The Dumfries and Galloway Council Pensions Sub-Committee discussed the Council's Pension Fund Governance Policy Statement, the Council's Pension Fund Risk Register, an update on the Local Government Pension Scheme, the Pension Fund's investment strategy, and the performance of the Council's investment managers in the third quarter of 2024. The Pensions Board did not approve the Pension Fund Governance Policy Statement, but noted all other items.

Pension Fund Governance Policy Statement

The Pensions Sub-Committee approved the Council's Pension Fund Governance Policy Statement, which is a requirement of the Public Service Pensions Act (Scotland) 2018¹. The Board will use this document to demonstrate to the Pensions Regulator that they are meeting their legal duties.

However, when the decision was referred to the Pensions Board, they voted by a majority of 4-1 not to support the Sub-Committee's decision to approve the policy. The Board's objections to the policy are not recorded in the minutes. The meeting was adjourned to allow the two groups to discuss the issue further.

When the meeting was reconvened, it was agreed that the Governance Policy Statement would be reviewed by a Short Life Working Group, who would also review feedback on the document and consider how the Pension Board Constitution should be updated to align with it.

The Public Service Pensions Act (Scotland) 2018 requires all Scottish local authorities to produce a governance policy statement for their pension funds.

The Sub-Committee also noted that the Council would need to make changes to its Scheme of Administration and Delegation to Committees to align with the new policy. These changes would need to be considered at the Council's next Review of Standing Orders Sub-Committee, and if approved, by a meeting of the Full Council.

The Governance Policy Statement will be reviewed by this Sub Committee and Board on an annual basis as outlined at paragraph 4.12 of this report - Printed minutes 05th-Dec-2024 10.30 Pensions Sub and Pension Board Joint (Item 9.2)

Pension Fund Risk Register

The Sub-Committee noted the updated Pension Fund Risk Register, which is reviewed every six months.

Local Government Pension Scheme

The Sub-Committee received an update on the implementation of actions from the meeting of the Pensions Sub-Committee held on 19 September 2024.

Pension Fund Update and Emerging Issues

The Sub-Committee received an update on the Pension Fund's investment strategy and discussed a number of emerging issues that could affect the fund's performance, including:

• The ongoing war in Ukraine.
• The global energy crisis.
• The risk of a recession in the UK.

The Sub-Committee also reviewed the objectives of its investment advisors, Hymans Robertson², for 2024, and agreed that these objectives would remain in place.

Hymans Robertson are an actuarial firm that advises pension funds on investment strategies.

Review of Investment Manager Performance for the Third Quarter of 2024

The Sub-Committee received a presentation from Columbia Threadneedle, one of the Council's investment managers, on their performance in the third quarter of 2024. The Sub-Committee noted the contents of the presentation.

This was a private session of the meeting, and so the details of the presentation have not been made public.