Agenda and minutes

Apologies had been received from Ken Davison. It was noted that Phil Triggs was unable to attend.

Any Member of the Committee, or any other Member present in the meeting room, who has a disclosable pecuniary interest, in a matter to be considered at the meeting is reminded to disclose the interest to the meeting and to leave the room while any discussion or vote on the matter takes place.

Members are also reminded that if they have any other significant interest in a matter to be considered at the meeting, whether registered or not, which they feel should be declared in the public interest, such interests should be declared to the meeting. In such circumstances Members should consider whether a member of the public, with knowledge of the relevant facts would reasonably regard the interest as so significant that it is likely to prejudice their consideration or decision making. If the Member considers that to be the case, they should leave the room while any discussion or vote on the matter takes place.

There were none.

The minutes were accepted as an accurate record and signed by the Chair. It was noted that Strictly Education had been established some years ago and was no longer a ‘new’ payroll provider.

Duncan Derbyshire summarised the report.  He commented that by June, recruitment of permanent staff to fill the positions of the Head of Payroll, Pensions and HRMI and, Pensions Operations Manager was expected.

At the request of the Chair, he commented on the position of Strictly Education and noted that this borough was less affected than other local authorities by this payroll provider’s poor performance. Responding to a query on year end data, he reported that meetings had been held with schools and he was confident that data could be collected directly from employer organisations if payroll providers were unable to provide this information.

He confirmed that the contract with Hampshire would cease at the end of March and be replaced by the Oracle system which would combine human resources and payroll functions as an in-house provision. This would benefit the Council with easier access to payroll information and greater control over processes.

The Board noted that previously transfers of data by payroll providers had not always run smoothly and hoped all possible measures were in place to ensure the process was problem free.

Duncan Derbyshire agreed to inform Jagdeep Birdi by the end of March of the details of the payroll provision for the schools in the transfer of systems in-house.

Action: Duncan Derbyshire

 The report and the Key Performance Indicators in appendix 1 were noted.

Julia Stevens commented on the update and reported no unexpected movements in recent valuations.

She provided a direct property investment update referring to 4 property purchases so far this year. These included the Homebase property which had been signed off at the end of January with no vacant units expected. The rent review of the IO Centre in Barking and the Audi property had also been signed off.

Julia Stevens commented on the target for direct property investment of 20% of assets currently worth £1.9 million. The timescale for achieving this investment had been altered by the pandemic as well as the availability of the right type of property for investment. The Investment Committee regularly focused on progress towards meeting the target.

The report and appendices were noted.

At the request of the board, Julia Stevens summarised in some detail the decision by the Investment Committee at its 4 February meeting on a zero contribution for 1 year from the employer. She noted there could be a need to draw down funds from elsewhere gradually over the year. She confirmed the zero contribution from the employer would not affect the ability to pay pensions. 

The report was noted.

Julia Stevens reported on the approach taken by the Investment Committee over its decision for a pension zero-contribution to the Fund from the employer for 1 year. She commented on the position mid-way through the actuarial triennial valuation, the actuary’s assessment and, she referred to the absence of a certificate for a zero-percentage contribution from the actuary. The Committee in making its decision, had had regard to the actuary’s views and to the legal advice provided by counsel. She confirmed a draw down of 0.5% only would be needed to compensate the Fund for a zero contribution which would have a minor if any impact on cash flow.

The Board noted how important it was for clear communication concerning the impact of the zero-contribution decision even if it would make no difference to the ability of the Fund to pay pensions not least as pension details were included on school staff payslips. The pension team would email Jagdeep Birdi the likely impact on Academies of the zero-contribution decision.

Action: Julia Stevens

The Chair asked that the risk register include that of acquiring temporary accommodation for use by RBKC residents via the direct property portfolio and the challenge of securing a reliable rental income.

Action: Julia Stevens

Julia Stevens commented on progress towards amalgamation of funds which was under consideration by the government. Phil Triggs had discussed the issue with the Chief Executive of LCIV (London Collective Investment Vehicle). Direct property investments could not be pooled in any future amalgamation. No response had been received to the consultation on this proposed initiative. The Chair asked that the Board be kept informed on this matter with a briefing to the next meeting if new developments had arisen.

Action: Julia Stevens

The report was noted.

(Each written report on the Agenda detailed above:

(i)     was made available for public inspection from the date of the Agenda;

(ii)    incorporates a list of the background papers which (i) disclose any facts or matters on which that report, or any important part of it, is based; and (ii) have been relied upon to a material extent in preparing it.  (Relevant documents which contain confidential or exempt information are not listed.); and

(iii)    may, with the consent of the Chairman and subject to specified reasons, be supported at the meeting by way of oral statement or further written report in the event of special circumstances arising after the despatch of the Agenda.)

There were none.

Julia Stevens gave a summary in the absence of the standard CBRE report which had not been provided for the 4 February Investment Committee meeting. Progress continued to be made although market valuations remained challenging. Cashflow from acquired properties remained positive. The Council’s property team were still seeking an investment opportunity in property suitable for temporary accommodation that was ready to use.