Venue: Committee Suite - County Hall
Contact: Fred Whitehouse, Email: fred.whitehouse@devon.gov.uk 01392 381362
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Chair's Announcements Minutes: At the request of the Chair, those in attendance held a moment of silence in respect of Mary Davis, former County Treasurer of Devon County Council, who had recently passed, and expressed best wishes to Mary’s family. |
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Declarations of Interest Members of the Committee will declare any interests they may have in any item to be considered at this meeting, prior to any discussion taking place on that item.
The registrable interests of Councillors of Devon County Council, arising from membership of City, Town or Parish Councils and other Local Authorities will automatically be recorded in the minutes.
For details of District and or Town and Parish Twin Hatters – please see here: County councillors who are also district, borough, city, parish or town councillors
Minutes: The Chair reminded Members they should declare any interests they may have in any item to be considered, prior to any discussion taking place on that item. The details of District and or Town and Parish Twin Hatters was on the attached list - A list of county councillors who are also district, borough, city, parish or town councillors |
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Minutes of the meeting held on 13 September 2024, attached. Decision: RESOLVED that the minutes of the meeting held on 13 September 2024 be signed as a correct record. Minutes: RESOLVED that the minutes of the meeting held on 13 September 2024 be signed as a correct record. |
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Items Requiring Urgent Attention Items which in the opinion of the Chairman should be considered at the meeting as matters of urgency.
Minutes: There was no item raised as a matter of urgency. |
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Devon Pension Board PDF 111 KB Minutes of the Devon Pension Board meeting held on 21 October 2024, attached. Minutes: The Committee noted the minutes of the Devon Pension Board meeting held on 21 October 2024.
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Brunel Oversight Board PDF 152 KB Minutes of the Brunel Oversight Board meeting held on 5 September 2024, attached. Minutes: A comment was made by a trade unionist representative on the Committee regarding non-voting members of the Brunel Oversight Board, suggesting that increased influence by having a vote would be sensible given the ongoing discussions around Fund pooling arrangements, to ensure fund member representatives have a say in the future of these arrangements.
The Committee noted the minutes of the Brunel Oversight Board meeting held on 5 September 2024. |
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The following Notice of Motion submitted to the County Council by the following Councillors have been referred to the Investment and Pension Fund Committee in accordance with Standing Order 8(2) for consideration, to refer it to another Committee or make a recommendation back to the Council:
· Divestment from Pension Scheme (Councillor Hodgson)
A briefing note is attached (Report of the Director of Finance and Public Value, DFP/24/122).
Decision: RESOLVED that the Council be recommended to:
(a) Express solidarity with the innocent people directly affected by the ongoing situation in Israel and Gaza;
(b) Support the engagement activity undertaken on behalf of the Devon Pension Fund by the Brunel Pension Partnership with companies operating in high risk areas including Gaza and the West Bank to use their influence to promote positive human rights outcomes;
(c) Support the exclusion from investment portfolios of companies manufacturing controversial weapons (cluster bombs, biological and chemical weapons, antipersonnel landmines);
(d) Affirm the inclusion in the Pension Fund investment strategy of the allocation to the Global Developed Paris Aligned Equity Fund, as part of the commitment to work towards net zero investment portfolios; and
(e) Have officers and members engage in conversations with Brunel representatives and other pool members on ensuring that the UN Guiding Principles on Business and Human Rights, as set out in paragraph 3.10 of the report, are fully reflected in investment policies.
Minutes: Councillor M Lowry declared a personal interest in this item by virtue of being an ex-employee and current shareholder of Babcock International Group, who he was in receipt of a pension from.
In accordance with Standing Order 8, Councillor J Hodgson attended the meeting and spoke to this item.
This Notice of Motion had been submitted to the County Council by Councillor J Hodgson and had been referred to the Investment and Pension Fund Committee in accordance with Standing Order 8(2) for consideration, to refer it to another Committee or make a recommendation back to the Council. The notice of motion is recorded below:
Further to withdrawing over £2 million in investments from companies selling arms to Israel. Devon County Council now commits to investigating withdrawing the £84 million that remains invested through its investments and pension funds in such companies, including Rolls Royce (£1,951,241), Barclays Bank (£12,889,533), BAE Systems (£4,969,449), and Babcock (£360,850).
Devon County Council seeks immediate withdrawal of these investments, particularly in light of the tragic loss of over 20,000 children in Gaza. Our pension fund should not support activities contributing to such atrocities.
Devon County Council seeks to fully divest from these companies and to uphold values of peace, justice, and ethical responsibility.
The Committee considered the factual briefing note on the matter (the Report of the Director of Finance and Public Value (DFP/24/122)) which briefed members on the motion and referred also to a petition received by the Council with approximately one thousand signatories that was in support of the motion.
The report addressed an £84 million investment, referred to in the motion, by the Devon Pension Fund in companies that sell arms to Israel. It was highlighted that this seemed to be based on figures from 2021, since when significant changes to the Fund’s investment strategy had been made. The report also referred to the Global Paris Aligned Fund which excluded certain companies including on the basis of the manufacture of controversial weapons, which the report defined.
Also referred to was the UN Guiding Principles on Business and Human Rights as a framework on engaging with companies doing business in high risk regions, including Gaza and the West Bank.
Officers advised, in reference to the report, that the Devon Pension Fund was not directly invested in the companies concerned, and that it would not be possible to divest the shares. Additional exclusions from the Paris Aligned Fund could be requested; however this would present challenges as the Fund’s investments were based on a formula and had other investors, not just the Devon Pension Fund.
It was further explained to members that the Fund is a passive equity investment; this means that investment decisions are algorithmically dictated, and that there were no passive options currently available via Brunel that would omit the companies at issue. Moving to an active equity investment would mean higher fees, as these involve more of a human decision-making element, and possibly more risk of the Fund losing money.
Councillor Hodgson, ... view the full minutes text for item 38. |
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Audit Report on the Pension Fund Statement of Accounts 2023/24 PDF 8 MB Report of the Director of Finance and Public Value (DFP/24/123), attached.
Minutes: The Committee considered the Report of the Director of Finance and Public Value (DFP/24/123) which updated members on the progress of the external audit of the Council’s Statement of Accounts.
At the last meeting of the Committee, the Annual Report and Accounts for 2023/24 were approved pending approval of the Statement of Accounts by the Council’s Audit Committee, and completion of the external audit.
The audit had since been completed, and audit opinions issued.
Members heard from a representative of Grant Thornton, that there were no material changes to draft financial statements which was a positive sign; members should have confidence that the information provided to them by officers, which did require a level of forecasting and estimation, was therefore accurate throughout the year.
Members noted the report.
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Report of the Director of Finance and Public Value (DFP/24/124), attached. Decision: RESOLVED that the draft response to the Government consultation document attached at Appendix 1 be approved, subject to the amendments put forward to questions 27 and 28 (as detailed above). Minutes: The Committee considered the Report of the Director of Finance and Public Value (DFP/24/124), on the Government’s Local Government Pension Scheme consultation. The consultation sought views on proposals relating to the investments of the Local Government Pensions Scheme (LGPS) including asset pooling and UK and local investment. A draft response, submitted for approval by the Committee, was attached at Appendix 1 to the report.
Under the current proposals, officers advised that there were some concerns regarding the Fund being able to meet some elements of its fiduciary duty, despite the impact on Brunel being less than a number of other Fund pools.
Member concern was raised about the possibility of changing responsibilities that may see the Committee have less power to inform investment strategy and decisions. In relation to questions 27 and 28 (as in Appendix 1), which concerned pool governance and ensuring that “members’ views and interests are taken into account by the pools” (question 28), it was expressed that representatives of fund members on pool company boards should have direct voting powers and that an expression of this wish should be reflected in the consultation response.
It was MOVED by Councillor Gent, SECONDED by Councillor Atkinson and
RESOLVED that the draft response to the Government consultation document attached at Appendix 1 be approved, subject to the amendments put forward to questions 27 and 28 (as detailed above). |
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Investment Management Report PDF 9 MB Report of the Director of Finance and Public Value (DFP/24/125), attached. Minutes: The Committee considered the Report of the Director of Finance and Public Value (DFP/24/125). The Report outlined the Fund value and asset allocation, Fund performance, funding level, 2024/25 budget forecast, cash management and voting and engagement activity, as at 30 September 2024.
Highlights from the report included:
The Committee noted the report and compliance with the 2024-25 Treasury Management Strategy. |
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Investment Consultancy Contract Procurement and Investment Strategy Review PDF 202 KB Report of the Director of Finance and Public Value (DFP/24/126), attached.
Decision: RESOLVED that
(a) the commissioning of an external review of the Fund’s investment strategy and strategic asset allocation be approved; and that
(b) the specification and strategic objectives, as set out at Appendix 1 to the report, be approved. Minutes: The Committee considered the Report of the Director of Finance and Public Value (DFP/24/126). The report referenced the resolution of the Committee to undertake a procurement exercise for investment consultancy services, agreed June 2023. The report briefed members on the process undertaken and the outcome of the procurement exercise. It explained that, of six submissions, Redington were deemed to be the best candidate and were awarded the contract.
Following this appointment, it was proposed to commission a review of the Fund’s investment strategy and strategic asset allocation. A specification on the strategic investment review, and strategic objectives for consultants, was laid out in Appendix 1 to the report. The setting of strategic objectives for the investment consultancy provider was a requirement under Part 7 of the Investment Consultancy and Fiduciary Management Market Investigation Order 2019.
The Committee noted the appointment of Redington.
It was MOVED by Councillor Bloxham, SECONDED by Councillor Atkinson and
RESOLVED that
(a) the commissioning of an external review of the Fund’s investment strategy and strategic asset allocation be approved; and that
(b) the specification and strategic objectives, as set out at Appendix 1 to the report, be approved. |
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Report of the Director of Finance and Public Value (DFP/24/127), attached.
Decision: RESOLVED that the process and timetable for undertaking the 2025 Triennial Actuarial Valuation be approved. Minutes: The Committee considered the Report of the Director of Finance and Public Value (DFP/24/127). The report outlined the statutory obligations for administering authorities to complete an actuarial valuation of their Pension Fund every three years; and the resulting requirement for the Ministry of Housing, Communities and Local Government to undertake a ‘Section 13’ valuation to review the results of these actuarial valuations.
This report allocates ‘flags’ to each Fund across a number of areas as an indicator of performance, including compliance with regulations and long-term cost efficiency. The Devon Pension Fund achieved ‘green flags’ in all areas. Looking forward to the 2025 actuarial valuation, members heard that contributions need to be carefully considered to ensure that the Fund achieves ‘green flags’ moving forward, continuing its good performance.
The report provided a timeline for the 2025 actuarial valuation, with officers seeking the Committee’s approval of the timeline.
Members noted the outcome of the Section 13 Review.
It was MOVED by Councillor Atkinson, SECONDED by R Franceschini and
RESOLVED that the process and timetable for undertaking the 2025 Triennial Actuarial Valuation be approved. |
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Peninsula Pensions Administration Update and Performance Statistics PDF 371 KB Report of the Director of Finance and Public Value (DFP/24/128), attached.
Minutes: The Committee considered the Report of the Director of Finance and Public Value (DFP/24/128) on the performance of Peninsula Pensions
Members heard that the implementation of the revised Pension Administration Strategy, which was approved in April 2024, had helped Peninsula Pensions with procuring timely information from Fund employers which was, in turn, aiding performance in other areas.
Appendices 1 and 2 to the report provided a breakdown of administration performance relating to the Devon Pension Fund only, for the quarter ending 30 September 2024 (Appendix 1) and longer-term (Appendix 2). Appendix 3 showed the amount of work received over a 12 month period compared to previously and indicated a decrease in demand for this quarter.
In response to a member question around when data on individual employer performance would be presented to the Committee, it was explained that individual reports were presently being sent to employers; and that fund-level information would be worked on following, to be presented to members in the next quarter.
The Committee noted the report. |
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Employer Changes (a) New admitted bodies – The following application for admitted body status have been approved since the last meeting of the Committee: · 1 April 2024 - Plymouth City Council transferred their sports development unit to Plymouth Active Leisure.
(b) Employer Cessations – None
(c) New academy conversions and changes (all from 1 September 2024): · Branscombe C of E Primary School, Broadhembury CofE Primary School, Farway Cof E Primary School and Woodbury Salterton Primary School joined Link Academy Trust. · St Andrews C of E Primary School, Buckland joined Learning Academy Partnership SW. · Cullompton Community College joined Blackdown Education Partnership. · St Mary’s C of E Primary School, Bideford, South Molton United C of E Primary School and St Martin’s C of E Primary and Nursery School joined Ventrus Multi Academy Trust. · A transfer of 4 schools from Acorn Trust to First Federation took place. The schools involved were Axminster Primary, Membury Primary, Mrs Ethelston’s Primary and St Andrew’s Primary.
Minutes: The Committee noted the employer changes. |
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Dates of Future Meetings Future meetings are scheduled for:
· 20 Jun 2025 10.30 am · 19 Sep 2025 10.30 am · 19 Sep 2025 2.00 pm - Staff/Retiree Consultation · 28 Nov 2025 10.30 am · 27 Feb 2026 10.30 am
Minutes: The Committee noted the dates of future meetings of the Committee. |
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Exclusion of the Press and Public Recommendation: that the press and public be excluded from the meeting for the following item 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, information relating to the financial or business affairs of an individual (including the authority holding that information). Minutes: RESOLVED that the press and public be excluded from the meeting for the following item 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, information relating to the financial or business affairs of an individual (including the authority holding that information). |
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Brunel Reserved Matters Report of the Director of Finance and Public Value (DFP/24/129), attached (restricted). Minutes: The Committee considered the Report of the Director of Finance and Public Value (DFP/24/129) regarding a Brunel Special Reserved Matter, which was explained to be a policy issue set out in the Shareholders Agreement which required shareholder consent. The Director of the Finance and Public Value had delegated power to sign these off. As such the Committee noted approval of the request and next steps as laid out in the Part II report. |