Decision details

The Head of Fund updated the Board on decisions made by the Pension Fund Committee at the meeting on the 15^th September 2017 in relation to reports in Part I of the agenda and highlighted the following.

a)  Lancashire County Pension Fund - Admission and Termination Policy

The Committee had agreed that an approach based on the yields available on corporate bonds at the date of exit would be adopted to set a discount rate as this was a recognised approach used by a number of other LGPS Funds, based on publically available information, and was similar to the approach used to calculate pension liabilities in employers accounts.

A minor amendment was also agreed regarding the existing charging structure for new admission agreements and academies joining the Fund which would involve additional interest charges where initial pension contributions were paid to the Fund late.

It was noted that the revised Policy was subject to a 3 month consultation period with employers and that a further report would be presented to the Committee in March 2018.

b)  External Audit – Lancashire County Pension Fund Audit Findings Report
  2016/17

It was reported that the Committee had noted the contents of the Audit Findings report for the LCPF Accounts for 2016/17. The Chair drew attention to the auditor's comments that they would provide an unmodified audit report in relation to both the audit opinion and audit opinion on the annual report.

c)  Responsible Investment

The Responsible Investment Working Group established by the Committee had met in September and was due to meet with representatives from LAPF in November to discuss areas where the two authorities can align their policies in order to strengthen the Local Pension Partnership and assist with future pooling.

d)  LCPF - 2017/18 Q1 Budget Monitoring Report

The Committee had noted the analysis of variances between actual results and the budgeted income and expenditure for the period 1^st April to 30^th June 2017, as set out in the report. The board recognised that the value of the Fund had increased as had the associated investment management expenses.

e)  Supply of LCPF Custodian Service

The Committee had agreed to appoint an independent specialist firm to assist the Fund in developing a specification for the custodian services and assist in the evaluation of potential tender responses from the independent open OJEU compliant procurement exercise to appoint a provider of custodian services for 3 years, with effect from the 1st April 2018.

Resolved:

1.  That all the reports considered by the Pension Fund Committee on the 15^th September, 2017 and subsequent decisions are noted.

2.  That any recommendations from the Responsible Investment Working Group are presented to the Board for consideration before being submitted to the Pension Fund Committee.

3.  That a report be presented to the next meeting of the Board to enable it to review the following key areas in relation to the LCPF budget.

·  Cost savings

·  Productivity gain

·  Risk reduction

·  Service improvement

·  Performance