Agenda and draft minutes

Pensions Committee and Board
Thursday, 21st January, 2021 7.00 pm

Venue: Remote Meeting - MS Teams

Contact: Fiona Rae, Principal Committee Co-ordinator  3541 Email: fiona.rae@haringey.gov.uk

Note: This meeting will be webcast - use the link on the agenda frontsheet or copy and paste the following link into your internet browser: https://teams.microsoft.com/l/meetup-join/19%3ameeting_YjJmODk4OTctZGI2Yy00MGQwLWFkZDMtMzFlOTY0MjA5YWRm%40thread.v2/0?context=%7b%22Tid%22%3a%226ddfa760-8cd5-44a8-8e48-d8ca487731c3%22%2c%22Oid%22%3a%22515ca3a4-dc98-4c16-9d83-85d643583e43%22%2c%22IsBroadcastMeeting%22%3atrue%7d 

Items
No. Item

1.

FILMING AT MEETINGS

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.

Minutes:

The Chair referred to the notice of filming at meetings and this information was noted.

2.

APOLOGIES FOR ABSENCE

To receive any apologies for absence.

Minutes:

There were no apologies for absence.

3.

URGENT BUSINESS

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 16 below).

Minutes:

There were no items of urgent business.

4.

DECLARATIONS OF INTEREST

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.

Minutes:

There were no declarations of interest.

5.

DEPUTATIONS / PETITIONS / PRESENTATIONS / QUESTIONS

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

Minutes:

There were no deputations, petitions, presentations, or questions.

6.

RECORD OF TRAINING UNDERTAKEN SINCE LAST MEETING

Note from the Assistant Director of Corporate Governance and 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.

Minutes:

It was noted that Councillor John Bevan (Chair), Councillor Julie Davies (Vice-Chair), Councillor James Chiriyankandath, Councillor Paul Dennison, Councillor Viv Ross, Ishmael Owarish, Keith Brown, and Randy Plowright had attended a training session on 21 January 2021 entitled: Governance and Sustainable Investments.

 

It was also noted that the Chair had undertaken the following training: London CIV Low carbon equity briefing (November 2020); LGPS Live: Pension Issues briefing, North London Pension Funds Chairs’ Forum, London CIV Pension Chairs’ briefing, London CIV Low Carbon Equity Investing (December 2020); Pensioners Trustees Circle virtual forum seminar, and London CIV business update (January 2021). Cllr Ross confirmed that he had attended Pension Investment Academy training on Environment, Social, and Governance – Regulation Developments, Practical Implications and Trustee Issues (January 2021).

7.

MEMBERSHIP

To confirm one employer member, as appointed by employers, and one employee member, as appointed by trade unions, for a four year term of office.

Minutes:

It was explained that the term of office for one employee member, as appointed by trade unions, had expired and the term of office for one employer member was about to expire.

 

Following consultation with trade unions, it was noted that Randy Plowright had been nominated as an employee member, as appointed by trade unions. Following consultation with employers, it was noted that Keith Brown had been nominated as an employer member. It was explained that the Pensions Committee and Board was asked to confirm these appointments for a four year term of office.

 

RESOLVED

 

To confirm Keith Brown as an employer member and Randy Plowright as an employee member, as appointed by trade unions, on the Pensions Committee and Board for a four year term of office.

8.

MINUTES pdf icon PDF 406 KB

To confirm and sign the minutes of the Pensions Committee and Board meeting held on 23 November 2020 as a correct record.

Minutes:

Cllr Ross noted that members of the Pensions Committee and Board were due to observe the investment management consultancy services interview process in early January 2021. The Chair explained that the interviews had not taken place yet as the procurement exercise had to be re-run; when a new date for interviews was set, members would be invited.

 

RESOLVED

 

That the minutes of the Pensions Committee and Board meeting held on 23 November 2020 be confirmed and signed as a correct record.

9.

PENSION ADMINISTRATION REPORT pdf icon PDF 429 KB

This report provides updates regarding:

 

·         The amount of visits made to the Haringey pension fund website;

·         An update in light of the current Coronavirus pandemic; and

·         Details of an employer joining the pension fund.

Minutes:

The Pensions Manager introduced the report which provided an update on the amount of visits to the Haringey Pension Fund website, an update in light of the Covid-19 pandemic, and details of an employer joining the fund. It was noted that the number of website visits in November 2020 was slightly higher than the previous year and the number of deaths in November 2020 was lower than the 2015-2019 average. The Pensions Committee and Board were also asked to note and approve the admission of Little Engineers Nursery, which was part of the London Diocesan Board for Schools (LDBS) Academies Trust to the pension fund. It was confirmed that there were 10 members of staff currently employed by Holy Trinity School, which was part of the Local Government Pension Scheme, who would be transferring to the nursery, which was entering the Local Government Pension Scheme as a new employer.

 

RESOLVED

 

1.    To note the report which gave a breakdown of the amount of visits made to the Haringey Pension Fund website and an update regarding pension administration matters.

 

2.    To note and approve the admission of Little Engineers Nursery, an Academy which was part of the London Diocesan Board for Schools (LDBS) Academies Trust, as a new scheduled employer in the pension fund.

10.

PENSION FUND QUARTERLY UPDATE AND INVESTMENTS UPDATE pdf icon PDF 359 KB

This report provides updates on the following matters in respect of the three months to 30 September 2020:

 

·         Investment asset allocation;

·         Independent Advisor’s Market Commentary;

·         Update on the Fund’s accounts and annual report;

·         Funding position update;

·         Investment Performance;

·         London Collective Investment Vehicle (LCIV) Update; and

·         Stewardship Update.

Additional documents:

Minutes:

The Head of Pensions and Treasury introduced the report which provided an update on the Pension Fund and investments. It was noted that the annual accounts were due to be signed off on 30 November 2020 but that the National Audit Office had directed that both the audit opinion for the Council and Pension Fund accounts should be issued together. As the audit of the Council’s accounts was due to be completed in January 2021, it was anticipated that the audit opinion for the Pension Fund would be issued in January 2021.

 

In relation to the portfolio allocation, it was reported that there were a few asset classes which were slightly different to the benchmark. It was noted that renewable energy was slightly under the allocation but that this would be rectified once the recently approved investments were made with the new London CIV renewable energy strategy. It was stated that pension fund’s investment performance was 2.24% which was slightly under the benchmark of 2.34%. It was added that the fund compared well in relation to the year to date and in the long term.

 

It was reported that the London Collective Investment Vehicle (CIV) had made some key appointments, including the Head of Private Markets, who would be leading on the London Fund and private equity, and a Responsible Investment Manager. It was noted that a report on the London Fund, which had recently launched, was due to be presented to the Pensions Committee and Board in March. The Head of Pensions and Treasury reported that three London CIV sub fund managers remained under enhanced monitoring, one of which was CQS which had been in this position for over 10 months. The London CIV still planned to appoint a second multi asset credit (MAC) manager to complement CQS but had confirmed that the Haringey Pension Fund would not be required to divide its investments equally between the two MAC managers unless it wished to do so, as a separate sub-fund would retain 100% in CQS. It was confirmed that, once the London CIV proposals were finalised, due diligence work would be undertaken and a decision would be made about whether to remain invested in CQS or to accept the proposed additional manager.

 

The Head of Pensions and Treasury noted that the Pensions Committee and Board had raised concerns that one of the fund’s investment managers had not signed up to the United Nations Principles of Responsible Investment (UNPRI). It was explained that this manager had now signed up and this would be effective from February 2021. It was enquired whether the investment manager, being a smaller manager, was able to secure smaller fees in signing up to the UNPRI; the Head of Pensions and Treasury agreed to confirm.

 

An update was provided in relation to companies that were operating in Occupied Palestinian Territories/ Israeli Settlements. It was noted that the Pensions Committee and Board had agreed that the Local Authority Pension Fund Forum (LAPFF), as Environmental, Social, and Governance  ...  view the full minutes text for item 10.

11.

REVIEW OF CONFLICTS OF INTEREST POLICY pdf icon PDF 222 KB

This report introduces the proposed Conflicts of Interest Policy.

Additional documents:

Minutes:

The Chair noted that, under the Conflicts of Interest Policy, the latest version of the register of interest would be made available to the Chair prior to each Pensions Committee and Board meeting. He noted that he did not believe that this was currently done and he did not recall submitting a declaration form. The Principal Committee Co-ordinator explained that councillors who were members of the Pensions Committee and Board were required to declare all of their interests as part of their ordinary councillor role and these interests were published online. In relation to co-opted members, it was explained that a declaration of interest form was circulated and submitted by co-opted members annually. The Head of Pensions and Treasury added that any relevant interests were declared at each meeting and it could be checked whether the register needed to be shared with the Chair in advance of each meeting. The Chair stated that this was an administrative matter and the details could be decided outside of the meeting.

 

RESOLVED

 

To approve and adopt the Conflicts of Interest Policy as set out in Appendix 1 to the report.

12.

PROPOSED AMENDMENT TO THE CONSTITUTION - MEMBERSHIP OF THE PENSIONS COMMITTEE AND BOARD pdf icon PDF 191 KB

This report proposes to amend the wording of the constitution in relation to employer representatives of the Pensions Committee and Board to bring it in line with Pensions Regulations.

Minutes:

The Principal Committee Co-ordinator introduced the report which sought to amend the wording of the Pensions Committee and Board terms of reference in relation to employer representatives to bring it in line with the Local Government Pension Scheme (Amendment) (Governance) Regulations 2015 (the Pensions Regulations). It was noted that any comments from the Pensions Committee and Board would be passed on to the Standards Committee who would be considering the proposal at a meeting on 25 January 2021.

 

It was explained that the existing wording in relation to employer members of the Pensions Committee and Board in the Haringey Council constitution was narrower than the statutory wording in the Pensions Regulations. The proposed amendment would bring the wording in line with the Pensions Regulations and would mean that employer members would not need to be from scheduled and admitted employers but would need to have the capacity to represent scheduled and admitted employers. It was added that one employer member position had been vacant for several years and it was hoped that this wider definition would assist in filling the vacancy.

 

The Assistant Director of Finance confirmed that there had been numerous efforts to recruit an employer member to fill the vacant position; this had included writing to employers approximately four times in the last few years, communicating with senior management within the employers, and contacting individual academies. It was suggested that the vacancy could be advertised in a relevant journal or brought to the attention academy governors.

 

RESOLVED

 

1.    To note the proposed amendment of the wording in relation to employer representatives of the Pensions Committee and Board to bring it in line with Pensions Regulations.

 

2.    To provide the following comments to the Standards Committee for its consideration: That the Pensions Committee and Board noted the proposed amendment and hoped that the amended wording, which would provide a wider pool of potential employer representatives, would assist in filling the employer representative vacancy which had existed for several years.

13.

LOCAL AUTHORITY PENSION FUND FORUM (LAPFF) VOTING UPDATE pdf icon PDF 528 KB

The Fund is a member of the Local Authority Pension Fund Forum (LAPFF) and the Committee and Board has previously agreed that the Fund should cast its votes at investor meetings in line with LAPFF voting recommendations. This report provides an update on voting activities on behalf of the Fund.

Minutes:

The Head of Pensions and Treasury introduced the report which provided an update on voting activities on behalf of the Fund. It was explained that, in this quarter, there had been four voting recommendations from the Local Authority Pension Fund Forum (LAPFF). The Pension Fund’s equity manager, Legal and General Investment Management (LGIM), had voted in line with three of the four recommendations and the fourth had been withdrawn. Notably, it was reported that Procter & Gamble had been defeated on the vote on efforts to eliminate deforestation at the Procter & Gamble AGM. In the other cases, the results of the votes had been contrary to the LAPFF recommendations.

 

RESOLVED

 

To note the report.

14.

RISK REGISTER pdf icon PDF 196 KB

This paper provides an update on the Fund’s risk register and an opportunity for the Pensions Committee and Board to further review the risk score allocation.

Additional documents:

Minutes:

The Chair noted that the risk register contained two sections; the first section had a summary of all risks and the second section presented two or three risk areas per meeting for more detailed consideration by the Pensions Committee and Board.

 

Keith Brown noted concerns in relation to risk 58 (London CIV investment strategy) which stated that, if the London CIV did not adopt the right strategy, this would be a risk to the Haringey Pension Fund. He commented that, if this was the case, the Pension Fund could decline to use the London CIV or, if the Pension Fund had to use the CIV, this amounted to a conflict of interest under the new governance rules. The Head of Pensions and Treasury noted that, before investing, the Pension Fund would need to make sure that the manager and mandate met the criteria for investment. It was explained that the Pension Fund could decide whether or not to invest but the risk was that, once the Pension Fund had invested, there would be less direct control and things could change. Keith Brown noted that this applied to any manager and that there would still be an option to withdraw.

 

Cllr Dennison noted that the Pensions Committee and Board considered two areas of risk in more detail at every meeting but that this could lead to some risks not being considered in detail for some time; he provided the example of risk 59 (impact of Coronavirus). The Head of Pensions and Treasury explained that all risks were provided with brief details at every meeting and that, if the Pensions Committee and Board had any concerns, a risk level could be increased to very high (red) as red rated risks were reported in detail to each meeting. It was confirmed that risk 59 (impact of Coronavirus) was already rated very high (red) and was currently presented to each Pensions Committee and Board meeting.

 

RESOLVED

 

1.    To note the risk register.

 

2.    To note that the area of focus for review at the meeting was Administration and Communication.

15.

FORWARD PLAN pdf icon PDF 196 KB

The purpose of the paper is to identify topics that will come to the attention of the Committee and Board in the next twelve months and to seek members’ input into future agendas. Suggestions for future training are also requested.

Additional documents:

Minutes:

The Head of Pensions and Treasury introduced the item and highlighted that it had been necessary to extend the tender period for the item on investment management consultancy services, which was due to be presented to this meeting; the item was now projected to be presented to the Pensions Committee and Board in March 2021.

 

It was highlighted that there were training opportunities for members, including a Local Government Association update on the Local Government Pension Scheme (LGPS) Governance and Investment on 26 January 2021 and a LGPS Local Pension Board spring seminar on 19 February 2021. If any members wanted to attend these sessions, they were asked to inform the Head of Pensions and Treasury. It was added that the Public Sector Tool Kit was a good source of training.

 

The Chair noted that the London CIV had regular meetings which he attended and he had asked for any major issues, in particular issues going to the Annual General Meeting (AGM), to be presented to the Pensions Committee and Board. It was confirmed that the next London CIV meeting was not due to consider any material items but that the London CIV AGM would be included as an item on future forward plans.

 

Cllr Dennison noted that it was suggested at the training session for the Pensions Committee and Board on 21 January 2021 that it would be useful to conduct some gap analysis in relation to the Ministry of Communities, Housing, and Local Government proposals for pensions; it was also enquired whether it would be possible to benchmark potential costs compared with other pension funds. It was also asked when and how the Pensions Committee and Board would consider the pension fund allocation to the London CIV, namely whether this would be a 50% or 100% allocation. The Head of Pensions and Treasury noted that a gap analysis and some cost benchmarking would be included on the forward plan. In relation to the London CIV, it was explained that the options would be presented after some initial due diligence work had been undertaken.

 

RESOLVED

 

1.    To note the work plan, the training programme, and the update on member training, attached as Appendices 1-3 of the report.

 

2.    To complete The Pension Regulator’s public sector toolkit and training needs analysis.

16.

NEW ITEMS OF URGENT BUSINESS

Minutes:

There were no items of urgent business.

17.

DATES OF FUTURE MEETINGS

To note the dates of future meetings:

 

4 March 2021

Minutes:

It was noted that the next Pensions Committee meeting was scheduled for 4 March 2021.

18.

EXCLUSION OF THE PRESS AND PUBLIC

Items 19-21 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).

Minutes:

RESOLVED

 

That the press and public be excluded from the meeting for consideration of items 19-22 as they contained 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).

19.

NEW ITEMS OF EXEMPT URGENT BUSINESS

Minutes:

There were no items of exempt urgent business.

20.

PENSION FUND QUARTERLY UPDATE AND INVESTMENTS UPDATE

As per item 10.

Minutes:

The Pensions Committee and Board considered the exempt information.

21.

EXEMPT MINUTES

To confirm and sign the exempt minutes of the Pensions Committee and Board meeting held on 23 November 2020 as a correct record.

Minutes:

RESOLVED

 

That the exempt minutes of the Pensions Committee and Board meeting held on 23 November 2020 be confirmed and signed as a correct record.