The Dyfed Pension Fund Committee met on Wednesday, 11 March 2026, to discuss the fund's budget, investment strategy, and the Wales Pension Partnership (WPP). Key decisions included the approval of the 2026-2027 budget, the Dyfed Pension Fund Discretionary Notional Investment Strategy Policy, and the WPP Business Plan and Investment Management Company Business Plan.

Dyfed Pension Fund Pension Board Report

The Committee received an update from the Dyfed Pension Fund Pension Board, which met on 21 January 2026. The Board had focused on the risk register, particularly cyber security risks, and noted that similar motions regarding the conflict in Gaza had been considered by Carmarthenshire and Ceredigion County Councils, with Pembrokeshire County Council also considering a similar motion. The Committee resolved to receive the report.

Budget Monitoring and Cash Position as at 31 December 2025

A report detailing the fund's budgetary and cash positions as of 31 December 2025 was presented. It was noted that there was an overall underspend of £6.43 million compared to the budget, with variances in specific expenditure and income areas. The fund's cash position stood at £12.8 million, held by Carmarthenshire County Council for immediate cash flow requirements. The Committee resolved to receive the report and note the fund's cash position.

Dyfed Pension Fund Budget 2026-2027

The proposed budget for 2026-2027 was presented, with both expenditure and income budgets set at £155 million. The main expenditure item was benefits payable, estimated at £133.6 million, including a 3.8% pension increase. Total contributions were estimated at £100.2 million, a decrease from the previous year due to reduced employer contribution rates from 1 April 2026. This reduction means the fund will require more investment income, which will be closely monitored. The Committee unanimously approved the budget for 2026-2027.

Pensions Administration Report

An update on the Pensions Administration service was provided, highlighting the McCloud/Sargeant remedy which requires recalculation of pensions, death grants, and deferred benefits calculated since 1 April 2014 for specific members. The underpin calculation had been run for all relevant members, with recalculations to commence after the April pension increase exercise. The Committee was informed that the Pensions Regulator had not yet provided a go-live date for the new Pension Dashboard. The i-connect system was being implemented for Coleg Sir Gar and Dyfed-Powys Police, with plans to onboard other employers in the future, subject to resource availability. New regulations also necessitate the recalculation of death grants and survivor benefits issued since 2014 and 2004 respectively, which will be a labour-intensive task. The Committee resolved to note the report.

Breaches Report

The Breaches Report, prepared in accordance with the Pension Act 2004 and the Dyfed Pension Fund Breaches Policy, was received. Since the previous meeting, there had been two instances of late contribution payments, with no long-term implications. The report also reflected the automatic payment of refunds due for September 2025 to February 2026. The Committee resolved to note any breaches that occurred.

Dyfed Pension Fund Discretionary Notional Investment Strategy Policy

The Committee considered a report on the Discretionary Notional Investment Strategy Policy, which allows employers to request a lower-risk investment strategy. Eligibility criteria include being closed to new entrants, having no guarantor, and an expected remaining participation of five years or less. The Head of Financial Services explained that this policy aims to reduce volatility for exiting employers. The Committee unanimously approved the policy.

Business Plan 2026-2029

The Committee received the Dyfed Pension Fund Business Plan for 2026-2029. The plan outlines the fund's operations, governance, responsibilities, key documents, investment strategy, statistics, budget, and priorities. The Treasury and Pensions Investment Manager highlighted the mission statement: to deliver a secure, sustainable, and efficient pension fund that provides financial peace of mind to our members. The Director of Corporate Services suggested a Strategic Asset Allocation Review, noting that the last such review was in 2007. The Committee unanimously approved the Business Plan and the establishment of a Strategic Asset Allocation Review.

Risk Register

The Committee received the Risk Register, a working document that identifies and assesses risks related to the Dyfed Pension Fund's functions. Formatting changes were introduced to classify risks as red, amber, or green for improved readability. The Committee resolved to note the report.

Training Plan

The Committee noted the 2025-2026 Training Plan, detailing training events for members and officers. They then considered and unanimously approved the 2026-2027 Training Plan.

Wales Pension Partnership (WPP)

Joint Governance Committee (JGC) Update

The Committee received an update on the WPP Joint Governance Committee meeting held on 8 December 2025. Key points included the ongoing development of the WPP Investment Management Company (IM Co), the submission of the Stewardship Code report, the finalisation of the all-Wales Climate Report, and the upcoming impact report. Investment in the WPP Real Estate Sub-Fund 2 was on hold pending new regulations. The Committee resolved to note the update.

Responsible Investment Update - 30 September 2025

A Responsible Investment Update, prepared by WPP's Oversight Advisor, Hymans Robertson, was received. The Committee was informed that the Stewardship Code report had been submitted and that the WPP was a signatory. The all-Wales Climate Report was finalised and available on the WPP website. The Committee resolved to note the update.

Business Plan

The WPP operational Business Plan for 2026/27 was presented. This plan outlines the priorities and objectives of the WPP Constituent Authorities and the financial budget for the period. The new governance structure from 1 April 2026, including the establishment of an FCA-regulated Investment Management Company (IM Co), was detailed. The Committee was advised that the work plan would transition to the IM Co in 2027/28. The Committee unanimously approved the WPP Business Plan.

WPP Investment Management Company Business Plan

The Committee received the WPP Investment Management Company (WPP IM Co) Business Plan for financial year 2026/27. FCA authorisation was nearing completion, with the IM Co on track for creation on 1 April 2026. The plan detailed the company's strategic objectives, governance, and a total budget of £9 million for 2026/27, an increase from the initial projection due to staffing costs. The Independent Advisor requested that the Key Performance Indicators (KPI) sheet include a section on investment performance. The Committee unanimously approved the WPP IM Co Business Plan.

Updated Responsible Investment Policy

The Committee received an updated Responsible Investment Policy for the WPP. This update includes an Exclusion Policy, making the WPP one of the first pools with such a detailed policy. The Committee unanimously resolved to approve the WPP's Exclusion Framework and update the Fund's Responsible Investment Policy accordingly.

Exclusion of the Public

The Committee resolved to exclude the public from the meeting during the consideration of the following items due to the presence of exempt information.

Robeco Engagement Report 1 July 2025 - 30 September 2025

Following the application of the public interest test, this item was considered in private. The Committee received the Robeco Engagement Report, which detailed engagement activities and provided case studies on transition minerals. The Committee resolved to note the report.

Independent Advisor Performance & Risk Report to 31 December 2025

This report was considered in private. It informed the Committee of investment managers' performance and provided global market background. The Committee resolved to note the report and approve the recommendation within it.

Northern Trust Performance Report to 31 December 2025

This report was considered in private and provided performance analysis at a total fund level and by investment manager. The Committee resolved to note the report.