Issue - meetings

The item was introduced by Paul Higginbotham, who summarised the investment activity. Performance levels were either on track or slightly ahead, and value was being added by the Fund investing in good fund managers. There was an increased focus on investment in alternatives holdings, with five per cent of investments being made in private equities.

The amount of capital received was expected to increase over time; additionally, income was being generated by other investments. Two thirds of the capital had been invested, the majority of which was in existing assets. Members were told the cash balance stood at £55.8million, which was 2.1 per cent of the Fund’s value. This was split between a treasury account and another that handled capital movements. The CEM benchmarking for the Fund indicated that it had generated £23million in additional profit.

Paul Higginbotham said Funds were being encouraged to pool their assets, in light of imminent new legislation. The Warwickshire Pension Fund was already doing this by being part of the Border to Coast partnership and talks aimed at increasing the amount of pooling were taking place. This was being done to make further cost saving efficiencies. Councillor Ian Shenton noted the consultation in relation to pooling LGPS funds, stating that different local authorities and their associated pension funds would have different appetites for risk. Chris Norton said one of the main issues was it was unclear if Funds would have to further increase the amounts they had invested to support levelling up; for example, if a Fund had already invested five per cent into a certain asset viewed as supporting levelling up, it was unclear if they would be obliged to invest a further five per cent. Additionally no deadlines had yet been set for making those investments. Responding to Mike Snow, Chris Norton said there was evidence of cost savings being made by pooling.

The Chair said in the past there had been concerns about the politics associated with investments. He said some Funds had held off from making investments in companies with a presence or interest in Israel.

The Chair said the table at Appendix A would be more useful if the investments were listed in chronological order from the inception date. Newer investments could have lower figures associated with them, but this would be less concerning compared to a longer term investment that had lost value.

Members noted the contents of the report.