Agenda and minutes

To receive any apologies for absence.

None.

To receive and note any declarations of disclosable pecuniary or prejudicial or personal interests in respect of any matters included on the agenda for consideration at this meeting.

(The personal interests of Councillors of Somerset Council, Town or Parish Councils and other Local Authorities will automatically be recorded in the minutes.)

Cllr Simon Carswell declared that he was in receipt of a Somerset Council pension.

The Committee is asked to confirm the minutes are accurate.

Resolved that the minutes of the Somerset Pensions Board held on 20 January 2023 be confirmed as a correct record subject to the replacement of ‘variation’ with ‘valuation’ in minute no. 139.

The Chair to advise the Committee of any items on which members of the public have requested to speak and advise those members of the public present of the details of the Council’s public participation scheme.

For those members of the public who have submitted any questions or statements, please note, a three minute time limit applies to each speaker and you will be asked to speak before Councillors debate the issue.

We are now live webcasting most of our committee meetings and you are welcome to view and listen to the discussion. The link to each webcast will be available on the meeting webpage, please see details under ‘click here to join online meeting’.

No members of the public had registered to speak.

To consider the papers provided to the Pensions Committee at their meeting of 10 March 2023.

The Board received a summary of the Pension Committee meeting on the 10 March 2023, with updates, and the following points were highlighted:

·         The terms of reference for the new Pension Fund Committee had been agreed and the Committee membership had been increased from
8 to 10.

·         The pension fund had been moved from the SAP system to
Microsoft 365.

·         The reduction in staff due to the formation od the unitary council was unlikely to have an impact on the pension fund.

·         Investment performance had been reviewed.

·         Admin performance had been reviewed and staff recruitment was a major topic. Peninsula Pensions currently interviewing for 7 vacancies, approximately 10% of their workforce.

·         The Communications Strategy was being worked upon.

·         Nothing had been received regarding the financial climate related disclosure reporting requirements for local government pension schemes.

·         They were still awaiting the outcome of the McCloud case.

·         Nothing formal had been received on changes to the pooling guidance or pooling regulations.

·         The Annual Employers meeting would now likely be taking place in the Summer or Autumn.

·         Whilst Brunel had approved their strategic objectives and budget there was currently an impasse over a proposed new remuneration policy that the majority believed was necessary to overcome their recruitment and retention issues. Consequently, their governance structure and voting requirements was being looked at.

To consider this report from the Funds & Investments Manager.

The Board was advised that an informal joint session, involving members of both the Board and the Committee, was planned for later in the year to have an in-depth discussion on each risk and to see if the current scoring was appropriate.

In response to concerns raised by the Board it was agreed that tweaks would be made to the following risks:

Ø  PF - Admin5 – to reflect an increase in likelihood.

Ø  PF - Inv4 – to reflect the specific recruitment issues that they faced.

To consider this report from the Funds & Investments Manager.

The Board considered their business plan and agreed to add a review of Brunel’s new Climate Change Strategy to the July 2023 meeting as it aligned with the already planned review of Brunel’s Carbon Metrics Report.

The Chair also reminded everyone that at the October meeting there would be an election of a Chair for the Pension Board, and that after having served for two terms, she would be looking for another member to step up.

To consider this report from the Funds & Investments Manager.

The Board considered the Funding Strategy Statement and in response to questions about the RPI assumption of 3.2% it was explained that whilst inflation was currently running at a much higher rate, they were looking at what was expected over a 20 year period.  In response to concerns that it was not just inflation but a succession of issues one after another, and whether there was anything pre-emptive that could be done the Officer confirmed that, as a fund, the only lever that they had was to request a fresh actuarial valuation as at the 31 March 2023 and that would take a year to do.

Whilst Somerset Council could put additional monies into the fund, it was highly unlikely considering the financial pressures that it was under. Cllr Liz Leyshon (Deputy Leader of the Council and Lead Member for Resources and Performance) confirmed that that was a fair summation and that putting more funding into the pension scheme was unlikely to find favour at the current time. The Board was advised that it was probably reasonable to wait until the next valuation.

In respect of the Funding Strategy Statement Members noted that the new proposed methodology would give a more prudent outcome over time and that it would be considered by the Committee before going out to the employers.

To receive a verbal update from the Funds & Investments Manager.

The Board received an overview of investment performance and, after discussing a number of points, felt that it would be helpful to know how the various Brunel funds were performing against each other. They requested that Brunel’s General Performance Report to be included within the Pension Board’s papers.

The Chairman may raise any items of urgent business.

None.