Agenda and minutes

To agree the procedures for the operation of hybrid meetings.

RESOLVED –

THAT the Guidance on Hybrid Meetings be agreed.

Apologies for absence were received from Steve Worrall and the Chair confirmed that the meeting was quorate with three members present.  

In the interest of transparency Councillor Olszewski declared that he was a Member of the London Pension Board Authority (LPFA) Board and that it was not connected to the work of this Board.

Vinothan Sangarapillai declared that he was an active member of the Camden pension scheme. 

Broadcast of the meeting

The Chair to announce the following: ‘In addition to the rights by law that the public and press have to record this meeting, I would like to remind everyone that this meeting is being broadcast live by the Council to the Internet and can be viewed on our website for twelve months after the meeting. After that time, webcasts are archived and can be made available upon request.

If you have asked to address the meeting, you are deemed to be consenting to having your contributions recorded and broadcast, including video when switched on, and to the use of those sound recordings and images for webcasting and/or training purposes.’

Any other announcements

Broadcast of the meeting

The Chair announced that “In addition to the rights by law that the public and press have to record this meeting, I would like to remind everyone that this meeting is being broadcast live by the Council to the Internet and can be viewed on our website for twelve months after the meeting. After that time, webcasts are archived and can be made available upon request. 

? 

If you are seated in the Committee Room or participating via Teams, you are deemed to be consenting to having your contributions recorded and broadcast, and to the use of those sound recordings and images for webcasting and/or training purposes.”

The Chair also announced that the agenda items would be considered in the following order - after item 8 on the agenda, item 10, item 11, item 9 and then the remaining agenda items.   

There was no urgent business.

To approve and sign the minutes of the meeting held on 19^th October 2022.

RESOLVED –

THAT the minutes of the meeting held on 19^th October 2022 be signed and agreed as a correct record. 

Report of the Executive Director Corporate Services

The report presents the results of an exercise to estimate the Fund’s maturity (the balance between benefits paid and contributions received). When payments exceed receipts the Fund is considered to be mature.

The Pension Committee, at its meeting on 5 December 2022, noted the contents of the report.

This report has an appendix which contains information exempt within the meaning of Schedule 12A to the Local Government Act 1972 and is not for publication. The appendix has therefore been circulated to Committee Members only.

If the Committee wishes to discuss the contents of a closed exempt appendix it may pass the proposed resolution identified at the end of the agenda to exclude members of the public and the press from the proceedings for that discussion.

Consideration was given to a report of the Executive Director Corporate Services that had been considered and noted by the Pension Committee at its meeting on 5 December 2022.

The report provided the results of an exercise by the fund’s actuary Hymans Robertson to estimate the fund’s maturity, which had been undertaken by  analysing receipts and payments to the fund. Fund maturity is reached when contributions from employers and employees are less than expenditure on benefits paid out to members of the fund (including expenses paid out).  Hymans Robertson had been able to report that the fund was broadly cash neutral and would remain as such until 2028, with a forecast for 2034 of an increasingly cash flow negative position. It was noted that high or low inflation levels would impact the pension fund and that the current high inflation had been factored into the modelling of the fund. The actuaries would continue to keep the fund under review and the Board noted that it would continue to receive the prudent judgement of the scheme advisor on issues relating to the maturity of the fund. The information in the accompanying PART II report was noted and it was,  

RESOLVED

THAT the report be noted. 

Report of the Executive Director Corporate Services

The report sets out revisions to the Funding Strategy Statement (FSS) which establishes how scheme employers in the Pension Fund are treated. It sets out how employer liabilities are measured, the pace at which these liabilities are funded and how employers or pools within the Fund pay for their liabilities.

The Pension Committee, at its meeting on 5 December 2022, noted the contents of the report.

This report has an appendix which contains information exempt within the meaning of Schedule 12A to the Local Government Act 1972 and is not for publication. The appendix has therefore been circulated to Committee Members only.

If the Committee wishes to discuss the contents of a closed exempt appendix it may pass the proposed resolution identified at the end of the agenda to exclude members of the public and the press from the proceedings for that discussion.

Consideration was given to a report of the Executive Director Corporate Services that set out revisions to the Funding Strategy Statement (FSS).

The FSS governed how employer liabilities were measured, the pace at which these liabilities were funded and how employers, or pools of employers, paid  for their own liabilities. The FSS must be reviewed and issued for consultation during each triennial valuation and the administering authority was required in the preparation, maintenance and review of the statement, to have regard to the guidance published by CIPFA.

The report and Part II report were noted and it was,   

RESOLVED

THAT the report be noted. 

Report of the Executive Director Corporate Services

Climate Action is one of the principal Investment Beliefs of the Pension Fund. The Fund and Council recognise that we are facing a climate and ecological crisis. We must do everything possible to limit the impact of climate change whilst protecting and enhancing our natural environment.

Carbon footprints measure the carbon equivalent tonnage of greenhouse gases which impact on global warming within the portfolio. The Fund is concerned about climate change and how this might impact investments. This report updates on the Carbon Footprint of the Pension Fund’s equity assets and also presents information on other asset classes.

The Pension Committee, at its meeting on 1 March 2023, noted the contents of the report.

Consideration was given to a report of the Executive Director Corporate Services that provided an update on the Carbon Footprint of the Pension Fund’s equity assets and also presented information on other asset classes.

The Council had committed to do all that it could in order to make Camden a zero-carbon borough by 2030, twenty years ahead of national targets set within the UK Climate Change Act. The Pension Fund also shared the Council’s aim of reducing carbon and moving to a net zero carbon economy.

Measuring the carbon footprint of pension portfolios allowed comparisons to be made with global benchmarks, helped identify priority areas and actions for reducing emissions, and tracked progress in making those reductions. The Camden Pension Fund had been annually reporting on the carbon footprint of the fund since 2017.

The move of the fund to a lower carbon footprint had been achieved against a background of a better funding position, demonstrating that the fund could  achieve strong returns while reducing the overall carbon footprint. 

Climate Action was one of the principal Investment Beliefs of the Pension Fund. The Fund and the Council recognised the issues being faced by a climate and ecological crisis and the need to do everything possible to limit the impact of climate change, whilst protecting and enhancing the natural environment.

The Chair of the Pension Committee addressed the issue of the climate emergency. The need to increase information on the debate, the challenge of how the fund decarbonises the portfolio, the importance of encouraging more green investments and calculating indirect emissions of newer and greener investments?  Including how to share and communicate complex messages like the conflict between assets – e.g. holding investments in electric vehicles that required mining to provide the materials for their technical components.  

There were many challenges in addressing the issue of carbon footprints and a system change in approach was key to achieving the changes that were needed.

RESOLVED

THAT the report be noted. 

Report of the Executive Director Corporate Services

The Pension Fund is required to produce an Annual Report under the Local Government Pension Scheme Regulations 2013. This report presents the 2021/22 Annual Report.

The Pension Committee, at its meeting on 5 December 2022, noted the contents of the report.

Consideration was given to a report of the Executive Director Corporate Services that provided an outline of Camden’s governance and management of the Local Government Pension Scheme and an update on the cost of administering the scheme. The report also included an update on investment policy and performance for the past year, including a review of investment markets, individual managers’ performance and details of the Fund’s investments and asset allocation.

The Board heard from the Chair of the Pension Committee about his reflections on the work of the committee in the last year; the impact of Covid19 on member training and the encouragement to a mainly new committee membership to participate in the many training opportunities that were available to support their understanding and build knowledge.  Steps to support and encourage gender balance, women of colour and diversity in the finance function remained an area of focus.    

The Pension Committee had noted the reduction in pension contributions  and this was an area that would continue to be monitored.  

The Board discussed that Camden had been the first borough to analyse the pension fund by gender, with initial findings showing that for every £1 received by men, women received 75p.The next step in the analysis would look at those not joining the scheme and how career breaks and caring responsibilities had contributed to the gap. Part time working and the Cost of Living Crisis were  factors that should also be considered.      

Board members mentioned that the take-up of the option to reduce pension contributions was low amongst staff. That other factors affecting pension benefits included, that not all staff had spent their whole career working for a local authority and age when joining the scheme would also impact a pension.  

There was much work to be done in analysing the factors affecting staff pensions. Creative solutions were needed to help bridge the gender gaps and the Chair of the Pension Committee Chair would work with Human Resources, the unions and Cabinet on what those solutions could be.

The Chair of the Pension Committee was thanked for attending the meeting. 

RESOLVED

THAT the report be noted. 

Report of the Executive Director Corporate Services

The Pension Board has responsibility for assisting the Pension Committee in ensuring compliance with the Scheme Regulations, other legislation relating to governance and administration, and the requirements of the Pension Regulator. The Pension Board must also ensure the effective and efficient governance and administration of the scheme.

The report summarises the items presented and decisions made at the Pension Committee meetings on 5 December 2022 and 1 March 2023.

Consideration was given to a report of the Executive Director Corporate Services that set out the Board’s role as the Scheme Manager to ensure the 

effective and efficient governance and administration of the scheme and provide oversight of governance of the administration. The report provided a summary of the reports and decisions made at the preceding Pension Committee meetings and each of the meetings were further outlined for the Board.  

The following was discussed in response to the aspects of the reports that had been considered by the Pension Committee:

·       Longevity - the noteworthy impact of the decrease in life expectancy which would result in decreased liability for the fund, however in more broad terms it was a worrying statistic that the age for dying/average age for death had seen a decrease in recent years.

·       Gender Inequality – with research showing that for every £1 contributed by men the pension fund equivalent for women had been 75p, which placed them at a financial disadvantage during their retirement. In addition the  breakdown of the pension membership showed that there were far fewer women members.  

·       ESG - There was a decreasing amount of the pension fund being invested it fossil fuels.   

·       Engagement – Members of the Pension Committee Members had been encouraged to participate in the training that was available to increase their knowledge relating to their roles on the committee.   

·       That there had been some impact on the pension fund caused by the volatility of the financial markets because of the GILTs held by the pension fund.    

·       In response to the table on page 447 of the agenda, indicating that the property portfolios summary was struggling - that the Pension Committee had given consideration to whether the targets were accurate and would continue to monitor them.   

Officers confirmed that the Pension Committee was happy with the progress on London CIV. At the annual meeting of the CIV in January  there were 33 London Boroughs invested in the CIV. One or two boroughs had indicated that they wanted to leave but they were required to give two years notice to withdraw.   

RESOLVED

THAT the report be noted. 

To note the provisional date and time of the Board meetings in the next municipal year.

·       3pm on Wednesday 18^th October 2023

·       3pm on Tuesday 16^th April 2024  

RESOLVED –

THAT the following meeting dates and start time for the Board in 2023/2024   be noted:

·       3pm on Wednesday 18^th October 2023

·       3pm on Tuesday 16^th April 2024  

There was no such business.