Archived decisions

Agenda Item: 5

HAMPSHIRE COUNTY COUNCIL

Decision Report :

EXECUTIVE SUMMARY

1) Summary of Decision Area:

1.1. To consider changes to the frequency of meetings of the Pension Fund Panel.

2) Issues Covered in Report:

2.1. This report considers changes to the timetable and arrangements for Pension Fund Panel meetings to allow members more time to consider the issues and discuss them with the fund managers.

3) Recommendation:

3.1. That an additional meeting in May is added to the existing pattern of Pension Fund Panel meetings as set out in Table 2 of the main report.

MAIN REPORT

1) Purpose of the Report:

1.1. This report outlines possible changes to the frequency of meetings of the Pension Fund Panel, following concerns expressed at the last meeting of the Panel about the duration of meetings and the lack of time available to consider the issues and question the investment managers.

2) Contextual Information:

2.1. The Pension Fund Panel currently meets four times each year, twice in May and twice in November. Originally, the first meeting was used to meet representatives of the investment managers and the second meeting to deal with `business' items only. With the increase in the Fund's investment managers from four to twelve in January 2007, the Panel has also had to meet managers at the second meetings.

2.2. The frequency with which the Panel currently meets each manager is determined by the risk associated with their portfolios, as the following table shows. The pattern was agreed by the Panel in May 2007 and reviewed in May 2008.

Table 1 - Current frequency of meetings with the managers
Twice-a-year
Aberdeen	Global equity portfolio with a high performance target
AllianceBernstein	Global equity portfolio with a high performance target
Newton	Global equity portfolio with a high performance target
SGAM	UK equity portfolio with a high performance target
Bramdean	Alternative investments adviser
Once-a-year
Aberdeen	UK equities portfolio with a low risk target
Schroders	UK equities portfolio with a low risk target
Western	Global bonds
CB Richard Ellis	UK direct and indirect property
Aberdeen (Goodman)	European indirect property
No meetings with the Panel
Legal & General	UK index linked bonds portfolio tracking the index
State Street	UK index linked bonds portfolio tracking the index

2.3. At present, Panel meetings start at 10 am with a 30 minute session to discuss the reports on the Agenda (60 minutes for the `business' meetings). Each investment manager is allowed a 45 minute session, with 20 minutes for their presentation and 25 minutes for the Panel's questions. Aberdeen are allowed 60 minutes when they report on both their global equities and UK equities portfolios. All meetings continue into the afternoon and can involve up to five sessions with investment managers.

3) Options

3.1. The following principles have been followed in preparing proposals for the future pattern of the Panel's meetings:

· increase the time allowed at the start of the meeting to discuss the reports from 30 minutes to 45 minutes for meetings with the investment managers, and from 60 minutes to 90 minutes for the `business' meetings

· ensure each Panel meeting ends before lunch

· reduce the maximum number of managers attending each Panel meeting to four, with three as the norm

· limit the number of managers attending the `business' meeting to one

· maintain the existing frequency with which each manager attends the Panel's meetings, except that Aberdeen would no longer meet the Panel in connection with the European indirect property portfolio and SGAM would meet the Panel once instead of twice.

3.2. The European indirect portfolio is now fully invested and there is less need now for the Panel to see Aberdeen for a portfolio that represents just 2% of the portfolio. Reducing SGAM to once-a-year brings them into line with the other two UK equities managers, although SGAM's portfolio has a higher risk profile. The County Treasurer would continue to meet both Aberdeen Property Investors and SGAM on a regular basis and would report any issues to the Panel. It would be possible to substitute SGAM for another manager at short notice if there were particular matters of concern, subject to SGAM's representatives being available on the relevant date.

3.3. These principles can be achieved by adding one further meeting to the schedule, for example, in May.

Table 2 - Proposed timetable for meetings with the managers
May meeting 1
9:30 to 10:15	45 mins	Discussion of reports
10:15 to 11:00	45 mins	Aberdeen global equities	six-monthly meeting
11:00 to 11:15	15 mins	Break
11:15 to 12:00	45 mins	AllianceBernstein	six-monthly meeting
12:00 to 12:45	45 mins	Newton	six-monthly meeting
12:45 to 13:30	45 mins	Bramdean	six-monthly meeting
13:30		End
May meeting 2
10:00 to 10:45	45 mins	Discussion of reports
10:45 to 11:30	45 mins	SGAM	annual meeting
11:30 to 11:45	15 mins	Break
11:45 to 12:30	45 mins	Schroders	annual meeting
12:30 to 13:15	45 mins	Western	annual meeting
13:15		End
May meeting 3 - `business' items
10:00 to 11:30	90 mins	Discussion of reports
11:30 to 11:45	15 mins	Break
11:45 to 12:30	45 mins	CB Richard Ellis	annual meeting
12:30		End
November meeting 1
9:30 to 10:15	45 mins	Discussion of reports
10:15 to 11:15	60 mins	Aberdeen global & UK equities	six-monthly meeting
11:15 to 11:30	15 mins	Break
11:30 to 12:15	45 mins	AllianceBernstein	six-monthly meeting
12:15 to 13:00	45 mins	Newton	six-monthly meeting
13:00		End
November meeting 2 - `business' items
10:00 to 11:30	90 mins	Discussion of reports
11:30 to 11:45	15 mins	Break
11:45 to 12:30	45 mins	Bramdean	six-monthly meeting
12:30		End

3.4. This should provide a more manageable timetable for the Panel, although the first meeting in May would be a long morning, running from 9:30 to 13:30. It could be reduced if the Panel decided to meet Bramdean just once a year, in November only. This could be justified if further investment in the alternative investments portfolio is to be put on hold. The Panel has previously established an informal sub-group to consider proposals from Bramdean and authorised the County Treasurer to agree investments that are consistent with the overall strategy for the alternative investments portfolio.

4) Recommendations:

Please see recommendations outlined on the Executive Summary

i:\. . . .\ian\docs\penpanel 211108 mgr mtgs.doc

CORPORATE OR LEGAL INFORMATION:

COMPREHENSIVE RISK & IMPACT ASSESSMENT:

Race and Equality Impact assessment

Race and equality impact assessment has been considered in the development of this report and no adverse impact has been identified.

Crime prevention issues

The County Council has a legal obligation under Section 17 of the Crime and Disorder Act 1998 to consider the impact of all the decisions it makes on the prevention of crime. The proposals in this report have no impact on the prevention of crime.