Minutes of Proceedings

Meeting of the NIAMPS Trustee Board held via MS Teams on Thursday 22 September 2022 at 9:30am

Present:

• Mr J Wells (Chair)
• Dr C Archibald MLA
• Mr P Catney

In attendance: Mrs P McClintock, Mr K O’Donnell (NIA), Mr A Crowe (Scheme Secretary), Mr M Pekacar, Mr C Ward, Mr Nam Le (GAD), and Mr N Burns (Deloitte)

1. STANDARD BUSINESS

1.1 Apologies

Mr S Dickson MLA.

1.2 Conflicts of interest

Noted that Mr Wells and Mr Catney were in the process of taking their NIAMPS benefits and would become pensioners of the Scheme.

1.3 Minutes of the Meeting on 31 March 2022

Approved.

1.4 Matters arising

1.4.1 McCloud – interaction with new retirements (inc. IHR)

Mr Pekacar advised that in respect of any retirements following the McCloud decision, members would be entitled to an uplift of benefits and back-payments when appropriate. He noted that in the current environment of high inflation, opting for final salary benefits might not always provide a better outcome for members.

Mr Pekacar also advised that other parliamentary schemes were not currently too far ahead of NIAMPS and none had yet written to members with a proposed remedy.

Finally, it was noted that nothing could be progressed for NIAMPS members until the IFRP was re-established, therefore, this topic should remain on agenda going forward.

1.4.2 Statement of Investment Principles (SIP)

It was noted that an updated SIP was considered and accepted by Trustees at the previous meeting.

Action: Mrs McClintock to confirm if there are any Assembly requirements in relation to approval of the SIP as this could be relevant to preparation of the Annual Report and Accounts.

1.5 Items from the Chair:

1.5.1 Christopher Stalford

Mrs McClintock confirmed that the payments due to Mrs Stalford had now been made.

2. CONSENT ITEMS

2.1 For noting

3. KEY REPORTS FOR DISCUSSION

3.1 Advice on Trustee Board composition

The Secretary advised Trustees that advice had been received from Eversheds on the options available to ensure that the NIAMPS Trustee Board remained quorate and able to continue to make the decisions required to fulfil their Trustee responsibilities. He summarised the three options:

1. for the existing Trustees to appoint a new trustee(s) by exercise of their statutory powers under the Trustees Act 1958. This would be permissible when the following criteria were met:
   - circumstances make it impractical to follow the normal trustee appointment process
   - there are no more than 3 Trustees remaining on the Board
   
   
2. for existing Trustees to apply to Court to appoint a new trustee(s)
   
   
3. for existing Trustees to apply to the Pensions Regulator to appoint a new trustee(s)

The Trustees noted the broad range of potential decisions that could be required as part of the normal operation of the Scheme and, therefore, the importance of the Board remaining quorate to enable them to continue to act in the best interests of scheme members.

Mrs McClintock advised that she had previously provided a paper to the Commission informing that legal advice was being taken on this matter.

Agreed: that option 1 was the most efficient and cost-effective approach.

Action: Mrs McClintock to speak with Party Reps and obtain nominations for new Pension Trustees to fill the three roles which will be vacant from 5 November 2022. Further, she will arrange a meeting with existing Trustees ahead of 5 November to communicate details of the nominations and to complete the required legal documentation.

3.2 Investments – Q2 2022

3.2.1 Fund Performance - 2022 Q2

Mr Ward reported that Q2 investment returns were not good and that every fund had seen negative returns. Overall, there was a decrease of 9% in the total asset value.

It was noted that pension benefit liabilities would have fallen over the same period and that the overall the impact on the funding level may not be significant.

Mr Ward also reported that the poor investment performance of Q2 had continued into Q3.

The dominant themes which had impacted investments markets were high inflation, labour shortages, supply chain issues and a global shortage of micro-chips. Monetary policy intervention and interest rates rises had not been effective in addressing these issues. However, Mr Ward noted that most forecasts see inflation coming back down in 1-2yrs.

3.2.2 Investment transition inc. Abrdn appointment

Mr Ward advised that Abrdn were finalising their review of the NIAMPS application form. The application and dealing instructions to effect the transfer of investments had been prepared in draft and Trustees would be asked to sign these when Abrdn had confirmed that all was in order with the paperwork.

Mr Ward advised that to mitigate the risk of losing returns on investments in the period between sell and buy transactions taking place (typically 2-3 days) the trades would be undertaken over several dealing dates - 5 or 6 dates with smaller amounts on any one date.

Action: Mr Ward to continue to coordinate with Abrdn and Mrs McClintock to obtain Trustee signatures on the documentation in due course.

3.3 Annual funding update – 31 March 2022

Mr Pekacar advised that the scheme funding position at 31 March 2022 had improved to £2.9m surplus (107% funded) on an actuarial funding basis (£3.0m deficit / 92% funded at 31 March 2020). He highlighted that the improvement largely related to actual investment returns achieved exceeding the expected returns that were assumed for the 2020 actuarial valuation.

Mr Pekacar noted the challenging economic and financial conditions faced since the interim funding date, as referred to earlier by Mr Ward, and dvised that these would be taken into Account at the next full actuarial valuation which would take place as at 31 March 2023.

4. OTHER ITEMS

4.1 Administration update

Mrs McClintock noted ongoing staffing issues with the outcome that her focus has been on meeting statutory requirements – including the Annual Reports and Accounts. She noted that an extraordinary meeting may be required to discuss the Accounts with the Trustees.

In relation to the Annual Benefit Statements (31 March 2022), Mrs McClintock noted that she doesn’t currently have the resource or the capacity to complete the required work. Mr Burns advised that there is no specific statutory deadline to issue these statements, although there have been a small number of member enquiries regarding the statements.

Action: Mrs McClintock to consider writing to members to advise that the Statements are being worked on, and to continue to try to find solutions to resourcing issues.

The Trustees noted that they would be happy to provide support in writing if it helpful to access further resource to assist Mrs McClintock. It was also queried whether there might be suitable talent available within the Assembly – in particular the Business Office.

5. ANY OTHER BUSINESS

The Chair advised that this would be his last Meeting as a Trustee and thanked fellow Trustees for their support and commitment and wished everyone well for the future.

6. DATE OF FUTURE MEETINGS

The next NIAMPS Trustee Meeting is scheduled for 15 December 2022 subject to availability of the Trustees and Assembly staff.