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No. | Item | ||
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APOLOGIES To receive
any apologies for absence Minutes: Apologies were received from
Councillors Goronwy Edwards (Conwy County Borough Council), Simon Glyn, Peredur Jenkins, John Pughe Roberts and Robin Williams (Isle of
Anglesey County Council) |
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DECLARATION OF PERSONAL INTEREST To receive
any declaration of personal interest Minutes: None to note |
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URGENT ITEMS To note any
items which are urgent business in the opinion of the Chairman so that they may
be considered Minutes: It was highlighted that a question had been received from a member of the public who was present at the meeting. It was noted that no specific
item had been scheduled to discuss responsible investing, although the Annual Report of the Pension fund 2020/21, to be discussed at
the Annual Meeting of the Pension Fund on
25-11-21, would refer to responsible investment matters. It was noted that the individual could be invited to the annual meeting. |
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The
Chairman shall propose that the minutes of the meeting of this committee held
on 21 October 2021 to be signed as a true record Minutes: The Chair accepted
the minutes of the meeting held on 14 October
2021 as an accurate record. |
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GWYNEDD PENSION FUND'S FINAL ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2021 AND RELEVANT AUDIT PDF 201 KB
Additional documents:
Decision: To accept the
report Approve ·
Statement
of Accounts 2020/21 (post audit) ·
'ISA260’
report by Audit Wales in respect of Gwynedd Pension Fund ·
The
Chair of the Committee (17-11-21) and the Head of Finance Department to certify
the Letter of Representation electronically Minutes: Yvonne Thomas and Garmon Williams from Audit Wales were welcomed to the meeting. Submitted - a report and a Statement
of Accounts for the Gwynedd
Pension Fund 2020/21 (post audit), by the Head of Finance Department providing details of the Pension Fund's financial activities for the year ending 31st March 2021. Members were reminded
that a draft of the accounts had been submitted to the meeting held on 24 June
2021 and that there were no
significant changes following an audit
by Audit Wales. Yvonne Thomas (Audit Wales) was invited to submit the 'ISA260' report. She noted that
the auditors intended to issue an unqualified
audit opinion on the accounts this year, once
the Letter of Representation
had been signed. It was explained that the auditors could never provide complete
assurance that the accounts had been accurately stated, but rather that they worked to a level of ‘relevance’. A relevance level of £25.3 million had been specified for this
year's audit, in an attempt
to identify and rectify audit misstatements
that could otherwise lead to misleading the user of the accounts. Attention was drawn to the following headings: ·
The effects of Covid-19 on this year's
audit ·
There were no uncorrected misstatements found in the accounts ·
Although there were some
errors in the draft financial statement, they had now been amended ·
The submitted information was of high quality and was extremely positive The Auditors were thanked
for their cooperation and thorough work. Appreciation was expressed for the commitment and the accuracy of the work and the Investment Manager and the team were thanked
for preparing the accounts. During the ensuing discussion, the following observation was noted: ·
The report was encouraging and positive – and provided confidence that things were
going well. In response to a question regarding Additional Voluntary Contributions (AVC - Note 3) and the rationale for investing
this scheme's assets separately to the Pension Fund's assets, it was noted that externalising this element was a general matter and that contributions
were the choice of fund members. However,
it was reported that the number of members subscribing to AVC was increasing,
which led to significant advisory work. Subsequently, a request for a budget to fund a post to support this element would
be submitted to the Committee
in 2022. RESOLVED: To accept the report Approve ·
Statement of
Accounts 2020/21 (post audit) ·
'ISA260’
report by Audit Wales in respect of Gwynedd Pension Fund ·
The Chair of
the Committee (17-11-21) and the Head of Finance Department to certify the
Letter of Representation electronically |
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OBJECTIVES FOR INVESTMENT CONSULTANTS REVIEW PDF 117 KB To consider the report, note progress
and approve future objectives Additional documents: Decision: DECISION To accept the
information and to note progress Approve the investment consultants’ objectives for
the coming period - Committee Chair to sign the statement of compliance before
7 January 2022 Minutes: Submitted - the report of the
Investment Manager, reporting
on progress against current objectives and requesting that the Committee review and approve the objectives for 2022. It was reported, following a review of the investment consulting and fiduciary management markets, that the Competition and Markets Authority noted that Pension
Scheme Trustees should set objectives for their investment
advisers, and clearly stipulate the expectations upon them. Reference was made to the current objectives as well as the progress
made against those objectives in 2020/21. Attention was drawn
to the new objective added for 2022 in response to a world-wide increase in this field
- Developing the Committee's
understanding of climate risk and Environmental, Social and Governance
Criteria (ESG). The objective's aim
was to ensure that the investment consultants developed the Committee’s understanding of ESG and climate risk matters,
to support the implementation
of governance requirements
of the Task Force on Climate-related Financial Disclosures (TCFDA) and help the Committee to understand and manage climate
related risks within the strategy. Training had been provided in October
2021 and further training would be arranged as required. It was reported that Hymans
was delivering good work, providing comprehensive quarterly reports for the investment panel, offering practical and prompt
advice, responses and correspondence, and performing in accordance with
the objectives. It was explained
that Hymans had responsibility to the Fund as advisers and as an actuary, and
had ensured key results and returns
over the years. It was noted that the arrangement ensured that the partnership between Hymans and the scheme was transparent. The Vice-chair reiterated that the company provided a good service and met the objectives that were set by the Committee. The members expressed their thanks for
the report. RESOLVED ·
To accept the information and to note progress ·
To approve the investment consultants’ objectives for the coming period - Committee Chair to sign the statement of compliance before 7 January 2022 ·
To consider a formal forward programme of items for the Pensions Committee for the year |
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TREASURY MANAGEMENT 2021 - 2022 MID YEAR REVIEW PDF 400 KB To consider the report for information Decision: To accept and note
the information Minutes: Submitted, for information, a report highlighting the Council's actual Treasury
Management activity during the current financial year. It was highlighted that,
during the six months between 1 April and 30 September 2021, the Council’s
borrowing activity had remained within the limits originally set. There were no
defaults by banks in which the Council had deposited money. It was reiterated
that it was estimated that the Council's investment income exceeded the
expected income in the 20121/22 budget. In the Pension Committee on 25 March 2021, it had been resolved to permit
the surplus funds of the Pension Fund to be pooled and co-invested with the
Council's overall cash-flow. The successful vaccine rollout programme had been credit
positive for the financial services sector in general, and the subsequent
improved economic outlook had meant that some institutions had been able to
reduce provisions for bad loans. It was reported that the period had been
challenging, but with the lifting of restrictions, there had been more activity
in the second quarter of the year. It noted that Arlingclose
had extended the maximum period of some investments to 100 days. It was explained that £10m of the Council's investments were held in
externally managed strategic pooled property and equity funds where short-term
security and liquidity were lesser considerations. Although the pooled capital value of £9.243m
was less than the initial investment of £10m, the investments were made in the
knowledge that the capital values were unstable at months, quarters and even
years; but with the confidence that the total returns over a three to five-year
period would be higher than the interest rates on cash. Consequently, the
objectives would be realised through the stability of mid-term prices. Reference was made to the use of the Debt Management Office as an
investment vehicle that had modestly higher returns than others and that was
flexible, easy and secure to use. Although the rates were low and the outlook
was weak and unstable, it was reported that the Council was investing as much
as possible in a challenging period; it was continuing to do its best to make
gains by spreading risk, but was also operating carefully in line with Arlingclose's advice. It was confirmed that all the treasury management activities that were held
during the period fully complied with the CIPFA code of practice as well as the
Council's Treasury Management Strategy Statement, and in the context of
investment training, officers had attended investment training with Arlingclose and CIPFA during the period that was relevant
to their posts. It was highlighted that Arlingclose expected the
Bank Rate to increase in Q2 2022, due as much to the Bank of England's
aspiration to move out of emergency levels as to the fear of inflationary
pressures. Investors had factored in a number of increases in the Bank rate to
1% by 2024 in their valuations. Although Arlingclose
believed that the Bank rate would rise, it would not be as high as market
expectations. It was reported that £25m of ... view the full minutes text for item 7. |