Councillors and committees

Agenda and minutes

You can view the individual reports for this meeting by selecting the headings from the numbered list of items at the bottom of this page. Alternatively you can view the entire agenda by selecting 'Agenda Reports Pack' below.

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Venue: Guildhall, Kingston upon Thames KT1 1EU

Contact: Kevin Jones 0208 547 2266  Email: ann.sweeney@kingston.gov.uk

Items
No. Item

1.

Apologies for Absence

Minutes:

Apologies were received from Majid Mafi for whom Mark Cooper attended as substitute.

2.

Minutes

To confirm the minutes of the meeting held on 13 June 2019

 

Minutes:

Resolved that the minutes of the meeting held on 13 June 2019 are confirmed as a correct record.

3.

Declarations of Interest

Minutes:

There were no Declarations of Interest

4.

Training Item - Preparing the Investment Strategy

Minutes:

A training presentation by Daniel Carpenter and Mark Searle of Aon Hewitt was received by the Panel. It was noted that the current allocation of the portfolio was 85% growth focused (60% equities, 20% diversified growth and 5% property) and 15% in lower risk bonds. The trade-off was between risk and return with the objective being to set the right strategy to meet expected returns so that the long term strategy was the highest return for the lowest risk.

                                                                                                        

There was some discussion of the presentation specifically relating to communicating with members if policies changed, making sure the fund remained liquid in the long term, the revaluation of the fund which would happen during the latter half of 2019, investments in infrastructure and locally specific projects.

The Chair thanked the Aon Hewitt representatives.

 

 

5.

Pension Fund Valuation and Performance at 30 June 2019 pdf icon PDF 412 KB

Additional documents:

Minutes:

A report by Head of Investments, Risk & Commercial Finance – Resources was presented by Anthony Hugget.  The report considered the investment performance of the Fund and each manager for the quarter to end June 2019, performance in the last 12 months and annualised rolling three year performance against the benchmark. It was noted that the fund stood at £921 million which is 5.5%% up on the value at the end of March 2019.  There were concerns about the current US-China dispute, Federal Reserve interest cuts and global economic growth, all of which were characterised by global volatility. It was further noted that the equities were doing very well and that whilst the fund assets had increased the liabilities had reduced.

 

Resolved that the Panel notes the performance of the total Fund investments and individual fund managers.

 

6.

Pensions Administration Update pdf icon PDF 117 KB

Additional documents:

Minutes:

An Update on Pension Service Administration was presented by David Kellond, Pensions and Administration Manager, Shared Pensions Administration Service for Sutton and Kingston. The report provided an update on the main work streams impacting pension’s administration for the period to July 2019. It was noted that there had been problems with appointing suitable senior team members (item 4.2), but hopefully that would be resolved in the short term. Noted the words “Accounting Valuation Reports” between items 4.4 and 4.5 should be deleted and changed to “Pensions Saving Statements”. Key Performance Statistics (4.7) were noted. Further noted that they were trying to get members to use the members online self service portal ‘Pensions Online’ (4.15)  Members noted that the benefits structure may be changed in the next one or two years and this would affect the actuarial calculations (this would be considered as part of the Accounts next year); Members requested that MacLeod’s be asked to provide a progress update on this.

 

The Report was considered and noted.

 

7.

Exclusion of the Press and Public

The following resolution is included as a standard item which will only be relevant if any exempt matter is to be considered at the meeting for which the Committee wish to resolve to exclude the press and public:

 

To exclude the public from the meeting under Section 100(A)(4) of the Local Government Act 1972 on the grounds that it is likely that exempt information, as defined in paragraph x of Part I of Schedule 12A to the Act, would be disclosed and the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

 

Minutes:

Resolved that the public are excluded from the meeting for the following items under Section 100(A)(4) of the Local Government Act 1972 on the grounds that it is likely that Exempt information, as defined in Paragraph 3 of Part 1 of Schedule 12A to the Act, would be disclosed and the public interest in maintaining the exemption outweighs the public interest in disclosing the information:

 

-       for Minute items 8 and 9 below.

                         

8.

Equity Portfolio Review pdf icon PDF 68 KB

To be presented by Aon Hewitt

Additional documents:

Minutes:

 A report by Head of Investment, Risk and Commercial Finance – Resources was presented by Messrs Daniel Carpenter and Mark Searle of Aon Hewlett. The report reviewed the Fund’s asset allocation to equities and presented options to transfer holdings to alternate strategies either onto London Collective Investment Vehicle (London CIV) or to index tracker funds. The presentation considered how the portfolio is currently structured, what areas the Panel should consider and what LCIV was able to offer. The Panel noted that the core allocation is currently actively managed which attracted high fees and suggested considering moving to passive management which would attract lower fees and possibly lower returns. There was also a recommendation from Aon Hewitt to move more funds to emerging markets, while retaining the blend of styles.

 

The Chair thanked the presenters.

 

Resolved that the options to be explored further from other existing equity managers are noted.

 

Voting - unanimous

 

9.

Fund Manager Presentation - London Collective Investment Vehicle (LCIV)

Minutes:

A presentation by Will McBean and Larissa Benbow on behalf of London Collective Investment Vehicle was circulated at the meeting.

 

The Chair thanked the presenters

 

10.

DRAFT Pension Fund Annual Report 2018/19 pdf icon PDF 68 KB

Additional documents:

Minutes:

A report by the Head of Investment, Risk and Commercial Finance – Resources was presented by Anthony Huggett. The Pension Fund Annual Report had been produced to keep scheme members and other interested stakeholders informed about the administration and performance of the Pension Fund and to comply with Regulation 57 of the Local Government Pension Scheme Regulations 2013 (England and Wales). It was noted that publication was required by regulation by 1 December. The Funds accounts had been audited by the Council’s auditors, Grant Thornton.

 

Resolved that

 

(1)  the Pension Fund Annual Report for 2018/19 including the audited financial statements are approved; and

(2) authority is delegated to the Director, Corporate and Commercial, in consultation with the Chair of the Pension Panel, to make final amendments to the annual report as required before publication.

 

Voting - unanimous

 

11.

LGPS Good Governance Survey pdf icon PDF 78 KB

This report provides an update on the LGPS Scheme Advisory Boards (SAB)

survey on governance structures for Councils pension funds.

Additional documents:

Minutes:

A report providing an update on the LGPS Scheme Advisory Board’s (SAB) survey on governance structures for Council’s pension funds was noted.

12.

Review of Work Programme pdf icon PDF 58 KB

To update the Panel on the proposed work programme for the December 2019-February 2020

Minutes:

A report by Head of Investment, Risk and Commercial Finance – Resources updating the Panel on the proposed work programme for the December 2019 – February 2020 meetings was presented by Anthony Huggett.

 

Members were alerted that the date of the December meeting was likely to be brought forward to allow for the Triennial Valuation results to come to the Panel before being submitted to the Pension Board and the Employer Forum.  The Chair also asked Panel members to reply to an email sent from Democratic Services seeking confirmation of a date for a Panel Briefing Session on ESG which is due to be scheduled in October.

 

The Panel noted the programme

 

 

13.

Urgent Items Authorised by the Chair

Minutes:

 

Review of the structure of the equity portfolio

 

Options

remain actively managed or consider passive

 

Emerging markets – allocation?

 

meet with the various equity managers available on the CIV with a particular focus on core, growth and value managers in order to replicate the current equity structure through the London CIV

 

meet with emerging market and sustainable equity mangers available on the London CIV to provide more detailed training to aid decisions on emerging markets and a sustainable investment policy