Present:-

Devon County Council:-

Councillors Gilbert (Chairman), Brook, Dezart, Edgell, Greenslade, Hannon, Hill, Hosking, Randall Johnson and Squires.

[NB: Councillor Hannon present from Minute 51 onwards]

Unitary and District Councils:-

Councillors Mahony and Parker

Union and Retired Members: Non-Voting Observers:-

Mr Franceschini and Mr Lomax

Apologies:-

Devon County Council: Councillors Radford and Wright

Union and Retired Members: Ms Rimron

*47 Minutes

RESOLVED that the minutes of the meeting held on 16 May 2014 be signed as a correct record.

*48 Pension Fund Annual Report and Accounts

The Committee considered the report of the County Treasurer (CT/14/55 - text only | pdf | supplementary information CT/14/55) together with the Annual Report and Accounts document. The Annual Report included a summary of the performance of the Fund s external managers, including stewardship activity and the market outlook going forward, followed by the Statement of Accounts.

Peter Lappin from Grant Thornton was present for this item and reported there were no major issues with the Pension Fund and when completed the audit opinion would be presented to the Audit Committee for approval.

It was MOVED by Councillor Brook, SECONDED by Councillor Randall Johnson and

RESOLVED that the Pension Fund Annual Report and Accounts for 2013/14 be adopted, subject to the inclusion of a supplementary note explaining the increase in pension scheme membership, and subject to the approval of the Statement of Accounts by Council s Audit Committee.

(NB: In accordance with Standing Order 32(4) Councillor Edgell requested that his abstention from voting on this decision be recorded.)

*49 Administering Authority Administration Discretions

The Committee considered the report of the County Treasurer (CT/14/56 - text only | pdf | supplementary information CT/14/56) outlining proposed amendments to the existing administering discretions, and recommendations relating to new discretions which had been introduced since the last revision in 2011.

It was MOVED by Councillor Greenslade SECONDED by Councillor Randall Johnson and

RESOLVED

(a) that amendments to the existing administration discretions as outlined in Annex A and the recommendations relating to new discretions as outlined in Annex B and Annex C be approved;

(b) that the impending employer consultation regarding Administration Strategies be noted.

*50 Funding Strategy Statement

The Committee considered the report of the County Treasurer (CT/14/57 - text only | pdf | supplementary information CT/14/57) outlining the latest revisions to the Funding Strategy Statement, following consultation with the Fund Employers and reflecting updated regulations and practice.

In response to Members questions the County Treasurer advised that the funding strategy document encompassed all relevant risks, including the impact of current global issues and the impending referendum on Scottish Independence.

It was MOVED by Councillor Gilbert, SECONDED by Councillor Randall Johnson and

RESOLVED that the revised Funding Strategy Statement be approved and adopted.

*51 2014/15 Training Plan

The Committee considered the report of the County Treasurer (CT/14/58 - text only | pdf | supplementary information CT/14/58) outlining proposed training for Members of the Committee and the Pension Board when established in April 2015, in accordance with the CIPFA Code of Practice.

The Chairman drew the Committee s attention to the two training events which had been arranged for 30 October 2014 and 21 November 2014 and asked Members to note the dates in their diaries.

It was MOVED by Councillor Parker, SECONDED by Councillor Brook and

RESOLVED that the 2014/15 Training Plan be approved and adopted.

*52 Investment Management Report

The Committee considered the report of the County Treasurer (CT/14/59 - text only | supplementary information CT/14/59) on the current Fund Value and Asset Allocation against target. The County Treasurer reported that the Fund return for the last quarter was 0.3% above the Fund s customised benchmark and also ahead of the Local Authority Peer Group average.

In response to Members questions the County Treasurer advised that following last year s actuarial valuation the Fund Actuary would be producing a revised long term cashflow forecast and a report would be brought to the next meeting of the Committee.

It was MOVED by Councillor Parker, SECONDED by Councillor Brook and

RESOLVED that the Investment Management Report and compliance with the 2014/15 Treasury Management Strategy be noted.

*53 Pension Fund Risk Register

The Committee considered the report of the County Treasurer (CT/14/60 - text only | pdf | supplementary information CT/14/60) and risk register which highlighted the key risks relating to the Pension Fund, the current processes in place to mitigate this risk and improvements planned to provide further assurance.

The Committee discussed the intrinsic nature of risk involved in the management of pension funds, and acknowledged the key role of the investment managers who were employed to mitigate this risk.

It was MOVED by Councillor Brook, SECONDED by Councillor Randall Johnson and

RESOLVED that the Pension Fund Risk Register and the actions proposed to mitigate risk be noted.

*54 Applications for Admitted Body Status

The Committee noted that the following applications for admitted body status had been approved under delegated powers :

(a) 4Children

(b) Churchill

(c) Chartwells (part of Compass)

(d) Delt Shared Services Limited

(e) South West Heritage Trust

(f) ISS

(g) Sanctuary Housing

(h) Strata

*55 Dates of Future Meetings

21 November 2014

27 February 2015

*56 Exclusion of Press and Public

RESOLVED that the press and public be excluded from the meeting for the following items

of business under Section 100(A)(4) of the Local Government Act, 1972 on the grounds that

it involves the likely disclosure of exempt information as defined in Paragraph 3 of Schedule

12A of the Act, namely information relating to financial or business affairs of a person other

than the County Council and disclosure of which would be likely to inhibit the free and frank

provision of advice and exchange of views for the purposes of deliberation, in accordance

with Section 36 of the Freedom of Information Act 2000, by virtue of the fact that the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

*57 Investment Management Review

The Committee considered the report of the County Treasurer (CT/14/61) outlining alternative indexation options and proposals on the way forward.

It was MOVED by Councillor Edgell, SECONDED by Councillor Hannon and

RESOLVED

(a) that the Sarasin mandate be terminated with immediate effect;

(b) that the Fund Custodian, Northern Trust, be used as a transition manager to liquidate the Sarasin mandate;

(c) that the funds from the Sarasin mandate be invested on a temporary basis in the SSgA FTSE All World Equity Index Fund, while the procurement of an alternative indexation manager is undertaken;

(d) that a procurement exercise be undertaken for a 250 million alternative indexation mandate comprising a blend of value, volatility and quality indices;

(e) that the Committee use the services of JLT to assist with the selection process;

(f) that the interviewing process and final decisions be delegated to a panel comprising the Chairman, Vice Chairman, Councillor Brook and Councillor Randall Johnson, to make appointments in consultation with the Fund s Investment Adviser and the County Treasurer.

(NB: In accordance with Standing Order 32(4) Councillor Greenslade requested that his abstention from voting on this decision be recorded.)

*58 Independent Advisor Arrangements

Mr Harrison, the Fund s Independent Advisor and Mr Tyson left the room for this item.

The Committee considered the report of the County Treasurer (CT/14/62) on the proposed revised arrangements with regard to the Fund s Independent Advisor.

It was MOVED by Councillor Brook, SECONDED by Councillor Edgell, and

RESOLVED the current contract with AllenbridgeEpic for the services of an Independent

Advisor be continued for the next two meetings, on the basis that Mr Tyson attend as

substitute for Mr Harrison, and that the arrangements be reviewed in Spring 2015.

*DENOTES DELEGATED MATTER WITH POWER TO ACT

The meeting started at 10.00am and finished at 11.30am.

The Minutes of the Committee are published on the County Council s Website at:

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