• Agenda

Minutes of Meeting of the Pensions Committee held in the Council Chamber, Council Headquarters, Glenurquhart Road, Inverness on Thursday 23 May 2013 at 10.00 am.

Present:

Dr D Alston, Mr R Laird, Mr C Macaulay, Mr A Mackinnon, Mr T Maclennan, Mr K MacLeod, Ms E Ward, Mr E Macniven

Non Member in attendance

Mr B Fernie

Officials in attendance:

Mr D Robertson, Head of Accounting & Budgeting, Finance Service
Mr C MacCallum, Payroll & Pensions Manager, Finance Service
Mr B Porter, Policy Manager (Budget Strategy, Policy and Taxation), Finance Service
Ms D Sutherland, Principal Auditor, Finance Service
Mrs L Dunn, Principal Administrator, Chief Executive’s Service
Ms A Macrae, Committee Administrator, Chief Executive’s Service

An asterisk in the margin denotes a recommendation to the Council.  All decisions with no marking in the margin are delegated to the Committee.

Preliminaries

In the absence of the Chair, the Clerk invited Members to appoint a Chair for this meeting.

Thereafter, Mr C Macaulay, seconded by Mr A Mackinnon, moved that Dr D Alston be appointed as Chair.

The Committee AGREED accordingly and Dr Alston took the Chair.

1.  Apologies for Absence
Leisgeulan

Apologies for absence were intimated from Mr D Fallows (Chair), Mrs C Carmichael, Mr N Donald, Mr J Ford, Mrs C Wilson and Ms L Mackay.

2.  Declarations of Interest
Foillseachaidhean Com-pàirt

There were no declarations of interest.

3.  Auto Enrolment Update
Clàrachadh Fèin-ghluasadach

There was circulated Report No. pc-05-13 (25kb pdf) dated 14 May 2013 by the Director of Finance which provided an update on progress being made in respect of implementation of Auto Enrolment.

It was confirmed that approximately 450 employees had been identified as falling into the category of being auto enrolled and that to date 109 employees had opted out of the scheme. It was expected that this number would rise over the three month opt out period but still fall short of the expected opt out rate. A further update on progress would be provided after the three month opt out period.

The Committee NOTED the terms of the report as circulated.

4.  Pension Fund Contributions and Administration
Tabhartasan agus Rianachd Maoin Peinnsein

There was circulated Report No. pc-06-13 (40kb pdf) by the Director of Finance which provided an update on the efficiency and accuracy of pension contributions paid to The Highland Council Pension Fund.

It was confirmed that, in terms of the performance, the majority of the performance targets had been achieved or exceeded. In regard to the performance indicators for the Administering Authority, it was noted that the issues identified would be addressed over the next twelve months by the newly appointed Communications and Technical Officer. Also, in relation to Scheme Employer performance, it was confirmed that performance on new start notification and retirement information, although at a high level, would be addressed over the next twelve months with a view to achieving the expected target.

The Payroll & Pensions Manager reported that the performance of the Administering Authority would be compared to the CIPFA benchmarking results to be published later in the year on the basis of which performance targets would be set for the following year.

The Committee NOTED the terms of the report as circulated.

5.  Internal Audit Review of Pension Fund Investments

There was circulated Report No. pc-07-13 (67kb pdf) dated 28 April 2013 by the Head of Internal Audit & Risk Management which referred to an audit of Pension Fund Investments undertaken as part of the annual plan for 2012/13. The Report summary and Action Plan has also been appended.

The Committee was advised that the final Audit report was one of Substantial Assurance and had concluded that the management of the Pension Fund complied with statutory requirements and the Council’s policy relating to Pension Fund investments and that issues identified from the Audit were minor in nature and had been addressed in the Action Plan.

In discussion, Members welcomed the fact that all the actions detailed in the Action Plan would be completed by 31 October 2013.

The Committee NOTED the terms of the report as circulated.

6.  Internal Audit Plan 2013/14

There was circulated Report No. pc-08-13 (22kb pdf) dated 8 May 2013 by the Head of Internal Audit & Risk Management which referred to the plan of work for the Pension Fund for the financial year 2013/14 which would focus on an audit review of Pension Fund contributions and work to support the Statement on Internal Control for 2012/13.

The Committee NOTED the Audit Plan for 2013/14 as circulated.

7.  Local Government Pension Scheme
Application for Admitted Body Status: Care Homes

Members were reminded of the request (which had been submitted to the meeting held on 22 February) from Parklands Highland Limited for admitted body status within the Local Government Pension Scheme.

At that meeting, Members had been advised that an application from “Parklands Highland Limited” (as the preferred bidder for the provision of New Care Homes in Tain and Muir of Ord) had been made to allow current employees to participate in the Local Government Pension scheme administered by Highland Council under an “Admission Agreement”.

The Admission Agreement was expected to be in place from July/August 2012 until no later than 31 December 2013.

In this regard, it was confirmed that the Resources Committee had agreed procedures on 17 April 2001 designed to protect the pension rights of Council employees who were transferred to an external provider of services and these procedures included the right for the successful contractor to become an Admitted Body within the Local Government Pension administered by the Highland Council subject to specific financial safeguards.

The terms of the contract agreed between the Highland Council and Parklands Highland Limited set out that the associated costs for the defined period would be met by the Council thereby satisfying that criterion. Under the contract, specific Highland Council staff would transfer to Parklands and as a result would have protected pension rights as described above.

Due to a delay in the contract signing, the service transfer had not occurred as anticipated in July/August 2012 and it was now anticipated that it would take place over the coming months. There was therefore a need to revise the Admission Agreement timescales previously noted by the Pensions Committee. All other aspects relating to the Admission Agreement remained the same other than the altered timescales.

The Committee NOTED the position.

8.  Governance Policy Statement

There was circulated Report No. pc-09-13 (147kb pdf) by the Director of Finance setting out an updated Governance Policy Statement for the Pension Fund which was one of a number of key policy statements which must be held by the Pension Fund.

Arising from the report, it was clarified that, while all Members of the Council were trustees of the Pension Fund, the function of operating and administering the Fund had been delegated to the Pensions Committee and Investment Sub-Committee.

Thereafter, the Committee AGREED the governance policy statement.

9.  Investment Sub Committee: Minutes of Meeting
Fo-chomataidh Tasgaidh: Geàrr-chunntas na Coinneimh

There was circulated Minutes of meeting of the Investment Sub-Committee held on 21 February 2013  the terms of which were APPROVED.

Arising from the Minutes, reference was made to the opportunities for alternative investments to pensions such as infrastructure, timber and commodities, and the mechanism by which this could be considered by the Council. In this regard, it was advised that the Investment Sub-Committee were to consider an item on investment strategy at their meeting (which would follow this meeting) and it was therefore AGREED that it would be more appropriate for this issue to be raised and discussed at that meeting.

The meeting closed at 10.20 am.