Agenda item

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 Abbott introduced the item; 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. The risk assessment presented at this meeting focused primarily on the investment-related risks.

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

• Cllr Hymas sought clarification regarding the Fund’s Environmental, Social and Governance (ESG) policy. Tim Mpofu explained that the Fund’s ESG policy would be further discussed as part of the Investment Strategy Statement (ISS) agenda item which had been included as part of the exempt portion of the meeting’s agenda. The ISS sets out what investments the Fund can and cannot invest in. Through engagement with members, it had been determined that more time should be taken to consider the Fund’s approach to responsible investment. The development of such a policy may require the use of external specialists to advise the Committee and Board. It was further noted that Funds were required to outline their approach to managing ESG risks in their ISS, however a responsible investment policy would be supplementary to the ISS.
• Cllr White explained that he thought more emphasis was needed on other parts of the ESG, such as the social and other ethical sides of investments. He suggested it would be good to have a deeper conversation about this and updating the investment strategy upon reflection.
• Following a query regarding the outstanding audits, it was confirmed that officers had investigated whether separate auditors could be appointed, and this was deemed not possible under the current regulations. There was an ongoing conversation between the Haringey finance team and the external auditors to try and address the external audits backlog. It was confirmed that this issue had been raised at previous meetings as a concern hence why this had been included as part of the risk register. It was further noted that the Government had sent out a letter in the autumn of 2023 where they had set out how they were planning on tackling public sector audit backlog; 40% of audits were still outstanding across the country in the public sector. The Scheme Advisory Board was working closely with the Government to explore whether pension fund audits could be separated from the audit of the Council’s statement of accounts. It was confirmed that a new audit firm would be undertaking the audit of the current financial year ending 31 March 2024 and the team had already started to engage with on the planning work. The finance team had discussed the issues relating to the outstanding audits with them. The team were trying to progress this but unfortunately the way in which the rules were set up meant there was not much more that could be done to progress the issue.
• It was further noted that there was no provision in the Council’s constitution that would enable the combined Pensions Committee and Board to appoint an external auditor. External auditor appointments for local government bodies were made by the Public Sector Audit Appointments Limited (PSAA).

RESOLVED

To note and provide any comments on the Fund’s risk register. The area of focus for review at this meeting was Investment-related risks.