The Pension Committee noted the content of the Administration Update, Administration Strategy, Wales Pension Partnership Update, Quarterly Investment Performance Report, Risk Register Update, and the Training Update. They approved a recommendation to invest £125 million into the Wales Pension Partnership's Series II Infrastructure Programme with GCM Grosvenor¹ and £75 million into the UK Sleeve of the programme. They also approved a revised Breaches Policy and the Pension Administration Strategy.

Administration Update

The Committee noted that 1,211 members had registered for My Pension Online since August, bringing the total to 24,765. The Pensions Manager, Joanne Griffiths, reported that the target for My Pension Online registrations was 40%. She also discussed measures being taken to protect the fund from cyberattacks, which have been on the increase in recent weeks.

The committee were told that the fund was continuing its work on McCloud underpinning and had purchased the Heywood Pension Technologies Integrated Service Provider (ISP) solution² in order to connect to the Pensions Dashboard³.

Pension Administration Strategy

The Committee approved the Pension Administration Strategy. This strategy is intended to improve the administrative processes within the fund and will need to be revisited once the UK government has finished consulting on its Fit for Purpose plans for the LGPS.

The strategy was consulted on between 7th October and 15th November 2024. Only two responses were received, both from scheme employers, and their comments have been taken into account.

Wales Pension Partnership (WPP) Update

The Committee noted an update on the activities of the Wales Pension Partnership. The WPP's Joint Governance Committee last met on the 18th September 2024 and will next meet on the 10th December 2024.

As of the 31st October 2024, the Greater Gwent (Torfaen) Pension Fund had pooled approximately £3.412bn, or 77.7% of its assets under management with the WPP.

Quarterly Investment Performance Report

The Committee noted the content of the Quarterly Investment Performance Report. The fund posted a positive return of +1.66% in Quarter 3 of 2024, outperforming its benchmark by 0.10% and bringing the total fund value to £4.393bn.

With Sterling at near the height of its 52-week trading range (GBP/USD range: 1.23 to 1.34) and likely to appreciate further as US rates weaken, the Fund can be expected to “give back” some of the currency translation windfall it has enjoyed on any unhedged strategies since mid-2021.

Risk Register Update

The Committee noted the updated Risk Register. The register has been separated into two tiers: strategic and operational. The risk in theme review this quarter focused on administration and in particular the strategic risks:

• SR 1 - A serious cyberattack, leading to disruption to the discharge of administering authority functions
• SR3 - Failure to administer and comply with the Local Government Pension Scheme in accordance with the Regulations and The Pension Regulator’s New Code of Practice

Training Update

The Committee noted the Training Update and the annual training programme for 2024/25. The assessment of training needs for the fund was conducted as part of the Hymans Robertson National Knowledge Assessment. They were told that the fund is expecting to receive the results shortly.

WPP Real Estate

The Committee noted an update on the Wales Pension Partnership's Real Estate solution and approved a recommendation that 60% of the fund's real estate assets be allocated to UK real estate strategies and 40% to global strategies.

WPP Infrastructure Series II

The Committee approved a recommendation to invest £125 million into the Wales Pension Partnership's Series II Infrastructure Programme⁴ with GCM Grosvenor¹ and a further £75 million into a UK-only sleeve of the programme. The Series II programme is expected to launch in April 2025, following a first close on 31st March 2025.

The Series II programme will consist of 55% Primary Funds and 45% Secondaries and Co-Investments. 30-40% of the Series II programme, and 100% of the UK sleeve, will be invested in UK assets.

The UK Government has continued to encourage greater UK investment by pension funds and other institutional investors. The recent Ministry for Housing, Communities and Local Government (MHCLG)[^6] consultation has set a clear expectation for the LGPS to invest more in the UK via their respective LGPS pool operator, and to disclose this investment within annual reports.