Agenda item

[To provide an update on the work of the Fund in delivering a well governed scheme and to seek approval for the statutory Governance Compliance and Administering Authority Discretion Statements for 2019]

Rachel Howe, Head of Governance and Corporate Services reported on the main highlights from the update report on the work of the Fund in delivering a well governed scheme.  The Committee was asked to approve statutory Governance Compliance and Administering Authority Discretion Statements for 2019.

The Chair thanked everyone who took part in the AON Governance Review, the outcomes from which had been extremely positive.  He also referred to the Fund’s participation in the Pensions Regulators ‘deep dive’ into ten Local Government Pension Scheme (LGPS) funds to further their understanding of the risks and challenges faced by Funds.  The Regulator’s visit to the Fund had gone well and they were satisfied with how the Fund was managed and run. He looked forward to seeing the Regulator’s final report due to be issued in the summer.

The Director of Pensions agreed to circulate a link to the report from AON’s Governance Review to members of the Committee.

Malcolm Cantello (Unison) asked about the extent of the liaison with investment managers on the late trades reported during the quarter October to December 2018. Rachel Howe, Head of Governance and Corporate Services advised that the Funds’ custodian HSBC reported on the late trades and it was their action that led to the occurrences. The Assistant Director - Investment and Finance added that late trades could happen at any time and she undertook to follow up on the issues and report back to the Committee. The Chair informed the Committee that there was no detriment to the Fund due to the late trades but it was right that the Committee monitored the position and any impacts on the Fund.

In welcoming the increase in the production of Annual Benefit Statements (ABS) for Fund members from 70 % to 83% since the last meeting, Councillor Angela Sandison asked about the remaining 17%. The Director of Pensions reported that as part of the ongoing work to maximise production of benefit statements, the Fund had through dialogue with employers noted that of the total active membership records, 88% were believed to be eligible to receive a 2018 annual benefit statement. Steady progress was being made to close the gap.

Malcolm Cantello observed that undertaking training was missing from the ‘roles of the members of the Committee’ in the Governance Compliance Statement. It was agreed that this be included.

Resolved:

1.     That the Governance Compliance Statement be approved subject to the inclusion of the role for members of the Committee ‘To undertake training’

2.     That the Administering Authority Discretion Statement for 2019 be approved.

3.     That the top ten risks for this quarter and their movement be noted.

4.     That the quarterly compliance monitoring be noted.

5.     That the work of the Fund to continue maximising the production of Annual Benefit Statements for members be noted.

6.     That the ongoing engagement with LGPS Central in further developing the good governance and reporting in line with the Government consultation on investment pooling be noted.

7.     That the ongoing engagement with the Pensions Regulator in the review of the Fund’s Good Governance assessment be noted.

8.     That the outcome of the AON Hewitt governance review be noted.