Contact: David Wilson, ext 7407

1. Introduction

1.1 The Pension Fund's business plan provides for an annual review of its Statement of Investment Principles (SIP). Normally this would be in the spring of each year. However, as there was so much business at the Panel's May meeting, and no urgent changes required, it seemed appropriate to defer the review to this meeting.

1.2 A revised draft of the SIP is attached at Appendix 1. Significant changes are shown in italics.

2. Summary of changes

2.1 The main changes are:

· The employer and member numbers have been updated to reflect the position at 31 March 2003.

· It states that a training plan for Panel members is underway.

· It includes several references to Harvey Cole's appointment as an independent adviser and sounding board to the Panel.

· It has been updated to reflect the termination of ISIS's contract (and will be further updated in the light of the Panel's decision on the future of the ethical portfolio - item 15 on this Agenda).

· It states that none of the Fund's managers now uses soft commission.

2.2 The Panel may wish to note that the Hampshire Fund's SIP has been judged by the Audit Commission to be one of the most comprehensive they have seen.

Recommendation

1 That the Panel approve the draft updated Statement of Investment Principles.

Section 100 D - Local Government Act 1972 - background papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

Published works.

Documents which disclose exempt or confidential information as defined in the Act.

TITLE FILE

None.