The Pension Fund Committee of Swansea Council met on Wednesday 20 March 2024, approving several key documents including the Wales Pension Partnership Business Plan 2024-27 and the City & County of Swansea Pension Fund Business Plan 2024/25. The committee also noted internal audit reports on pension fund investments and administration, and a report on breaches.

Internal Audit Reports - Pension Fund Investments and Pension Fund Administration

The committee received and noted the findings of the internal audit reports concerning pension fund investments and administration. Both reports indicated a High assurance rating, signifying that the internal controls in these areas are sound and consistently applied. Due to these consistently high ratings, the regularity of these internal audits has been reduced to a biennial cycle. The report on pension fund investments found no recommendations were necessary, while the report on pension fund administration identified two low-risk recommendations, which have already been implemented. These internal audit reports are crucial as they inform the scope and testing undertaken by the external auditors, Audit Wales.

Wales Pension Partnership Business Plan 2024-27

The committee approved the Wales Pension Partnership (WPP) Business Plan for 2024-27. This plan outlines the WPP's priorities and areas of focus for the next three years, building on previous work. Key ongoing initiatives highlighted include the live tender process for the real estate investment program and the procurement process for a new operator contract. The plan also details the formulation of the annual WPP budget, with costs being recharged equally among the eight constituent authorities. The committee also noted the training plan for WPP personnel, which aims to ensure they have the necessary knowledge and understanding of pension regulations, pooling, and investment opportunities.

City & County of Swansea Pension Fund Business Plan 2024/25

The committee approved the City & County of Swansea Pension Fund Business Plan for 2024/25. This plan sets out the working framework for the fund's programme of work for the upcoming year. Key items within the plan include the ongoing review of the investment advisor and investment consultant contracts, which is expected to launch within the next month. A new initiative highlighted is the undertaking of cyber security war game testing, in collaboration with the fund's actuaries, to assess the effectiveness of existing security controls. The plan also addresses the pension fund's risk register and budget for the year.

Breaches Report

The committee received a report for information detailing any operational breaches that had occurred. The report noted a single instance of late contribution payment from a college, which was attributed to a staff member being on long-term sick leave and the covering individual missing the payment deadline. This was deemed a low concern as the college recognised the issue and the contributions were subsequently received. Other late payments were from smaller employers and were also considered low risk.

Investment Strategy Structuring Implementation

The committee approved delegated authority to the Deputy Section 151 Officer, in consultation with the Chair of the Pension Fund Committee, to implement the required investment structuring as dictated by the approved investment strategy. This decision was made during a closed session of the meeting.

Wales Pension Partnership Update

The committee noted the Wales Pension Partnership (WPP) Quarterly Update and Raid Log, which provided an update on the progress and work of the WPP. This information was presented during a closed session.

Wales Pension Partnership Operator Procurement

The committee approved the Wales Pension Partnership (WPP) Operator Procurement Recommendation Report. This decision was made during a closed session.

Investment Summary

The committee received an investment summary for information, which presented the asset valuation and investment performance for the quarter, year, and three years ended 31 December 2023.

Quarterly Investment Monitoring Report

Philip Pearson and Andre Ranchin from Hymans Robertson presented a quarterly investment and market update to the fund for information. The committee asked questions regarding the presentation's content.

Responsible Investment Policy

Philip Pearson from Hymans Robertson presented the Responsible Investment (RI) Policy for information. The policy outlines the underlying objectives of the RI Policy, the committee's beliefs regarding the fund, and expectations for the policy's implementation and assessment.

Fund Manager's Presentation(s)

A presentation was made by Julian Brown and Per Dohnal of Russell Investments. The committee asked questions regarding the presentation's content, and the presentation was noted.