members. Normally, schemes used the SF3 report for benchmarking marking purposes, which included information that was slightly different to the disclosures included in the Annual Report. However, all local government pensions were required to complete the government return. The deadline for completion of the SF3 report this was the middle of September and officers expected the final report to be issued before the end of the  ...  view the full minutes text for item 9.

This report provides the Pensions Committee and Board (PCB) with the following updates regarding Pension Fund’s administration activities:

a.       Pension Fund membership update

b.       Online Member Self Service portal update

c.       Update on Service Level Agreement (SLA) statistics

d.       Update on Annual Benefit Statement exercise

e.       Update on Scheme Member engagement

Jamie Abbott introduced the item. This report provided the Pensions Committee and Board (PCB) with updates regarding Pension Fund’s administration activities.

The following was noted in response to questions from the committee:

• Cllr Bevan queried the team in regard to staffing. Jamie Abbott explained that there were 2 apprentices within the team. They were receiving both in-house and external training on the LGPS and pensions administration function.
• Cllr Hymas noted for the record her congratulations to the team on being nominated for 2024 LAPF Investments Awards, Pension Administration Award.

RESOLVED

This report was noted.

This report updates the Pensions Committee and Board on the Fund's ongoing Responsible Investment development and implementation work. It also provides an update on the Local Authority Pension Fund Forum's (LAPFF) engagement and voting activities conducted on behalf of the Fund.

Tim Mpofu introduced this report. This report updated the Pensions Committee and Board on the Fund's ongoing Responsible Investment development and implementation work. It also provided an update on the Local Authority Pension Fund Forum's (LAPFF) engagement and voting activities conducted on behalf of the Fund.

Members had no queries on this item.

RESOLVED

This report was noted.

This paper has been prepared to update the Pensions Committee and Board on the Pension Fund’s risk register and provide an opportunity for the Pensions Committee and Board to further review the risk score allocation.

Jamie Abbot introduced this report.This paper had been prepared to update the Pensions Committee and Board on the Pension Fund’s risk register and provide an opportunity for the Pensions Committee and Board to further review the risk score allocation. This focus area for this meeting was Accounting related risks.

The following was noted in response to questions from members:

• It was suggested by members that the inclusion of indicators to show the change in risk rating was helpful.
• Tim Mpofu suggested whether it would be helpful for PCB members to have direct access to the risk register. Officers would continue to support by evaluating the scoring, and members would provide challenge where necessary.
• Cllr Iyngkaran queried how often the risks were reviewed. Tim Mpofu explained that officers were consistently reviewing risks, the register presented at these meetings was primarily for the purposes of assisting the Committee and Board in the evaluation and monitoring of the Fund’s risk. The date included on the report was the most recent review prior to the publishing of Committee papers. It was further noted that this risk register included several tabs where iterations were made and could be easily shared with Committee and Board members. The assessment of all risks was based on the Pension Fund, so it was the Fund’s risk, not necessarily the councils.
• Cllr White noted that perhaps text could be expanded so that members were not seen to be treating their own individual reputations as members of this committee, as on par with fiduciary duties.
• Cllr Dunstall noted that the risk register was clear but suggested it might be useful to distinguish key risks on the register.
• Cllr Hymas sought clarity on the methodology on how officers calculated the individual risk scores for each category. Tim Mpofu explained how the risk assessment was done. Officers would also gauge risks based on their professional knowledge and experience, and from time to time by comparing the risks and scores of  similar LGPS Funds. It was noted that it would be useful for members to further understand likelihood and impact. The committee welcomed the idea of a deep dive on risks.

RESOLVED

This report was noted.

This paper has been prepared to identify and agree upon the key priorities for the Pensions Committee and Board (PCB) over the upcoming months, as well as seek the PCB’s input into future agendas.

Tim Mpofu introduced the report for this item. This paper had been prepared to identify and agree upon the key priorities for the Pensions Committee and Board (PCB) over the upcoming months, as well as seek the PCB’s input into future agendas.

The following was noted in response to questions from the committee:

• Cllr Bevan and Cllr White both noted to members the importance of attending conferences hosted by the Local Authorities Pension Fund Forum (LAPFF). Members would look at their availability and confirm attendance with the Head of Pensions.

RESOLVED

This report was noted.

• There was an action for Jamie Abbott to set up a session for members on LOLA training platform.

This report provides the Pensions Committee and Board (PCB) with the following updates on the Pension Fund’s performance for the quarter ended 30 June 2024:

a.       Overview of fund performance including funding position update

b.       Independent advisor’s market commentary

c.       Investment manager performance

d.       Asset allocation

Tim Mpofu introduced the report for this item. This report provided the Pensions Committee and Board (PCB) with updates on the Pension Fund’s investment performance for the quarter ended 30 June 2024.

The following was noted in response to questions from the Committee and Board:

• Cllr Bevan queried Mercer’s position on the 9 separate investment managers and 9 separate categories of investment. Steve Turner, explained that Haringey had a well-diversified portfolio and was in a good position for returns. The 9 separate investment managers and categories for investment could appear a lot to monitor, but the governance of the Committee and Board and officers meant the team were well capable to monitor assets effectively. Tim Mpofu elaborated that there were several appointment investment managers, but in terms of the actual asset allocation, the Fund was appropriately diversified. It was further noted that the team was exploring how to expand performance reporting to include specific composites based on asset class and investment objective in future reports. For example, the Fund’s listed equities allocation, included the MSCI World Low Carbon Tracker Fund, the RAFI Multi-Factor Climate Transition Fund and a bespoke passive Emerging Markets Fund. All these Funds would be included in the Listed Equities Composite for future performance review.
• Steve Turner explained that there was scope to increase the allocation to protective assets. The key reason for this was because of the strong funding level and the surplus that had been reported. That would give a number of options to consider, one might be to make changes to the allocation which provided greater stability in the funding level. The main reason why the funding level was so strong was because the value of the liabilities had come down. The more exposure invested in asset classes group bond yields, there would be some risk reduction. He strongly encouraged members to consider doing some de-risking.
• Steve Turner explained that the fund were overweight equities by 6%. Equities were the riskiest asset held from a long-term perspective, but this was liquid. There was a strong case to doing some rebalancing, that would mean reducing the overweight allocation to equities and there were opportunities to reallocate those assets. The fund was underweight multi asset credit and slightly underweight with index and gilts. There were some interesting opportunities in property and with reducing interest rates, the outlook for property was probably better than it had been.With what advisors thought the government was intending to do, there was scope to invest more in areas such as affordable housing; this was an asset class that had been discussed before with the committee that would also be well aligned with investing in a more impactful asset.
• Steve Turner noted that there was a lot of concern in the sector about the extent to which government guidance on investing has had an impact on fiduciary duty. With members fiduciary duty, they needed to make decisions which generated the required investment return. The sector was looking for the government to  ...  view the full minutes text for item 14.

There are no new items of urgent business.

To note the dates of future meetings:

2^ND DECEMBER 2024

20^TH MARCH 2025

2^ND DECEMBER 2024

20^TH MARCH 2025

Items 18-20 are likely to be subject to a motion to exclude the press and public from the meeting as they contain exempt information as defined in Section 100a of the Local Government Act 1972 (as amended by Section 12A of the Local Government Act 1985); para 3 – namely information relating to the financial or business affairs of any particular person (including the authority holding that information) and para 5 – information in respect of which a claim to legal professional privilege could be maintained in legal proceedings.

The following items were likely to be subject to a motion to exclude the press and public from the meeting as they contain exempt information as defined in Section 100a of the Local Government Act 1972 (as amended by Section 12A of the Local Government Act 1985); ara 3 – namely information relating to the financial or business affairs of any particular person (including the authority holding that information) and para 5 – information in respect of which a claim to legal professional privilege could be maintained in legal proceedings.

As per item 9.

To confirm and sign the exempt minutes of the Pensions Committee and Board meeting on 25 07 24 as a correct record.