To consider the independent review report by Chris Buss.

The Panel considered the report regarding the outcomes of an independent review of

Pension Fund governance.

Ian Coleman, informed the Panel that following receipt of an adverse ISA260 report

issued on 6 December 2019 by Deloitte, the Borough’s external auditor, an independent review of governance was conducted.  Chris Buss, an experienced S151 and pension fund manager, undertook the review.  He was in attendance to present his review.

Chris Buss highlighted the key parts of the report.  The first part of the recommendation looked at council governance and all recommendations in paragraph 13 have been included in another report on this agenda.  the next section looked at the impact of pooling, more regard for responsibilities that remained with the authority needed due regard and were in the other reports recommendations as well. 

The next section was with regards to an investment that had become worthless but was still in the accounts.  This showed historical things such as a failure to declare interests, how someone became a director and how they were removed, the minutes of the body making these decisions were not recorded.

The next section looked at the role of the independent advisors following pooling.  This needed reviewing and rationalising.  The last one was how assets were valued, especially how a particular asset had been valued.

The recommendations within the review were included in a later paper on the agenda.

Cllr Hilton mentioned that the comment that the fund was a reluctant pooler was strange as the Panel went to Oxfordshire and Buckinghamshire with the objective of pooling before it was mandatory.  There was an issue between personalities with LPP but the Fund remained committed.  We joined LPP out of choice and have developed a good relationship. 

Cllr Bond mentioned that the report said there were concerns about 4 legacy assets but only 1 was mention in the report. He also asked about the actuary and taking audit work on trust, this asked a question about the role for councillors looking at audit reports as a form of governance, this would require appropriate training.  Chris Buss mentioned that the comment about members came from the comments made at the Corporate O&S Panel and the reduced time to audit the accounts, he felt the audited accounts should come to members and not the draft version.  With regards to training it was important that committee members had training to do their job.   With regards to the legacy assets only one was looked at as per terms of reference of the review. 

Cllr Da Costa mentioned that he had raised training at meetings.  he asked if a list of all the items could be provided as a checkpoint of what areas had been dealt with.  Chris Buss agreed and was pleased to see over half of them had already been addressed, officers may not agree with all of the recommendations. 

Alan Cross mentioned that the Pension Board would also be looking at this report and felt it was the right direction of travel that would be kept under review.

Adele Taylor said that following the recommendations of this meeting there would be an action plan produced and monitored.  Training for members was due to be discussed.

Cllr lovelock asked how we would reassure members that this historic issues had not resulted in the Fund losing money.  Chris Buss said that good governance may not have altered the decision to make particular investments.  Cllr Da Costa mentioned that members needed reassurance about investments.  Cllr Hilton mentioned that it was important to have the cash to pay pensions and the right investment strategy we had to be careful not to scare residents.

Cllr Kaiser asked how much had been written off by the assets.  Chris Bus said that they were still trading and they could go up in value, they were purchased at £40 million and the accounts now valued them at £2 million at the time of the audited accounts.  Cllr Hilton mentioned that it’s the portfolio of investments that counted, the asset in question still had value and continued to trade.

Resolved unanimously that: The Panel noted the report and considered and noted the Independent Governance Report at Appendix 1.