Investment and Pension Fund

Present

Devon County Council

Councillors Mrs Channon (Chairman), Drake, Clatworthy, Mrs Luxton, Mitchell, Owen, Wickham and Radford

Unitary and District Councils

Councillor Nicholls (Torbay)

Union and Retired Members

Mr. Franceschini, Mr. Lomax and Mrs. Parker

*86 Minutes

RESOLVED that the minutes of the meeting held on 9 May 2003 be signed as a correct record.

*87 Chairman's Introductory Remarks

The Chairman welcomed Councillor Nicholls to his first meeting and undertook to write to George Barnes, retired member who had been replaced by Colin Lomax, to thank him for his contribution to the work of the Committee.

*88 Dates of Future Meetings

The Committee noted the following dates for its meetings to be held at County Hall, Exeter at 10 am: 7 November 2003, 6 February 2004 (followed by the annual consultation meeting at 2.15 pm) and that the next Members' Training Day was on 28 November 2003.

*89 Application for Admitted Body Status

(a) Mowlem Plc

The Committee considered the report of the Director of Resources (DR/03/87) on an application from Mowlem Plc to be admitted to the Pension Fund in accordance with Local Government Pension Scheme Regulations in respect of those employed in connection with the provision of the services associated with the Exeter Schools PFI. The County Council as Administering Authority and Mowlem Plc were undertaking to meet the requirements of the regulations as outlined in the report.

RESOLVED

(i) that, subject to the provision of a satisfactory bond or indemnity (or other suitable alternative) to the value advised by the Actuary, approval be given in principle to the admission of Mowlem Plc to the Scheme and that a further report be submitted to this Committee when more details are known;

(ii) that the admission will be on an open basis in accordance with 'best practice'.

(b) Teign Housing

(Councillor Clatworthy declared a personal interest in this item by virtue of his membership of Teignbridge District Council)

The Committee considered the report of the Director of Resources (DR/03/88) on an application from Teign Housing to be admitted to the Pension Fund in accordance with Local Government Pension Scheme Regulations in respect of those employed in connection with the provision of services provided by Teign Housing. The County Council as Administering Authority and Teign Housing were undertaking to meet the requirements of the regulations as outlined in the report.

RESOLVED

(i) that Teign Housing be admitted to the Pension Scheme, subject to the provision of a satisfactory bond or indemnity (or other suitable alternative) to the value advised by the Actuary;

(ii) that the admission will be on an open basis in accordance with 'best practice'.

*90 Member Training

The Committee considered the report of the Director of Resources (DR/03/67) on various forms of initial and continuing training to assist members in making major policy decisions in accordance with Government guidance and regulations.

RESOLVED that the Director of Resources organise some basic training for

Committee members which can be built on later - in conjunction with neighbouring authorities if possible.

*91 Exclusion of the Press and Public

RESOLVED that under Section 100A (4) of the Local Government Act 1972 the press and public be excluded from the meeting for the following items of business on the grounds that they involve the likely disclosure of exempt information as defined in Paragraph 7 of Part 1 of Schedule 12A of the Act being information relating to the financial affairs of a person other than the County Council.

*92 Asset/Liability Study

(An item taken under Section 100A (4) of the Local Government Act 1972 during which the public and press were excluded)

The Committee considered the report of the Director of Resources (DR/03/89) on a Pension Fund asset/liability study undertaken by the Actuary and proposed changes in asset allocation to be made when market conditions were favourable.

RESOLVED

(a) that a central asset allocation benchmark of 70% equities and 30% bonds be adopted but with manager discretion to move up to 10% away from the benchmark on a tactical basis when appropriate and that the management agreements be amended accordingly;

(b) that the detailed asset allocation recommended by the Actuary be adopted as a long-term strategic benchmark but that its implementation be reviewed when market conditions are more favourable.

*93 Investment Performance

(An item taken under Section 100A(4) of the Local Government Act 1972 during which the public and press were excluded)

The Committee considered the Investment Management report of the Director of Resources (DR/03/62) on the performance of the Pension Fund (a) for the year to 31 March 2003 and (b) for the first quarter of 2003/04 to 30 June 2003, and on proposed future management arrangements for the in-house passive funds.

The Committee then received the quarterly management reports from UBS Global Asset Management and Capital Management.

RESOLVED

(a) that the Fund's performance be noted;

(b) that the recommendations on the management of the in-house passive funds be adopted as set out in the Director of Resources' report.

*94 Allocation of New Money

(An item taken under Section 100A(4) of the Local Government Act 1972 during which the public and press were excluded)

The Committee considered the Fund's continued overweight position in cash.

RESOLVED that the Director of Resources continue to have discretion to invest when market conditions are favourable.

*DENOTES DELEGATED MATTER WITH POWER TO ACT

The meeting started at 10.00 am and finished at 1.15 p.m.