Agenda item

To review and provide feedback on the report. 

The annual report (draft) was submitted by the Investment Manager. It was explained that the report provided details of the activities of the Pension Fund during the year ending 31 March 2025 and was completed in accordance with statutory guidance. Changes were highlighted in the requirements of the Scheme Advisory Board to identify and present the information through three categories - must, should and may. It was ensured that everything known as 'must' and 'should' had been included, unless the information was not available. As a result, it was explained that the annual report had increased in size as it included annual reports from the Board, the Pensions Committee, further information on administration statistics, and further information on pooling.

It was stated that the report was in the process of being reviewed by Audit Wales with a view to submitting it with the final accounts to the Pension Fund's annual meeting on 24 November 2025.

Gratitude was expressed for the report.

Observations arising from the ensuing discussion:

·        That the situation was healthy.

·        The team were congratulated on their good work.

·        The situation was evidence of good governance in a challenging economic climate.

·        The situation had improved significantly over the years - there was a need to try to avoid a situation of lowering and raising contributions.

·        The report was thorough and easy to read.

·        Accepted that it was not necessary to include the 'may' information category.

In response to an observation, that there were reductions for employers as a result of a valuation and if a buffer had been set, it was noted that the largest employers, given that the fund was 166% funded, had put in place a stabilisation mechanism and that other employers had an intention of doing something similar.

In response to a question that the Fund's direction was to reach a net zero target in 2050, but that the Council's Climate Strategy had set a net zero target by 2030 and why the conflict, it was noted that discussions had been held with officers, but that the Pension Fund's target was based on an in-depth analysis with a commitment to undertake reviews to try to bring the date forward. It was reiterated that 2030 was not an option for the Fund.

In response to a supplementary question as to whether there was a commitment to meet the 2050 target earlier, and if an interim target was considered, it was noted that further work was being carried out on the strategic objectives with Hymans looking at the assets to try to meet the target earlier. It was added that further adjustments would be likely following the establishment of an IMCo company that would take over the governance, advisory and value for money aspects. It was reiterated that there was no objection to the suggestion to consider an interim target as all pool members had the same attitude towards reaching the net zero target sooner.

In response to an observation that a record of the development of Pensions Committee members was included in the report and that a similar record should be implemented for members of the Pension Board, it was noted that a training scheme was in place for members of the Pension Board and that the Investment Manager kept a record of those developments. It was noted that the record of the Committee members was more formal.

In response to comments regarding the Fund's membership and the gap between contributors and the number of paid pensioners, and whether modelling work was being carried out on these trends, it was noted that Hymans was aware of the trends and was considering the impact of this into the future.

With reference to the key performance indicators (KPIs), it was questioned what was the reason for 'not reporting', and if there was a timetable/target to 'report'; it was noted that work was being done to meet the requirements. It was highlighted that Gwynedd's performance reporting method did not follow a process of completing a KPI (Gwynedd reporting on continuous improvement) and therefore the task needed to be adapted to meet the requirements. It was reiterated that tasks were set in a specific manner, but that Gwynedd did not record in the same way as CIPFA requirements for information. It was confirmed that the performance was good and met the requirements, but that the system needed to be adjusted to better highlight the performance.

In response to a question about 'information not available', (Communications KPI) it was noted that an example of this would be the use of the Council's new telephone system which had not yet been set up. The information would be more complete for next year.

RESOLVED

To accept the report and note the information