Agenda item

To submit the report of the Chair Of The Pensions Committee.

The amendments to the Inter-Authority Agreement (IAA) for the Wales Pension Partnership were accepted.

The Head of Legal, in consultation with the Head of Finance, was authorised to take the necessary steps to complete the agreement.

The Monitoring Officer highlighted the reasons for submitting this report, noting that back in July the Council had agreed, with the eight authorities that were part of the investment pool, to set up a company. Consequently, it was explained that the Joint Committee would remain but within a new system. It was highlighted that only the Full Council had the right to change the terms of reference, and that the role of the joint committee needed to be revised and the revisions approved before the company became operational and to ensure full scrutiny of its work. 

The Chair of the Pensions Committee noted that the Pensions Committee was cross-party and that they were unanimous in their support of the recommendation presented. She explained that a huge amount of work had been undertaken to prepare towards the change to be a company. She expressed that the matter was complex but the Committee had taken all possible steps to ensure that this decision was correct and fully scrutinised.

The report was submitted, stating that it sought approval to update the Inter-Authority Agreement between the eight Councils in Wales that administered Pension funds. The agreement had originally been approved by the full Council on 2 March 2017,

to establish an investment pool for Welsh pension funds. It was explained that amendments had been approved back in October 2021. It was stressed that the arrangement established under the system had worked well, with effective collaboration and the intention of saving investment managers' fees by investing on a larger scale.

However, the Westminster Government's "Fit for the Future" programme over the last eighteen months had meant that we had been forced to change. The Full Council in July approved the formation of a corporate entity wholly owned by the Wales Pension Partnership Administering Authorities, namely the WPP Investment Management Company, and to approve all other actions necessary to submit an application to the Financial Conduct Authority for authorisation of the company.

It was explained that the enforced changes had involved significant work along with time and resources. The new company was due to be operational by 1 April, 2026. However, there was one other agreement that the Council could not delegate to the Pensions Committee, which was the Inter-Authority Agreement. The amendments made to the agreement were highlighted, explaining that they had been the subject of work by legal advisers. It was expressed that there had been several discussions to keep track of the developments and they were therefore confident that it had been properly scrutinised.

Members were given an opportunity to ask questions and offer observations.

They expressed support for the decision and emphasised that there was little choice, but that the Pool hoped they would continue to work well together.

It was expressed that given the good performance of the pool, there were obvious risks to not signing this. It was explained that work had been carried out to ensure that we could continue to work as a partnership but the main concern was that this had been forced on us.

A member asked if there was an interest if a member was part of the pension scheme, it was stated that there was none.

RESOLVED

The amendments to the Inter-Authority Agreement (IAA) for the Wales Pension Partnership were accepted.

The Head of Legal Department, in consultation with the Head of Finance, was authorised to take the necessary actions to complete the agreement.