Minutes of Proceedings

Session: 2002/2003

Date: 05 May 2004

PRESENT: Mr M Carrick
Mr J Dallat
Mr J Kelly
Mr D McClarty

IN ATTENDANCE: Mr G Ballantine (Government Actuary’s Department), Mr J Gibson (Head of Procurement), Mr T Evans, Mr E Hobson, Mrs K McCartney, and Mr N Burns

1. STATEMENT OF INVESTMENT PRINCIPLES 

Mr Ballantine presented his paper on Review of Investment Strategy to the
Trustees.

The Trustees agreed to adopt option one of paragraph nine – a reduction in the equity content on a phased basis from its current level of 80% to perhaps 65% (e.g. gradual reduction over a 5-year period) The main reason for this more cautious strategy being the increase in the age profile of the members over the period. 

On the issue of Socially Responsible Investment the Trustees agreed that they should state within the criteria for a fund manager that it would be “desirable” for the new fund manager to conform to Socially Responsible Investment.

In terms of the development of a Common Investment Fund the Trustees agreed that no further action should be taken until April 2006 when the Inland Revenue are due to publish their proposals on a new tax regime on simplifying the taxation of pensions.

It was also agreed that Mr Ballantine would draft a Statement of Investment Principles for the new contract. 

2. TENDER FOR INVESTMENT MANAGER 

Mr Gibson informed the Trustees on the process involved in tendering for a new fund manager. Mr Gibson also pointed out that despite the need for precision in selecting the new fund manager, the extension to the existing contract is currently on a rolling month basis and it would be preferable to keep this period to a minimum.

In terms of expected service levels in the new contract the Trustees agreed that there was a need to specify the requirement for the new fund manager to provide accurate management information on a monthly, quarterly and annual basis.

The Trustees agreed that the performance of the new fund manager should be benchmarked against the league table produced by CAPS and consistent under performance should be addressed by switching to a new fund manager. Such a situation could be afforded by recruiting the new fund manager on a rolling one year contract containing a clause, which would enable the Trustees to give one months notice to a substandard performer.

The Trustees also agreed on the need to encourage applications from locally based organisations.

Mr Gibson then agreed to prepare a tender paper with a suggested critical path to be presented to the Trustees at the next meeting. 

3. DATE OF NEXT MEETING

It was agreed that the next meeting would be held in early June.

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