Agenda and draft minutes

There were no declarations of interest made on this occasion.

Resolved: That the minutes of the meeting of the Pensions Panel held on 3 December 2024 be confirmed and signed by the Chair.

·       Tuesday 15 July 2025

·       Tuesday 2 September 2025

·       Tuesday 2 December 2025

·       Tuesday 3 March 2026

All meetings are scheduled to start at 9.30am at County Buildings, Stafford

Resolved: That the minutes of the meeting of the Pensions Panel held on 3 December 2024 be confirmed and signed by the Chair.

Report of the Director of Finance

The Panel received a report from the Director of Finance seeking approval to the Staffordshire Pension Fund’s (‘the Fund’), Annual Investment Strategy (AIS) for the investment of internally managed cash.

Panel members were reminded that the Fund held a small strategic asset allocation to cash of 1.0%. This recognised that cash balances were needed for the day-to-day management of the Fund. The cash was managed by Officers in the County Council’s Treasury and Pension Fund Team, to provide liquidity and meet the Fund’s cash needs as they occurred. To allow for the practical management of operational treasury transactions each day, the choice over investments made was delegated to the Director of Finance.

The AIS for 2025/26 has been prepared on the same basis as in previous years, however, it was highlighted that the assumption that the management of cash would remain with the Fund, and would not be transferred to LGPS Central Limited, was now being challenged under the LGPS pooling agenda. In the November 2024 LGPS ‘Fit for the Future’ Consultation, MHCLG indicated that it saw cash as an investment asset that should be managed by the pooling company from 2026/2027. The Fund disagreed with this proposal and made this point in its recent consultation response, as it viewed its cash allocation as working capital, that should be managed in-house for reasons of operational efficiency and resilience.

Resolved: That the Staffordshire Pension Fund’s Annual Investment Strategy for the investment of internally managed cash in 2025/26, be approved.

Report of the Director of Finance   

The Director of Finance submitted a summary of the performance of the Fund, together with a portfolio of the Fund’s investments, as at 31 December 2024.

Over the quarter the Fund had returned +1.88%, underperforming its Strategic Asset Allocation benchmark return of +2.97%, by -1.09%, with all asset classes contributing to the underperformance. In absolute terms the Equity portfolio was the best performing asset class, and the Property portfolio was the highest performing asset class compared to benchmark. Infrastructure was the lowest performing asset class relative to benchmark.

It was reported that, as of 31 December 2024, the Fund had a market value of £7.86bn, an increase of c£140m since 30 September 2024.

In response to a question asking why there had been an increase in JP Morgan's market value from £48,000 to £97,000, despite disinvesting all assets from this portfolio, it was explained that the increase was due to the receipt of dividend payments and finalised outcomes of corporate actions that continued to flow through the account post disinvestment from JP Morgan. It was noted that this may cause some activity on the account for several months until the account is able to be formally closed.

Resolved: That the Pension Fund Investment Performance and the portfolio of investments for the quarter ended 31 December 2024, be noted.

Report of the Director of Finance

The Director of Finance provided a report relating to the Investment Adviser Objectives.

The Panel was informed that the objectives for Hyman's Robertson (Hymans) had been reviewed, and new objectives had been set for 2025/26. These objectives were high-level and tweaked annually based on the activities for the year. It was noted that the objectives for Hymans in respect of the provision of advice may change if the Government's consultation was put into law, potentially giving Hymans more of an oversight role of the LGPS Central Pool.

It was highlighted that objectives for the two Independent Advisers had also been set for the first time. It was explained that their role was to scrutinise, challenge and critically assess the advice provided by Hymans as the Fund’s Principal Investment Advisor.

Resolved: a. That the 2025/26 Investment Adviser Objectives for Hymans Robertson, as shown in Appendix 1, be approved.

b. That the 2025/26 Investment Adviser Objectives for the Pension Fund’s Independent Investment Advisers, as shown in Appendix 2, be approved.

Report of the Director of Finance

The Director of Finance submitted the Responsible Investment and Stewardship Report for the quarter ended 31 December 2024 to the Panel, which included the Local Authority Pension Fund Forum (LAPFF) Q4 2024 Quarterly Engagement Report (Appendix 1).

It was noted that the LGPS Central quarterly report, that was usually presented with this report would be included in their Annual Stewardship report, so was not available for this meeting.

The Panel was informed that the Fund had retained its status of being a signatory to the UK Stewardship Code for the second year. Thanks were given to Officers for their efforts in achieving this status. It was noted that there was an ongoing consultation which it was anticipated would make the process of becoming a signatory easier in the future; thus, encouraging more institutional investors to sign up to the Code.

It was explained that an updated Climate Change Strategy would be presented at the March Pensions Committee meeting. The targets set for 2030 had predominantly been met, and new targets were being developed in collaboration with Hymans and LGPS Central.

Focussing on the LAPFF report, it was noted that there had been some enquiries about the impact of the ongoing conflict in the Middle East, with discussions on divestment from companies in the Occupied Palestinian Territories. It was noted that Human Rights had been a significant focus in Quarter 4, and this aligned with the Committee's and Panel's previous discussions.

Resolved: a. That the content of the Responsible Investment and Stewardship report for the Quarter Ended 31 December 2024 (Q4 2024), be noted.

b. That the Local Authority Pension Fund Forum Q4 2024 Quarterly Engagement Report (Appendix 1), be noted.

The Chairman to move:

‘That the public be excluded from the meeting for the following items of business which involve the likely disclosure of exempt information as defined in the paragraphs of Part 1 of Schedule 12A of the Local Government Act 1972 (as amended) indicated below’.

Part Two

(All reports in this section are exempt)

Resolved: That the public be excluded from the meeting for the following items of business which involve the likely disclosure of exempt information as defined in the paragraph of Part One of Schedule 12A of the Local Government Act 1972 (as amended) indicated below.

The Panel then proceeded to consider reports on the following issues:

Presentation by Hymans Robertson

Northern Trust report for the quarter ended 31 December 2024 attached for information.

Report of the Director of Finance   

Report for the Director of Finance

Presentation and Report by Colliers Global Investors

Report of the Director of Finance

A presentation from LGPS Central