Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
By circulation
Date
26 January 2021
PRESENT
Edward Schuck (Chair)
Daniel Mussett
Sarah Park
Louise Edwards
Stephen Ward
Wayne Stechman
APOLOGIES
Nil
A paper entitled NPF Schemes Administration System Risk Review was circulated to the
Board for consideration on 22 January 2021.
Th
e paper requested approval to s 9(2)(i) and (j)
, to carry out a risk assessment in order to determine what action, if
an
y, is required in relation to the NPF schemes administration system (
PIMS system)
ei
ther now, or in the future, and to develop a future roadmap.
Management confirmed their view that s 9(2)(i) and (j) is well qualified to assist with this work
at a strategic level.
A copy of the engagement letter with s 9(2)(i)
and CV for s 9(2)(i)
were attached
to the paper.
The Board:
1.
NOTED the report.
2.
APPROVED the engagement of s 9(2)(i)
at an estimated cost is up to s 9(2)(i)
including GST.
3.
NOTED the previous engagement with
h
s 9(2)(j)
as been put on hold pending the
outcome of this proposed work.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
Philippa Drury
GENERAL MANAGER, SCHEMES
26 January 2021
1
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Level 12, the Todd Building, 95 Customhouse Quay, Wellington, telephone
or video conference via Zoom
Date
Thursday, 25 February 2021 commencing at 9.30 am
PRESENT
Edward Schuck (Chair)
Stephen Ward
Sarah Park
Louise Edwards
Wayne Stechman
Daniel Mussett (via Zoom)
IN ATTENDANCE
Simon Tyler
Philippa Drury
Paul Bevin
s 9(2)(a)
s 9(2)(a)
and s 9(2)(a)
for item 3.3 – 9.45 am to 10.20 am
APOLOGIES
Nil
Th
e Board initially met in the absence of Management.
All
Board members confirmed there were no specific interests to declare.
1.
MINUTES OF THE BOARD MEETINGS
Th
e Board
NOTED and
AGREED the minutes of the Board meetings held on 8 December 2020
an d 26 January 2021
.
2.
ADMINISTRATION
2.1 Matters Arising
The Board:
a)
NOTED the Matters Arising.
b)
REQUESTED the proposed schedule of investment manager presentations be tabled at
the next Board meeting and that the first presentation be from Devon.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
2.2 Long Term Work Plan
The Board
NOTED the Long-Term Work Plan is under development.
2.3 Interests Register
The Board:
a)
NOTED the Interests Register.
1
b)
NOTED a correction - Daniel Mussett’s appointment is as an Independent Member
of the Heretaunga Tamatea Settlement Trust Investment Committee effective
December 2020.
3.
KEY PAPERS
3.1 Chief Executive’s Overview
The Board:
a)
NOTED the report.
b)
NOTED Datacom has been invited to attend the March 2021 Board meeting.
c)
AGREED to change the June 2021 meeting to 24 June 2021, starting at 1.00 pm and
REQUESTED an updated invitation be sent to all Board members.
3.2 Health, Safety and Wellness Update
The Board
NOTED the Health and Safety Update and the dashboard.
3.3 MOF Annual Letter of Expectations
THE TREASURY
The Chair welcomed s 9(2)(a)
and s 9(2)(a)
to the meeting at 9.45 am to discuss with
the Board the Minister of Finance’s annual Letter of Expectations and the Responsible
Investment framework.
Letter of Expectations
a)
Treasury commented:
- The annual Letter of Expectations is following an evolutionary not a revolutionary
process and the structure and key messages are well formed. The messages are
common across all Crown financial Institutions (
CFIs).
- NPF is operating well and is fit for purpose, with risk appropriately managed and
controlled.
- The Minister of Finance is looking for ways in which Crown entities can partner and
be good citizens in support of overall Government objectives, specifically those in
relation to social needs, sustainability, housing and child poverty. It is recognised
there are differences between the other CFIs and NPF and it is not clear how these
objectives might fit with NPF except in the area of responsible/ethical investment.
- Treasury is working with the CFIs to develop an ethical investment framework – the
project is in the early stages and, whilst there is limited clarity of Government
RELEASED UNDER THE OFFICIAL INFORMATION ACT
expectations as to ethical investment, the initial focus will be on climate change and
how this ties in with other Government priorities (noting the terms ethical
investment and responsible investment are being used interchangeably). For NPF,
responsible investment is an area where Treasury considers there is potential for
alignment with Government objectives.
- The framework is expected to provide high level principles for consideration by CFIs
that reflect legislation and Government policy. It is expected the framework and
principles will be enduring and flexible enough to be accommodated within existing
mandates of CFIs. Consistency of outcomes across the CFIs is desirable.
2
- The expectation is for CFIs to take a leadership role in reporting under an ethical
investment framework in their annual reports, noting this will be an iterative process.
- A consultative process (involving a six-week cycle of workshops) is underway
between Treasury and the CFIs that started in late January 2021 to agree the
principles for the framework and to enable interim communication with the Minister
of Finance and the respective CFI boards.
- Independence of CFI decision making around investment strategy will be maintained,
unless a ministerial direction is given or a legislative change is made.
b)
The Chair noted:
- Clarification of the Minister of Finance’s views and expectations of CFIs, particularly
with respect to any specific targets and overall expected responses by the CFIs to
responsible investment will be helpful and will assist the Board in confirming to the
Minister of Finance any differences in approach between NPF and the other CFIs that
have specific legislative requirements.
- The ethical investment framework will need to be flexible to allow entities to
accommodate within their existing mandates.
- The Board appreciated the conversation with Treasury and noted the stability in the
Treasury team in recent years as a positive change that assisted with overall
communications.
s 9(2)(a)
and s 9(2)(a)
left the meeting at 10.20 am.
c)
Draft response to the Letter of Expectations
The Board:
-
DISCUSSED the draft response to the Minster in detail.
-
REQUESTED some changes to the letter.
-
CONFIRMED the final form of the letter would be agreed with the Chair for
submission by 26 February.
3.4 s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
s 9(2)(a) and (i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
3
3.5 Pension Cash Accumulation Scheme – Wind Up
The Board:
a)
NOTED the paper.
b)
AGREED the letter to be sent to the Minister of Finance seeking a direction to wind up
the Pension Cash Accumulation Scheme with some amendments.
c)
RESOLVED to wind up the Pension Cash Accumulation Scheme in terms of section 35 of
the trust deed effective 31 March 2021
SUBJECT TO receipt of a direction from the
Minister of Finance.
d)
APPROVED the transfer of Missing Persons to the Pension National Scheme in
preparation for the wind up of the Pension Cash Accumulation Scheme.
e)
APPROVED the transfer of all other members to the Pension National Scheme on wind
up of the Pension Cash Accumulation Scheme.
3.6 Responsible Investment Policy: ESG and CRO (Climate Related Risks and
Opportunities)
The Board:
a)
NOTED the portfolio developments on carbon exposure.
b)
NOTED s 9(2)(i)
c)
s 9(2)(i)
d)
s 9(2)(i)
e)
DISCUSSED the decision framework for managing climate related risks and opportunities
and provided feedback for incorporation into the draft statement on managing climate-
related risks and opportunities before it is posted on the website.
3.7 Review of s 9(2)(i)
: s 9(2)(i)
The Board:
RELEASED UNDER THE OFFICIAL INFORMATION ACT
a)
NOTED s 9(2)(i)
.
b)
NOTED s 9(2)(i)
3.8 JP Morgan – Amendment to Global Custody Agreement for Signing under
Common Seal
The Board:
a)
NOTED and
DISCUSSED the paper.
4
b)
APPROVED execution of the JP Morgan Amendment to the Global Custody Agreement
under common seal by two authorised signatories.
3.9
s 9(2)(i)
: Approval to sign under seal
The Board:
a)
NOTED the report.
b)
APPROVED the reduction in the management fee for s 9(2)(i)
c)
AUTHORISED the execution of the s 9(2)(i) letter under common seal by two authorised
signatories.
4. INVESTMENTS
4.1 Quarterly Investment Report
The Board:
a)
NOTED the report.
b)
DISCUSSED:
-
s 9(2)(i)
- Global equities and fixed interest unit funds are on target to meet expected outcomes.
-
s 9(2)(i)
– performance will be impacted by exposure to emerging market debt.
-
s 9(2)(i)
4.2 Investment Update
The Board:
a)
NOTED the report.
b)
DISCUSSED:
- the DAA equities/fixed income tilt has been unwound;
- going forward Management will be meeting quarterly with NZ Super and ACC to
discuss DAA.
- Cat Risk paper is due to come to the Board in Q3 on this subject.
4.3 Investment Road Map
RELEASED UNDER THE OFFICIAL INFORMATION ACT
The Board
NOTED the report.
5.
SCHEMES
5.1
Schemes Update
The Board
NOTED the report.
5
6.
FINANCE
6.1 Schemes - Financial Statements to 31 December 2020
The Board:
a)
NOTED the report incorporating the Schemes’ financial statements for the nine months
to 31 December 2020.
6.2 Board and Board Reserves Financial Statements to 31 December 2020
The Board:
a)
NOTED the financial statements of the Board of Trustees for the nine months ending
31 December 2020.
b)
NOTED the financial statements of the Board Reserves, for the nine months ending 31
December 2020.
7.
Papers for Noting
a)
Minutes of the ALCO Committee meeting held on 18 January 2021
The Board
NOTED the minutes of the ALCO meeting held on 18 January 2021.
b)
Minutes of the ALCO Committee meeting held on 16 February 2021
The Board
NOTED the minutes of the ALCO meeting held on 16 February 2021.
8.
Delegated Decisions
The Board
NOTED the report.
8.1 Use of Common Seal
The Board
NOTED the report.
8.2 Documents signed on behalf of the Board
The Board
NOTED the report.
8.3 Management decisions made under delegated authority
The Board
NOTED the report.
9.
OTHER BUSINESS
RELEASED UNDER THE OFFICIAL INFORMATION ACT
The Board:
a)
NOTED s 9(2)(a)
will be leaving shortly and
EXPRESSED their thanks to s 9(2)(a)
s 9(2)(a) for her service and wished her well for s 9(2)(a)
.
b)
REQUESTED Management circulate the job description to the Board for its information.
There being no other business, the meeting finished at 12.40 pm.
NEXT MEETING: The next meeting of the Board will be held in Wellington and is scheduled to
commence at
8.30am on Tuesday, 30 March 2021.
6
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Level 12, the Todd Building, 95 Customhouse Quay, Wellington,
and video conference via Zoom
Date
Tuesday, 30 March 2021 commencing at 8.30 am
PRESENT
Edward Schuck (Chair)
Stephen Ward
Sarah Park
Louise Edwards
Wayne Stechman
Daniel Mussett (via Zoom)
IN ATTENDANCE
Simon Tyler
Philippa Drury
Paul Bevin
s 9(2)(a)
s 9(2)(a)
of Devon Funds Management at
10.30 am
s 9(2)(a)
at 11.30 am
s 9(2)(a)
, Peter McCaffrey, Nicky Rumsey and s 9(2)(a)
for the investment items
Fiona Morgan for items 3.8 and 3.9
APOLOGIES
Nil
Th
e Board initially met in the absence of Management.
All
Board members confirmed there were no specific interests to declare.
1.
MINUTES OF THE BOARD MEETINGS
Th
e Board
NOTED and
AGREED the minutes of the Board meeting held on 25 February 2021
.
2.
ADMINISTRATION
2.1 Matters Arising
The Board:
RELEASED UNDER THE OFFICIAL INFORMATION ACT
a)
NOTED the Matters Arising.
b)
NOTED the strawman strategy document is with the Chair for review.
2.2 Long Term Work Plan
The Board
NOTED the Long-Term Work Plan is under development.
1
2.3 Interests Register
The Board:
a)
NOTED the Interests Register.
b)
NOTED Ed Schuck’s appointment as a director of Continuity Capital PE6 GP Limited
effective 19 March 2021.
3.
KEY PAPERS
3.1 Chief Executive’s Overview
The Board:
a)
NOTED the report.
b)
NOTED Datacom’s attendance has been deferred to later in the year.
3.2 Health, Safety and Wellness Update
The Board
NOTED and
DISCUSSED the Health and Safety Update and the dashboard.
3.3 Devon Presentation
The Chair welcomed s 9(2)(a)
and s 9(2)(a)
of Devon Funds Management to the
meeting.
The Board:
a)
RECEIVED a presentation from Devon.
b)
DISCUSSED a range of issues including governance, capacity, investment
philosophy/style and performance.
c)
THANKED s 9(2)(a)
and s 9(2)(a)
for their attendance at the meeting.
d)
REQUESTED Management include background information on managers (eg asset
class, value of portfolio under management, length of relationship, any concerns with
manager performance etc) as part of the covering paper in future.
e)
REQUESTED T Rowe Price and Brandywine be asked to present at future Board
meetings.
3.4 Investment Beliefs
RELEASED UNDER THE OFFICIAL INFORMATION ACT
The Board:
a)
NOTED the paper and agreed the Investment Beliefs should be simple, easy to read
statements.
b)
REQUESTED the inclusion of a belief on liability awareness when developing investment
strategy.
b)
REQUESTED Management to redraft the Investment Beliefs for Board approval.
3.5 DBP Annuitants Scheme – Asset Allocation Review
2
a)
NOTED the report and that this is the 3-yearly review of the DBPA notional strategic
asset allocation.
b)
DISCUSSED:
•
the asset allocation review assumes the Scheme is fully funded, when the liabilities
are discounted at the published Treasury rates;
•
some equities will be retained in the portfolio, to assist in meeting CPI.
c)
CONFIRMED there is no change to the current notional strategic asset allocation for
the DBPA, being:
DBPA - Current Notional Asset Allocation
Sector %
%
Cash
0
Fixed Interest
85
NZ Equities
5
Overseas Equities
10
c)
NOTED the notional asset allocation will be used to determine the factors in calculating
transfer values from the DBPC to the DBPA.
d)
NOTED the next review of the notional asset allocation will be undertaken in 2024 as
part of the next triennial asset allocation reviews.
3.6 National Provident Pension Scheme – Asset Allocation Review
The Board:
a)
NOTED the paper.
b)
DISCUSSED:
•
having some equity exposure is necessary if the Scheme is to have a chance of
granting pension increases in the future; and
•
the proposed change to the investment parameter.
b)
APPROVED a 10% reduction in the Scheme’s benchmark equity allocation to 30% from
40% effective 1 May 2021. This will result in the following SAA:
Current SAA
Recommended SAA
Risk
Risk
Unit
Target
Target
Benchmark
Benchmark
RELEASED UNDER THE OFFICIAL INFORMATION ACT
F Unit
60%
57.5%
70%
67.5%
E Unit
8%
7.5%
6%
5.5%
O Unit
32%
30%
24%
22%
A Unit
5%
5%
c)
NOTED Management will revisit the SAA for the Scheme as part of the triennial review
of the SAAs for all the schemes with s 9(2)(i) later this year.
d)
APPROVED the investment parameter is amended to following:
Investment Parameters
3
To maximise the expected returns on the Scheme’s assets, and hence the likelihood of
improving the actuarial solvency, subject to the constraint that there be no more than a
1 in 4 3 chance that the funding level will be less than 100% 80% after five years.
3.7 National Provident Pension Scheme - Pension Increase Policy
The Board:
a)
DISCUSSED the paper in detail.
b)
AGREED to retain the existing pension increase policy for the National Provident Pension
Scheme.
c)
REQUESTED s 9(2)(i)
.
d)
REQUESTED s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
3.8 Tax Advisory Services Contract
The Board:
a)
NOTED the paper.
b)
NOTED the proposed s 9(2)(i)
to apply from 1 April 2021.
c)
NOTED the change to the tax calculations only being reviewed quarterly by the tax
advisor, as opposed to monthly.
d)
s 9(2)(i) and (j)
e)
s 9(2)(i) and (j)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
f)
NOTED legal advice had been received from DLA Piper on the new contract.
g)
APPROVED the execution of the new contract with s 9(2)(i) and (j)
under
Common Seal by two authorised signatories.
3.9 NPF Expense Budget
The Board:
a)
NOTED the paper.
4
b)
REVIEWED AND DISCUSSED the budget for the year to 31 March 2022.
c)
APPROVED gross expenditure of s 9(2)(i)
3.10 NPF Schemes s 9(2)(i)
The Board:
a)
NOTED the paper and attached presentation.
b)
NOTED the s 9(2)(i)
c)
NOTED the available options for s 9(2)(i)
d)
AGREED to move to the next stage to develop a business case for the future s 9(2)(i)
, with Management to report back with an estimated budget for this work.
3.11 Policy Reviews
The Board:
a)
NOTED and
DISCUSSED the paper.
b)
APPROVED the NPF1 Taxation Policy.
c)
APPROVED the NPF7 Board Fees and Expenditure Policy.
3.12 Responsible Investment: Exclude Israeli Banks
The Board:
a)
NOTED the report.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
5
b)
APPROVED the following Israeli banks being added to the exclusion list:
First International Bank of Israel
FIBI Holdings
Israel Discount Bank
Bank Hapoalim
Bank Leumi
Bank Mizrahi-Tefahot
4. INVESTMENTS
4.1 Investment Update
The Board:
a)
NOTED the report.
b)
DISCUSSED:
- current DAA positions in place;
- performance.
c)
CONGRATULATED s 9(2)(a)
on passing the Level 3 CFA exams.
4.2 Ethical Investment Framework
The Board
NOTED and discussed the report.
4.3 Review of asset classes not currently invested in
The Board
NOTED and discussed the report.
4.4 Treasury Monitoring Report
The Board:
a)
NOTED and discussed the report.
b)
NOTED the final report will be provided to the Board for its information and in future.
5.
SCHEMES
5.1
Schemes Update
The Board
NOTED the report.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
5.2
DBP Contributors Scheme – Trust Deed Amendment
The Board:
a)
NOTED the verbal update from Management.
b)
APPROVED the deed of amendment to the Trust Deed allowing members to elect to
receive their retiring allowance without first ceasing service.
c)
APPROVED the execution of the deed of amendment to the Trust Deed under Common
Seal by two authorised signatories.
6
6.
FINANCE
6.1 Schemes - Financial Statements to 31 January 2021
The Board:
a)
NOTED the report incorporating the Schemes’ financial statements to 31 January 2021.
b)
NOTED Management will email the Board the after tax results for the year ended 31
March 2021 when they are available.
6.2 Board and Board Reserves Financial Statements to 31 January 2021
The Board:
a)
NOTED the financial statements of the Board of Trustees to 31 January 2021.
b)
NOTED the financial statements of the Board Reserves to 31 January 2021.
7.
Papers for Noting
The Board
NOTED the report.
8.
Delegated Decisions
The Board
NOTED the report.
8.1 Use of Common Seal
The Board
NOTED the report.
8.2 Documents signed on behalf of the Board
The Board
NOTED the report.
8.3 Management decisions made under delegated authority
The Board
NOTED the report.
9.
OTHER BUSINESS
There being no other business, the meeting finished at 12.56 pm.
NEXT MEETING: The next meeting of the Board will be held in Wellington and is schedul
RELEASED UNDER THE OFFICIAL INFORMATION ACT ed to
commence at
8.30am on Tuesday, 18 May 2021.
7
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Level 12, the Todd Building, 95 Customhouse Quay, Wellington,
and video conference via Zoom
Date
Tuesday, 18 May 2021 commencing at 8.30 am
PRESENT
Edward Schuck (Chair)
Stephen Ward
Louise Edwards
Wayne Stechman
Daniel Mussett
IN ATTENDANCE
Simon Tyler
Philippa Drury
Paul Bevin
s 9(2)(a)
from Brandywine 9.30 am
s 9(2)(a)
and Nicky Rumsey for the investment items
Fiona Morgan for item 6
APOLOGIES
Sarah Park
Th
e Board initially met in the absence of Management.
All
Board members confirmed there were no specific interests to declare.
1.
MINUTES OF THE BOARD MEETINGS
Th
e Board
NOTED and
AGREED the minutes of the Board meeting held on 30 March 2021
.
2.
ADMINISTRATION
2.1 Matters Arising
The Board:
a)
NOTED and discussed the Matters Arising.
b)
NOTED the Chair’s comment the strawman strategy document will be included with the
papers for the next Board meeting.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
2.2 Long Term Work Plan
The Board
NOTED the Long-Term Work Plan.
1
2.3 Interests Register
The Board
NOTED the Interests Register.
3.
KEY PAPERS
3.1 Chief Executive’s Overview
The Board
NOTED and discussed the report.
3.2 Health, Safety and Wellness Update
The Board
NOTED and
DISCUSSED the Health and Safety Update and the dashboard.
3.3 Responsible Investment Update
The Board:
a)
NOTED the report.
b)
NOTED NPF’s carbon intensity in s 9(2)(i)
of market but
this will reduce following changes to s 9(2)(i) mandate to cap it at s 9(2)(i)
c)
NOTED developments with CFIs and the Government regarding the proposed ethical
investment framework.
3.4 Capital Market Assumptions
The Board:
a)
NOTED and discussed
the Annuitas capital markets assumptions at 31 March 2021.
b)
NOTED Management will provide the Board with a comparison of 31 March 2021 Russell
assumptions with 31 March 2021 Annuitas assumptions for the next Board meeting.
c)
NOTED the Annuitas capital market assumptions have been shared with the Actuary.
3.5 Global Fixed Income Review
The Board:
a)
NOTED the report and that the existing managers have had excellent out performance
in the last year following a setback in Q1 2020.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
b)
NOTED both s 9(2)(i)
have sound ESG policies and are active in this
space.
c)
DISCUSSED:
- Currency positions taken by managers.
- The different styles of PIMCO and Brandywine.
- The number of fixed interest managers for the portfolio and the funding allocated to
each of them.
- Hedging to the NZD.
2
- Duration.
- Tracking error.
- Attribution of emissions to equities and bonds.
d)
REQUESTED Management review the
management structure of the fixed income
portfolio, in particular:
- The rationale for a core and satellite approach.
- The guidelines for Brandywine.
- The portfolio weighting to Brandywine, having regard to each manager's
contribution to overall active risk.
- Whether two is the appropriate number of managers for the F Fund.
3.6
Brandywine
The Chair welcomed s 9(2)(a)
from Brandywine to the meeting via Zoom.
The Board:
a)
RECEIVED a presentation from s 9(2)(a)
covering a range of issues including:
-
Brandywine’s approach to portfolio management, benchmark agnostic.
-
Strategy – global opportunistic fixed income.
-
Risk – defined as a loss of capital.
-
Invest in global sovereign bonds with active foreign currency exposure and an
-
opportunistic allocation to credit,, ESG approach – integrated, not ESG led.
-
Return sources – country, currency, credit and residual exposure.
-
Performance expectations, noting the portfolio will do well if the Federal
Reserve doesn’t tighten rates thus allowing emerging market currencies to do
well.
-
Carbon exposure for corporate bonds in the portfolio.
b)
THANKED s 9(2)(a)
for his attendance at the meeting.
3.7 Chair letter to Members
The Board
DISCUSSED the draft letter and requested some amendments, in particular
s 9(2)(i)
4. INVESTMENTS
4.1 Quarterly Investment Report
The Board:
RELEASED UNDER THE OFFICIAL INFORMATION ACT
a)
NOTED the report.
b)
DISCUSSED:
- Benchmark reporting – actual, target and reference portfolios.
- DAA reporting will be added to the quarterly investment report.
c)
REQUESTED Management provide an explanation in the quarterly investment report of
the Investment Objective for each scheme.
3
4.2 Investment Update
The Board:
a)
NOTED the report.
b)
NOTED Fund performance is s 9(2)(i)
c)
DISCUSSED in general overseas travel requirements for investment purposes, including
the requirement to carry out due diligence on new managers, and likely changes to the
way of engaging internationally going forward.
5.
SCHEMES
5.1
Schemes Update
The Board
NOTED and discussed the report.
6.
FINANCE
6.1 NPF Annual Financial Statements
The Board:
a)
NOTED the report
b)
NOTED the retirement of s 9(2)(a)
from PwC and his replacement by s 9(2)(a)
6.2 Year End Results - Board and Board Reserves to 31 March 2021
The Board:
a)
NOTED the financial information for the Board of Trustees to 31 March 2021.
b)
NOTED the financial information for the Board Reserves to 31 March 2021.
7.
Papers for Noting
The Board
NOTED the minutes of the ALCO Committee meetings held on 22 March 2021 and
21 April 2021.
8.
DELEGATED DECISIONS
8.1 Use of Common Seal
RELEASED UNDER THE OFFICIAL INFORMATION ACT
The Board
NOTED the report.
8.2 Documents signed on behalf of the Board
The Board
NOTED the report.
4
8.3 Management decisions made under delegated authority
The Board
NOTED the report.
9.
OTHER BUSINESS
There being no other business, the meeting finished at 12.15 pm.
NEXT MEETING: The next scheduled meeting of the Board will be held in Wellington
commencing at
1.00pm on Thursday, 24 June 2021.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
5
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
By circulation
Date
Monday, 24 May 2021
PRESENT
Edward Schuck (Chair)
Stephen Ward
Louise Edwards
Wayne Stechman
Daniel Mussett
APOLOGIES
Sarah Park
N
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efiE
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erIO
so N
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a A
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h PE
emesR
SONAL SCHEMES
The Board:
Purpose of this paper
1.
RECEIVED a paper by circulation from Management with the Actuary’s recommendations,
Each yea
wi r
t ,
h p
r r
eio
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:
Accumulation and Lump Sum
Cash Accumulation Schemes (the
Personal Schemes) in relation to:
•
Earnings Rates for the Defined Contribution and Personal Schemes.
•
•
E
arning
Tr
s
a
Ra
nsf
t
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r
s
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g e
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d Personal Schemes.
•
•
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ransfe
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i
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ari
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on e
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•
•
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eserv
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d
m
is
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r
u
at
t
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on
n c,
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s
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o ,
r ftro
a m
n
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ere
f P
o e
r n
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ef a
i s
n h
e
d A
c
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triu
b la
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n S
a c
n h
d e
Pm
e e
n
s o
i n
o l
n y
.
S chemes.
•
Administration costs for transfer for the Defined Contribution and Pension Schemes.
together with a copy of a letter from the Actuary dated 21 May 2021 setting out her
The pap
r e
e r
c
ois
m di
m v
e id
n e
d d
a
tiin
o t
no
s .t hree sections, Defined Contribution Schemes, Personal Schemes and both,
with recommendations in each section for each scheme.
2.
The Board,
RESOLVED, based on the advice of the Actuary, to :
Attached as
Appendix 1 is the Actuary’s letter, dated 21 May 2021, setting out her
recom
Pensi m
one
n
Nd
aat
ti ion
on s
a .
l Scheme
(
1.
i)
DE
DE FIN
CLA ED
RE
,
CO
in
N
ac
TRI
cor
BU
dan
T
c
I
e
ON
wit
h
SCH
cl
E
aus
M
e
ES
16
.1 of the Pension National Scheme trust deed, an
Earnings Rate of
16.11% per annum be applied to each Contributor's Total Credit as at
The matte
1 Apr
ril
s for
202
co
0.
nsideration by the Board with respect to the Defined Contribution Schemes are
as follows:
(
ii)
DETERMINE, in accordance with clause 16.2 of the Pension National Scheme trust deed,
•
th
E
e
arnin
basi
g
s
s
f
o
R
r
at
al
e
l
s
o
cating earnings on contributions paid to the Pension National Scheme
•
du
T
r
r
i
a
n
n
g
sfe
th
r
e
Va
pe
lr
u
i
e
o
d
Ea
1
rnin
Apr
g
il
s Ra
202
tes
0 t
o 31 March 2021 shall be at the rate of
6.44%.
•
Basis for allocating earnings on contributions received during the year
(iii) DETERMINE, for the purposes of clauses 31B.3 and 31B.4 of the Pension National
RELEASED UNDER THE OFFICIAL INFORMATION ACT
Commen
Sch
t
e
on
me
each
tru
o
st d
f
e
t
e
h
d
es
, t
e
h
mat
e Tr
te
an
rs
sf
is
er
pro
Val
vid
ue
e
E
d
ar
b
n
e
i
l
n
o
g
w
s
.
Rate (to apply from the effect date of
transfer to the date of payment of the transfer value) for the Pension National Scheme
Earnin
fr
gs
o
Ra
m 24
tes
Ma
a
y
nd
20
T
21
ran
unt
sfe
il
r V
furth
a
e
lr
ue E
noti
a
c
r
e
ni
ng
shall
s R
be
ate
at
s
the rate of
4.00% per annum.
The Actuary’s recommendations with respect to the Earnings Rates and Transfer Value Earnings
Rates
Lump are s
Sum e
t
N o
a u
ti t be
onalo
w.
S
cheme
(
Ba
i)
sis fo
DE r a
CLAlloc
RE a
, i
ti
n
ng
acc
e
o
a
r
r
d
ni
an
n
c
gs
e
with clause 14.1 of the Lump Sum National Scheme trust deed,
The b
t
a
h
sis
at
fo
an
r
E
al
ar
lo
ni
cati
ng
n
s
g
R
at
ear
o
n
f
ings on c
15.46% o
p
n
e
tr
ribu
an
t
n
io
u
ns
m b
re
e
ceive
appli
d
e
d
du
to
rin
e
g
a
the
ch Co
ye
ntr
a
i
r
b
u
it
s
o
ap
r's
pro
Tot
ve
al
d
C
r
b
e
y
d
i
t
t
h
e
Board an
as
n
at
ually
1 Apr
as
il
thi
202
s i
0.
s
sue is only dealt with in general terms by the trust deeds for the schemes.
For example, clause 16.2 of the trust deed for the Pension National Scheme states:
“As soon as practical after the end of each Financial Year the Board shall determine the basis of
allocating earnings to contributions paid into this Scheme during that Financial Year.”
1
Historically, Board policy has been to set the basis for allocating earnings on contributions made
during the financial year at 40% of the Earnings Rates declared for the year (e.g. Pension National
Scheme and Lump Sum National Scheme - 40% of 4.00% = 1.60%). The Meat Industry Scheme
is different – clause 16.3 of the trust deed specifies the rate to be one half of the rate declared by
the Board (50% of 4.00% = 2.00%).
(ii)
DETERMINE, in accordance with clause 14.2 of the Lump Sum National Scheme trust
deed, the basis for allocating earnings to contributions paid to the Lump Sum National
Scheme during the period 1 April 2020 to 31 March 2021 shall be at the rate of
6.18%.
(iii)
DETERMINE, for the purposes of clauses 22B.3 and 22B.4 of the Lump Sum National
Scheme trust deed, the Transfer Value Earnings Rate (to apply from the effect date of
transfer to the date of payment of the transfer value) for the Lump Sum National Scheme
from 24 May 2021 until further notice shall be at the rate of
4.00% per annum.
Meat Industry Scheme
(i)
DECLARE, in accordance with clause 16.1 of the Meat Industry Scheme trust deed, that
an Earnings Rate of
14.41% per annum be applied to each Contributor's Total Credit as
at 1 April 2020.
(ii)
DETERMINE, in accordance with clause 16.3 of the Meat Industry Scheme trust deed,
the basis for allocating earnings to contributions paid to the Scheme, during the period 1
April 2020 to 31 March 2021 shall be at the rate of
7.21%.
(iii)
DETERMINE, for the purposes of clauses 27B.3 and 27B.4 of the Meat Industry Scheme
trust deed, the Transfer Value Earnings Rate (to apply from the effect date of transfer to
the date of payment of the transfer value) for the Meat Industry Scheme from 24 May
2021 until further notice shall be at the rate of
4.00% per annum.
2.
PERSONAL SCHEMES
The Board, based on the advice of the Actuary,
RESOLVE TO:
Lump Sum Cash Accumulation Scheme
(ii)
DECLARE, in accordance with Clause 11.1 of the Scheme trust deed, an Earnings Rate of
4.00% per annum to apply from 24 May 2021 until further notice.
(iii)
DETERMINE, for the purposes of clauses 19B.3 and 19B.4 of the Lump Sum Cash
Accumulation Scheme trust deed, the Transfer Value Earnings Rate (to apply from the
effective date of transfer to the date of payment of the transfer value) for the Lump Sum
Cash Accumulation Scheme from 24 May 2021 until further notice shall be at the rate of
4.00% per annum.
Pension Cash Accumulation Scheme
(iv)
DECLARE, in accordance with Clause 11.1 of the Scheme trust deed, an Earnings Rate of
4.00% per annum to apply from 24 May 2021 until further notice.
(v)
DETERMINE, for the purposes of clauses 23B.3 and 23B.4 of the Pension Cash
Accumulation Scheme trust deed, the Transfer Value Earnings Rate (to apply from the
effective date of transfer to the date of payment of the transfer value) for the Pension Cash
RELEASED UNDER THE OFFICIAL INFORMATION ACT
Accumulation Scheme from 24 May 2021 until further notice shall be at the rate of
4.00% per annum.
(vi)
DETERMINE, based on the advice of the Actuary, that in terms of clause 13.4.1 of the
Pension Cash Accumulation Scheme trust deed, there is an additional distribution to
contributors from the Reserve Account for the year ended 31 March 2021 of 4.61%.
2
3.
DEFINED CONTRIBUTION SCHEMES AND PERSONAL SCHEMES
The Board, based on the advice of the Actuary
APPROVED individual transfer values for all
Defined Contribution and Personal Schemes being reduced by an amount equal to the
administration cost of transfer, in cases where the solvency margin is less than or equal to 0%,
or greater than or equal to 10%.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
3
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Level 12, the Todd Building, 95 Customhouse Quay, Wellington,
and Zoom video conference
Date
Thursday, 24 June 2021 commencing at 1.00 pm
PRESENT
Edward Schuck (Chair)*
Stephen Ward*
Louise Edwards*
Wayne Stechman
Daniel Mussett
Sarah Park*
IN ATTENDANCE
Simon Tyler
Philippa Drury
Paul Bevin*
s 9(2)(a)
Fiona Morgan (up to item 3.14 but excluding 3.3)
s 9(2)(a)
s 9(2)(a)
and s 9(2)(a)
from
PricewaterhouseCoopers and s 9(2)(a)
for Agenda Item 3.3
APOLOGIES
There were no apologies
* Denotes participants joined the meeting via Zoom.
Th
e Board initially met in the absence of Management.
s 9(2)(a)
All
Board members confirmed there were no specific interests to declare.
1.
MINUTES OF THE BOARD MEETINGS
The Board:
a)
NOTED and
AGREED the minutes of the Board meeting held on 18 May 2021
.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
b)
NOTED the February and March 2021 Board minutes have been updated for the minor
amendments requested by the Board and the reference to minor amendments removed
from the minutes for the March and May 2021 meetings.
c)
AGREED the minutes of the Board meeting held on 24 May 2021.
2.
ADMINISTRATION
2.1 Matters Arising
1
The Board:
a)
NOTED and
DISCUSSED the Matters Arising.
b)
NOTED the strawman strategy document is with the Chair for action as appropriate.
2.2 Long Term Work Plan
The Board:
a)
NOTED the Long-Term Work Plan.
b)
AGREED the Investment Committee self-review be deferred to December 2021, prior to
the final Board meeting for the year.
c)
DISCUSSED Board education, noting the process is for requests from Board members to
be sent to Simon Tyler or the Chair, for approval by the Chair. Education requests by the
Chair are considered by the Chair of the Audit and Risk Review Committee.
d)
NOTED the draft annual reports to members will be circulated to the Board for review
and comment as soon as they are available.
2.3 Interests Register
The Board
NOTED the Interests Register.
3.
KEY PAPERS
3.1 Chief Executive’s Overview
The Board:
a)
NOTED the report.
b)
NOTED the Chair and Simon Tyler will put forward to the Board proposed dates in early
August 2021 for a zoom meeting between the Board and Treasury to discuss the CFI
responsible investment framework.
c)
NOTED the update on cyber risk provided by s 9(2)(a)
and that cyber risk awareness
is regularly considered by Management and reminders given to staff of any potential new
risks or issues.
d)
DISCUSSED the s 9(2)(b)(ii) surveys and that a more tailored survey would be more
appropriate where responses are sought from Board members.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
e)
NOTED any proposed actions and timelines for the investment team in response to the
Willis Towers Watson Statutory Review of GSF that relate to NPF will be incorporated into
the work plan.
f)
AGREED there will be an ARRC meeting on the morning of 24 August 2021, followed by
a Board meeting in the afternoon and a Board dinner in the evening of that same day.
g)
AGREED to add a placeholder for a meeting on 6 December 2021, via zoom, with a 10.00
am start time.
h)
DISCUSSED the proposed Board meeting dates for 2022 and agreed the dates subject
to two changes:
2
• 23 February 2022 (starting at 11.00 am)
• 23 August 2022 (starting at 11.00 am)
i)
DISCUSSED and
AGREED the Chair will raise with the Chair of GSFA the purpose of the
combined dinner currently on the workplan.
3.2 Health, Safety and Wellness Update
The Board
NOTED and
DISCUSSED the Health and Safety Update and the dashboard.
3.3 National Provident Pension Scheme – s 9(2)(i)
The Board welcomed s 9(2)(a)
and s 9(2)(a)
from PricewaterhouseCoopers and
s 9(2)(a)
from
s 9(2)(i) and (j)
to the meeting for discussion of this item.
The Board:
a)
NOTED and robustly
DISCUSSED the paper including:
• the background to membership of the Scheme, the terms of the trust deed; and the
pension increase policy;
• the financial management plan for the Scheme being progressed with
s 9(2)(i) and (j) with a view to establishing clear objectives for the future management of
the Scheme that flow through to the investment strategy and the pension pricing and
increase practices and policies;
• the estimated funding level at 31 March 2021 of s 9(2)(j) , calculated on a funding basis,
and s 9(2)(j), calculated on a minimum risk basis, and the verbal advice from Management
that the estimated funding level at s 9(2)(j)
• the expected future return on the assets of the Scheme, noting it is likely the Scheme
will always need to hold some equity investments; and
• the interests of the stakeholders, ie members and the Crown.
b)
REVIEWED the advice from the Actuary and discussed the paper and that advice with
the Actuary and with s 9(2)(a)
c)
s 9(2)(i)
d)
s 9(2)(i)
s 9(2)(a)
left the meeting.
3.4 Draft Minutes of the Audit and Risk Review Committee meeting held on 8 June
2021
RELEASED UNDER THE OFFICIAL INFORMATION ACT
The Board:
a)
DISCUSSED the draft minutes of the Audit and Risk Review Committee meeting held
on 8 June 2021.
b)
NOTED Stephen Ward’s confirmation there were no matters he wished to bring to the
attention of the Board.
c)
NOTED Deloitte had been invited to attend the Board meeting and had confirmed in
their view there was no need.
3
3.5
Financial Statement Review Process
The Board:
a)
NOTED the report on the financial statement review process.
b)
NOTED that, given the Pension Cash Accumulation Scheme is being wound up effective
31 March 2021, the scheme is not a going concern and therefore the notes to the financial
statements are different from last year.
3.6
Auditor Report
The Board:
a)
RECEIVED and discussed the report.
b)
AGREED Management’s responses to the internal control findings were appropriate.
3.7 Representations
The Board:
a)
NOTED the representations from Management.
b)
REVIEWED and
DISCUSSED the questionnaire and completed the responses to section
14.
c)
AUTHORISED Edward Schuck and Stephen Ward to sign the questionnaire (by way of
electronic signature) on behalf of the Board.
d)
REVIEWED and
APPROVED the wording of the representation letters to the Auditor.
e)
AUTHORISED Edward Schuck and Stephen Ward to sign (via electronic signature) the
representation letters to the Auditor.
f)
AGREED there are no subsequent events for inclusion in the financial statements of any
of the entities and authorised Fiona Morgan to confirm this to the Auditor.
3.8 Financial Statements 2021 – Board of Trustees of the National Provident Fund
The Board:
a)
NOTED the financial statements of the Board of Trustees of the National Provident Fund
for the year ended 31 March 2021.
b)
RESOLVED to:
RELEASED UNDER THE OFFICIAL INFORMATION ACT
i)
APPROVE and
ADOPT the Board of Trustees of the National Provident Fund
financial statements for the year ended 31 March 2021.
ii)
AUTHORISE Edward Schuck and Stephen Ward to sign (via electronic signature),
on behalf of the Board, the Board of Trustees of the National Provident Fund
financial statements for the year ended 31 March 2021.
4
3.9 Financial Statements 2021 – Global Asset Trust
The Board:
a)
NOTED the financial statements of the Global Asset Trust for the year ended 31 March
2021 and the review undertaken by the Audit and Risk Review Committee.
b)
RESOLVED to:
i)
APPROVE and
ADOPT the Global Asset Trust financial statements for the year
ended 31 March 2021.
ii)
AUTHORISE Edward Schuck and Stephen Ward to sign (via electronic signature),
on behalf of the Board, the Global Asset Trust financial statements for the year
ended 31 March 2021.
3.10 Financial Statements 2021 – NPF Schemes
The Board:
a)
NOTED the review undertaken by, and subsequent recommendation of, the Audit and
Risk Review Committee with respect to the financial statements for the nine NPF
Schemes for the year ended 31 March 2021.
b)
RESOLVED to:
i)
APPROVE and
ADOPT the financial statements for the year ended 31 March 2021
for the nine NPF Schemes.
ii)
AUTHORISE Edward Schuck and Stephen Ward to sign (via electronic signature),
on behalf of the Board, the financial statements for the year ended 31 March 2021
for the nine NPF Schemes.
3.11 Section 67 (1A) Report at 31 March 2021
The Board:
a)
NOTED the report.
b)
REQUESTED a note be added to section A1 explaining why the actual asset allocation
differs from the benchmarks as at 31 March 2021.
3.12 Schemes – Section 72
The Board:
a)
NOTED and
DISCUSSED the report.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
b)
RESOLVED in terms of section 72 of the National Provident Fund Restructuring Act 1990
to make a claim on the Minister of Finance for the deficit arising from the application of
the 4% minimum earnings rate to the Lump Sum National Scheme in the year to 31
March 2021 of $1,619.88.
c)
APPROVED the form of the letter to the Minister of Finance.
d)
AUTHORISED Management to progress the claim with the Minister of Finance and
Treasury.
5
3.13 Basis for Determining the Transfer of Assets between the DBP Contributors
Scheme and the DBP Annuitants Scheme
The Board:
a)
NOTED the Actuary’s report on the basis for determining the transfer of assets between
the DBP Contributors Scheme and the DBP Annuitants Scheme.
b)
Based on the recommendations of the Actuary
RESOLVED to:
i)
ADOPT the 2021/2022 transfer basis, set out in the Actuary’s report dated 11 June
2021, and the transfer factors, calculated using the transfer basis as set out in
Appendix A of the report, with effect from 1 July 2021, for the purposes of clause
F9 of the trust deed of the DBP Contributors Scheme and clause 8 of the trust deed
of the DBP Annuitants Scheme.
ii)
Continue to
REVIEW the transfer basis annually.
3.14 Minimum Risk Rates 31 March 2021
The Board:
a)
NOTED the minimum risk rates for the NPF defined benefit schemes as at 31 March
2021.
b)
NOTED the Annuitas minimum risk rates will be used for the NPF defined benefit
schemes for Board reporting, disclosure in the financial statements and for determining
whether the investment strategy is adding value compared to the additional risk being
taken.
c)
NOTED going forward the weighted average term would be based on discounted cash
flows provided by the Actuary.
3.15 s 9(2)(i)
The Board:
a)
s 9(2)(i)
b)
s 9(2)(i)
c)
s 9(2)(i)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
d)
s 9(2)(i)
e)
s 9(2)(i)
6
3.16 Responsible Investment Update
The Board:
a)
NOTED and
DISCUSSED progress on the CFI ethical investment framework.
b)
DISCUSSED potential ways of reducing portfolio carbon exposure by 50% by 2025.
c)
NOTED Management’s expectation the NPF portfolio will be underweight carbon by
the end of June 2021, compared to the MSCI ACWI global equity index weightings.
d)
AGREED to defer further consideration of this matter until later in the year, once
discussions have been had with Treasury.
3.17 Climate Change TCFD Report
The Board:
a)
NOTED the draft paper and that it is expected NPF will be required to provide Task Force
on Climate-related Financial Disclosures (
TCFD) reporting for the year ended 31 March
2022.
b)
REQUESTED Management review the draft document with a view to making it readable
by most audiences and bring the revised version back to the Board for consideration.
c)
REQUESTED reference to TCFD reporting be included in the Chair’s letter to members
this year.
4. INVESTMENTS
4.1 Quarterly Investment Report
The Board:
a)
NOTED the report.
b)
DISCUSSED:
• Returns are up so far for s 9(2)(i)
and year to date s 9(2)(i)
•
s 9(2)(i)
4.2 Fixed Interest –
s 9(2)(i)
The Board:
a)
NOTED the report.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
b)
NOTED no changes are recommended to s 9(2)(i)
– the guidelines were
tightened in 2019.
c)
NOTED s 9(2)(i)
.
d)
NOTED the tracking error of s 9(2)(i)
7
e)
NOTED s 9(2)(i)
contributes around s 9(2)(i)
f)
NOTED the size of s 9(2)(i)
portfolio currently represents s 9(2)(i)
g)
DISCUSSED:
• the size of the allocation to s 9(2)(i) concentration risk and contribution to risk from
s 9(2)(i)
;
• benchmark-relative (ie active) risk versus total volatility risk, noting
s 9(2)(i)
• Management’s view that the s 9(2)(i)
is appropriate and s 9(2)(i)
h)
APPROVED changing the weights at the next ALCO (end July 2021) from s 9(2)(i)
respectively.
i)
NOTED Management will review s 9(2)(i)
and report to the
Board on of the case for s 9(2)(i)
.
5.
SCHEMES
5.1 Schemes Update
The Board
RECEIVED a verbal update from Management confirming there are no issues of
note to be brought to the attention of the Board not covered elsewhere in the papers for this
meeting.
6.
FINANCE
6.1 NPF Schemes (GAT) Results to 31 May 2021
The Board
NOTED the report
6.2 Board and Board Reserves – Financial Statements to 30 April 2021
The Board:
a)
NOTED the financial information for the Board of Trustees to 30 April 2021.
b)
NOTED the financial information for the Board Reserves to 30 April 2021.
7.
PAPERS FOR NOTING
RELEASED UNDER THE OFFICIAL INFORMATION ACT
The Board
NOTED the minutes of the ALCO Committee meeting held on 18 May 2021.
8.
DELEGATED DECISIONS
8.1 Use of Common Seal
The Board
NOTED Management’s advice the report had not been updated and that an updated
report would be provided to the next meeting. Management confirmed the earlier approved
trust deed amendments for the NPF Schemes had been executed under common seal on 6 May
2021.
8
8.2 Documents signed on behalf of the Board
The Board
NOTED the report.
8.3 Management decisions made under delegated authority
The Board
NOTED the report.
9.
OTHER BUSINESS
The Chair noted Wayne Stechman retires from the Board after nine years of service on 30 June
2021. The contribution he has made to the governance of NPF over the years is substantial.
Wayne will be missed and my fellow Board members and the Board wished him well in his
future endeavours.
There being no other business, the meeting finished at 4.30 pm.
NEXT MEETING: The next scheduled meeting of the Board will be held in Wellington
commencing at
1.00 pm on Tuesday, 24 August 2021.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
9
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Level 12, the Todd Building, 95 Customhouse Quay, Wellington and
via Zoom
Date
Monday 5 July 2021 commencing at 2.00 pm
PRESENT
Edward Schuck (Chair) *
Stephen Ward
Louise Edwards *
Daniel Mussett *
Sarah Park *
IN ATTENDANCE
Simon Tyler
Paul Bevin
s 9(2)(a)
s 9(2)(a)
Philippa Drury
APOLOGIES
There were no apologies
* Denotes participants joined the meeting via Zoom.
N
ational Provident Pension Scheme – pension increase consideration
T
he Board:
1.
RECEIVED a paper headed National Provident Pension Scheme (the
Scheme) –
s 9(2)(i)
2.
DISCUSSED the paper in detail, including:
• The Board’s earlier request for a total financial management framework to be
developed as soon as possible for the Scheme.
• The desire of all Board members to gain a better understanding of the overall
Scheme and the future projections for the Scheme before approving any increase
in the liabilities.
• The Crown guarantee and the availability of any past legal opinions on the way in
which the Crown guarantee is intended to work.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
• The pension purchase factors for the Scheme, noting they are also to be reviewed
as part of the total financial management framework being developed for the
Scheme.
•
s 9(2)(a)
s 9(2)(b)(i)
3.
s 9(2)(i)
1
4.
RESOLVED not to increase the pensions in payment under the Scheme at this time.
5.
REQUESTED Management expedite the development of a total financial management
framework for the Scheme, incorporating a review of the investment strategy, the
pension increase policy and the pension factors, in conjunction with external advisers
with the aim of completing a draft version of the framework by 30 September 2021.
6.
REQUESTED the following be circulated to the Board as a package as soon as
available:
a)
A cover paper.
b)
Any previous legal opinions received in relation to the to the Crown guarantee.
c)
s 9(2)(g)(i)
d)
Communications since 2000 sent to members regarding the pension increase
policy for the Scheme.
e)
Any information or legal advice received on the Trustee Act, particularly with
regard to equity.
f)
s 9(2)(h)
g)
The March 2021 paper to the Board on the Scheme.
h)
s 9(2)(g)(i)
7.
AGREED to review whether pensions in payment should be increased after the Board
has received the information contemplated by items (5) and (6) above, plus any other
information or advice the Board considers appropriate, by 31 March 2022.
The meeting closed at 3.20 pm.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
2
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Zoom video conference
Date
Thursday, 24 August 2021 commencing at 12.00 midday
PRESENT
Edward
Schuck
(Chair)*
Stephen Ward*
Daniel Mussett*
Sarah
Park*
Graham Ansell* (from 12 midday to 1.55pm)
IN ATTENDANCE
Simon Tyler*
Philippa Drury*
Paul Bevin*
s 9(2)(a)
Nicky Rumsey*
Peter McCaffrey*
s 9(2)(a)
APOLOGIES
Louise Edwards
* Denotes participants joined the meeting via Zoom.
The Board initially met in the absence of Management.
All Board members confirmed there were no specific interests to declare.
1.
MINUTES OF THE BOARD MEETINGS
The Board:
a)
NOTED and
AGREED the minutes of the Board meetings held on 24 June 2021 and 5
July 2021 subject to an amendment to the wording of the 24 June 2021 minutes to item
3.3(d) to read:
s 9(2)(i)
b)
NOTED the dates for the NPF Board meetings for the year have been shared with the
RELEASED UNDER THE OFFICIAL INFORMATION ACT
GSFA Board and
AGREED no further action is required at this stage with respect to a
combined dinner with the GSFA Board.
2. ADMINISTRATION
2.1 Matters Arising
The Board:
a)
NOTED and
DISCUSSED the Matters Arising.
1
b)
AGREED a package of information for the Board on the Crown guarantee will be
accumulated and made available to the Board for consideration in advance of any meeting
to provide sufficient reading time for Board members.
c)
AGREED to discuss the Crown guarantee separately to the financial management
framework for the National Provident Pension Scheme.
2.2 Long Term Work Plan
The Board:
a)
NOTED the Long-Term Work Plan.
b)
NOTED the Investment Committee review and the paper on s 9(2)(i)
have
been rescheduled to the October/December quarter.
2.3 Interests
Register
The Board
NOTED the Interests Register.
3. KEY
PAPERS
3.1 Chief Executive’s Overview
The Board:
a)
NOTED the report.
b)
DISCUSSED Annuitas responsible investment (
RI) resources, noting the GSFA Board as
a Crown Financial Institution has budgeted for and is looking to increase its RI resources.
3.2 Health, Safety and Wellness Update
The Board:
a)
NOTED and
DISCUSSED the Health and Safety Update and the dashboard.
b)
REQUESTED s 9(2)(a)
review the content and frequency of the Health and Safety
information provided to the Annuitas Board and confirm the reporting this Board.
3.3 Review of Investment Model s 9(2)(j)
The Board:
a)
NOTED the paper and the observations in s 9(2)(i)
letter.
b)
DISCUSSED the paper including:
RELEASED UNDER THE OFFICIAL INFORMATION ACT
• The Board should consider s 9(2)(i)
and weigh
up the cost benefit on a regular basis.
• The need to review and confirm the model remains appropriate.
c)
AGREED there are no inadequacies needing to be addressed or specific improvements to
the model at this time.
d)
APPROVED the NPF investment model.
2
3.4 Investment Beliefs Redraft
The Board deferred this paper for consideration by the whole Board, after it has been reviewed
by the Investment Committee.
3.5
GSFA Reviews: Implications for NPF
The Board:
a)
NOTED the paper.
b)
NOTED the update on the implications for NPF of the recent statutory review of the GSFA
and Management’s responses and that these will be expanded to include the
recommendations of the Burgess review for the next Board meeting.
c)
NOTED the changes to the GSFA SIPSP were primarily style related, less on substance
or content.
d)
NOTED Management will prioritise the proposed actions for NPF arising from the reviews.
3.6 s 9(2)(i)
- Managers
The Board:
a)
NOTED and discussed the report including that funding would be in stages
s 9(2)(i)
b)
APPROVED the appointment of s 9(2)(i) subject to satisfactory legal sign-off.
c)
APPROVED
s 9(2)(i)
.
d)
AUTHORISED the execution of the Investment Management Agreement under
common seal by two authorised signatories.
e)
NOTED s 9(2)(i)
:
s 9(2)(i)
5
5
f)
NOTED Management would expect to increase s 9(2)(i)
once all
is running smoothly from an operational side and our confidence remains high.
Management will revert to the Board at that time.
g)
NOTED Management will revert to the Board with the recommended investment
RELEASED UNDER THE OFFICIAL INFORMATION ACT
guidelines.
h)
NOTED contract negotiations have not yet begun and these normally take a few
months.
i)
NOTED Management does not recommend commissioning an independent operations
due diligence report as assets will be held at the Board’s custodian and Management
has visited s 9(2)(i) offices.
3
3.7
s 9(2)(i)
Guidelines
The Board:
a)
NOTED the paper.
b)
QUERIED whether any other guidelines needed updating and received confirmation
from Management they did not.
b)
NOTED the revised s 9(2)(i) First Schedule, Investment Mandate.
c)
AUTHORISED execution of the new First Schedule under common seal by two
authorised signatories.
3.8 DBPA – Asset Allocation Recommendation
The Board:
a)
NOTED the paper.
b)
APPROVED the DBPA assets be s 9(2)(i)
c)
DELEGATED to Management the timing of this reallocation.
d)
NOTED the reallocation will result in s 9(2)(i)
e)
APPROVED the termination of s 9(2)(i)
f)
NOTED the SIPSP will be updated to reflect these changes.
g)
NOTED the s 9(2)(i) will remain available and can be reactivated within a short period of
time should the Board require it at a future date.
3.9 NPF Schemes – Triennial Actuarial Examinations
The Board:
a)
NOTED the triennial actuarial examinations of the DBP Contributors Scheme, DBP
Annuitants Scheme, Aircrew Scheme and National Provident Pension Scheme at 31 March
2021.
b)
NOTED Management’s confirmation of the legislation requirement that the reports must
be sent to the Financial Markets Authority no later than 7 months after 31 March 2021, ie
by 31 October 2021.
c)
AGREED the Board will engage with the Board’s Actuary and discuss the papers further.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
3.10 Strategy for Managing the NPF Schemes
The Board:
a)
NOTED the paper.
b)
DISCUSSED the paper including:
• The strategy will evolve and be reviewed annually.
• The Board’s respective obligations to members, employers and the Crown.
4
c)
DEFERRED to the next meeting to allow time for consideration and comment, in
particular regarding the balancing of member, employer and Crown interests.
3.11 JP Morgan – Addendum to Custody Fee Agreement
The Board:
a)
NOTED the paper.
b)
APPROVED execution of the JP Morgan Addendum Fee Agreement under common seal
by two authorised signatories.
INVESTMENTS
4.1 Quarterly Investment Performance Report to 30 June 2021
The Board
NOTED and
DISCUSSED the report including:
•
The funds are tracking ahead of objectives except for the E Fund.
•
The inclusion of reporting against a forward investment objective under each Scheme.
•
The new attribution reporting, breaking down returns into beta selection, manager
selection/rebalancing and DAA to provide transparency of the effect of decision making
at a scheme level.
4.2 Investment
Update
The Board:
a)
NOTED the paper.
b)
DISCUSSED:
• Carbon footprint, noting the
portfolio has been adjusted and options are being
considered with respect to s 9(2)(i) and (j) .
• The s 9(2)(i) and (j)
fund, noting it merits a deep dive.
4.3 Global Equities Review
The Board:
a)
NOTED the global equities portfolio has met its excess return, risk-adjusted return
expectations over all measurement periods and performance for July is positive.
b)
NOTED:
•
s 9(2)(i) and (j) has performed above expectations over all measurement periods.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
•
s 9(2)(i) and (j)
has performed above expectations over all measurement periods
•
s 9(2)(i) and (j)
over all periods. Management has reaffirmed its
conviction in
.
c)
NOTED the global equities portfolio has performed creditably compared to other multi-
manager portfolios.
d)
DISCUSSED:
• The fee comparison, noting the s 9(2)(i)
.
5
• The outlook for value versus growth for the next period.
4.4 Manager Appointment, Monitoring and Termination
The Board:
a)
NOTED the paper.
b)
NOTED Management’s processes for the appointment, monitoring and termination of
investment
managers.
SCHEMES
5.1 Schemes
Update
The Board
NOTED the report.
FINANCE
6.1 Schemes
Accounts
The Board
NOTED the paper incorporating the Schemes Financial Statements for the three
months to 30 June 2021.
6.2 Board and Board Reserves Financial Statements to 30 June 2021
The Board:
a)
NOTED the financial statements of the Board of Trustees of the National Provident Fund
for the three months to 30 June 2021.
b)
NOTED the financial statements for the Board Reserves for the three months to 30 June
2021.
7. PAPERS
FOR
NOTING
The Board
NOTED the minutes of the ALCO Committee meeting held on 21 June and 19 July
2021.
8. DELEGATED
DECISIONS
8.1 Use of Common Seal
RELEASED UNDER THE OFFICIAL INFORMATION ACT
The Board
NOTED the report.
8.2 Documents signed on behalf of the Board
The Board
NOTED the report.
8.3 Management decisions made under delegated authority
The Board
NOTED the report.
9. OTHER
BUSINESS
6
There being no other business, the meeting finished at 3.35 pm.
NEXT MEETING: The next scheduled meeting of the Board will be held in Wellington
commencing at
9.30 am on Tuesday, 19 October 2021.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
7
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Zoom video conference
Date
Friday, 17 September 2021 commencing at 1.00 pm
PRESENT
Edward
Schuck
(Chair)*
Stephen
Ward*
Daniel Mussett*
Sarah
Park*
Louise Edwards*
Graham Ansell*
IN ATTENDANCE
Simon Tyler*
Philippa Drury*
Paul
Bevin*
s 9(2)(a)
s 9(2)(a)
DLA Piper
s 9(2)(a)
and s 9(2)(a)
, s 9(2)(i)
APOLOGIES
Nil
* Denotes participants joined the meeting via Zoom.
All Board members confirmed there were no specific interests to declare.
1.
National Provident Pension Scheme
The Board:
a)
NOTED the papers on the total financial management framework (framework) for the
National Provident Pension Scheme (
NPPS).
b)
DISCUSSED:
s 9(2)(h)
s 9(2)(h)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
1
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
2
s 9(2)(h)
s 9(2)(h)
2.
Annuitas Management Limited
The Board:
a)
NOTED the paper.
b)
CONFIRMED Mr Schuck and Mr Ward as the Board’s representatives at the Annual
General Meeting of Annuitas to be held in November 2021 (date to be confirmed).
c)
APPROVED an Annuitas shareholder’s resolution on behalf of the Board under section 122
of the Companies Act 1993 that:
In respect of the Company’s annual report for the year ended 30 June 2021 and pursuant
to section 211(3) of the Companies Act 1993 (the Act), the Company need not comply
with section 211(1)(g) of the Act requiring details of the number of employees and their
remuneration, the value of which exceeds $100,000 to be included in the annual report.
There being no other business, the meeting finished at 2.30 pm.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
3
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Zoom video conference
Date
Monday, 4 October 2021 commencing at 10.00 am
PRESENT
Edward
Schuck
(Chair)*
Stephen
Ward*
Daniel Mussett*
Sarah
Park*
Louise Edwards*
Graham Ansell*
IN ATTENDANCE
Simon Tyler*
Philippa Drury*
s 9(2)(a)
s 9(2)(a)
PricewaterhouseCoopers*
APOLOGIES
Nil
*Denotes participants joined the meeting via Zoom.
All Board members confirmed there were no specific interests to declare.
1.
Defined Contribution and Personal Schemes
The Board:
a)
NOTED the paper and
DISCUSSED the Actuary’s recommendation regarding
s 9(2)(i)
.
b)
APPROVED distribution of the triennial examination for the defined contribution and
personal schemes as at 31 March 2021 to the Financial Markets Authority and to the
Minister of Finance for tabling in the House of Representatives.
2.
National Provident Pension Scheme
The Board:
a)
NOTED the paper.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
b)
DISCUSSED:
o
mortality experience;
o
comment from the Actuary on the difference between actual and expected pensioner
mortality experience, noting that:
- the mortality assumptions adopted for this examination are based on best
estimate; and
- the mortality assumptions are regularly reviewed s 9(2)(i)
c)
NOTED the update of the financial management framework s 9(2)(i)
1
b)
APPROVED distribution of the triennial examination for the National Provident Pension
Scheme as at 31 March 2021 to the Financial Markets Authority and to the Minister of
Finance for tabling in the House of Representatives.
3. DBP
Annuitants
Scheme
The Board:
a)
NOTED the paper.
b)
DISCUSSED the actuarial examination report noting that, given the cost of pension
payments is being met by the Crown as they fall due (under the Crown guarantee), the
value of the liabilities has been calculated using the risk-free discount rates published by
Treasury at 31 March 2021.
c)
APPROVED distribution of the triennial examination for the DBP Annuitants Scheme as
at 31 March 2021 to the Financial Markets Authority and to the Minister of Finance for
tabling in the House of Representatives.
4. s 9(2)(i)
The Board:
a)
NOTED the paper.
b)
s 9(2)(i)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
c)
AGREED it is appropriate for Management to engage with
s 9(2)(i)
.
d)
RESOLVED s 9(2)(i)
2
d)
APPROVED distribution of the triennial examination for s 9(2)(i)
as at 31
March 2021 to the Financial Markets Authority and to the Minister of Finance for tabling
in the House of Representatives.
5. DBP
Contributors
Scheme
The Board:
a)
NOTED the paper.
b)
s 9(2)(i)
c)
NOTED the Actuary will produce an updated triennial actuarial examination report at 31
March 2021, s 9(2)(i)
d)
APPROVED distribution of the updated triennial examination for the DBP Contributors
Scheme as at 31 March 2021 to the Financial Markets Authority and to the Minister of
Finance for tabling in the House of Representatives.
6. Investment
Strategy
Reviews
The Board
REQUESTED the investment strategy reviews for all schemes take into account the
latest possible asset values (not the 31 March 2021 values), new cashflows and value the
liabilities on an EV basis.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
There being no other business, the meeting finished at 12.40 pm.
3
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Level 12, the Todd Building, 95 Customhouse Quay, Wellington,
and Zoom video conference
Date
Tuesday, 19 October 2021 commencing at 9.30am
PRESENT
Edward Schuck (Chair)*
Stephen Ward
Louise Edwards
Graham Ansell*
Daniel Mussett*
Sarah Park
IN ATTENDANCE Simon Tyler
Paul Bevin
Fiona Morgan (up to item 3.5)
s 9(2)(a)
s 9(2)(a)
s 9(2)(a)
Nicky Rumsey (from item 3.6)
s 9(2)(a)
APOLOGIES
Philippa Drury
* Denotes participants joined the meeting via Zoom.
The Board initially met in the absence of Management.
All Board members confirmed there were no specific interests to declare.
1.
MINUTES OF THE BOARD MEETINGS
The Board:
a)
NOTED the 24 August 2021 Board minutes have been updated for the minor amendments
requested by the Board.
c)
AGREED the minutes of the Board meeting held on 24 August 2021
d)
NOTED and
AGREED the minutes of the Board meetings held on 17 September 2021
and 4 October 2021
.
2.
ADMINISTRATION
RELEASED UNDER THE OFFICIAL INFORMATION ACT
2.1 Matters Arising
The Board:
a)
NOTED and
DISCUSSED the Matters Arising.
b)
REQUESTED that the following be added to the work plan:
•
Strategy Documents (Item 3.10 Board meeting 24/8/2021);
•
s 9(2)(i)
(Item 4 Board
meeting 04/10/2021); and
•
DBP Contributors Scheme, updated triennial examination as of 31 March 2021 (Item
5 Board meeting 04/10/2021);
1
2.2 Long Term Work Calendar
The Board:
a)
NOTED the Long-Term Work Plan.
b)
DISCUSSED and
DEFERRED Board self-review, Annuitas Management Limited (AML)
review to Quarter 1 2022.
c)
REQUESTED that CE create a short form to enable the Board to provide feedback on
AML’s services so this can be incorporated into internal performance appraisal
discussions..
d)
NOTED the ARRC self-review would be captured in the minutes for the ARRC meeting
2.3 Interests Register
The Board
NOTED the Interests Register.
3.
KEY PAPERS
3.1 Chief Executive’s Overview
The Board:
a)
NOTED the report.
b)
NOTED the CE’s verbal update on an OIA request for minutes of Board meetings and
details of Board Members’ fees, that there was a delay in responding to the request due
to the request being blocked as spam, interim response and explanation for delay has
been provided and DLA Piper engaged to advise.
c)
DISCUSSED enduring letters of expectations from the Minister of Finance that would be
extended to NPF, the high level of interaction between NPF and CFIs,
NOTED the Chair’s
meeting with the Minister on 14 October 2021.
d)
REQUESTED that the new letter of expectations marked to show what the changes are
since the last such letter and draft response to the Enduring Letter of Expectations be
provided to the Board for consideration at the December 2021 Board meeting, with the
draft response to the Annual Letter of Expectations provided to the Board for
consideration at the February 2022 meeting.
e)
DISCUSSED staff changes and resourcing at Annuitas.
f)
NOTED s 9(2)(a)
resignation from Annuitas, s 9(2)(a)
, acknowledged
his contribution to the team and
REQUESTED a profile for the new recruit into the
investment team.
3.2 Health, Safety and Wellness Update
The Board:
a)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
NOTED and
DISCUSSED the Health and Safety Update and the dashboard, in particular
implications of Covid 19.
b)
NOTED that the Health, Safety and Wellness policy is being updated and guidance sought
from DLA Piper with respect to Covid 19 vaccinations, which may impact on other policies.
3.3 Office Fit Out – L12, The Todd Building
The Board:
a)
NOTED the report.
b)
APPROVED the expenditure of s 9(2)(i)
for changes to the fitout at the
AML office on Level 12 of the Todd Building.
2
c)
RESOLVED to approve a financing arrangement between the Board, as trustee of the
Equity Unit Fund of the Global Asset Trust, and Annuitas to fund the fitout of the
premises on level 12 of The Todd Building on the basis that Annuitas will repay the
financing over
s 9(2)(i)
3.4 Tax Governance
The Board:
a)
NOTED the report.
b)
NOTED that Management will be preparing an updated Tax Policy to replace the existing
NPF4 Taxation policy and will take this to the Audit and Risk Review Committee for review
before presenting it to the Board.
c)
NOTED the Tax Governance Questionnaire being sent out to some NZ businesses by the
Inland Revenue.
s 9(2)(h)
ON ACT
s 9(2)(h)
.
3.6 Aircrew Scheme and DBP Contributions Scheme – Investment Strategy
recommendation
The Board:
INFORM
a)
s 9(2)(i)
b)
REQUESTED that a replacement discussion paper be presented to the Investment
Committee in the first instance with recommendations regarding s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
THE OFFIC
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
3.7 Investment Beliefs Redraft
The Board:
a)
DISCUSSED and
APPROVED the revised Investment Beliefs.
b)
DISCUSSED impact if any on the Investment Beliefs once the Minister’s letter of
expectations is issued.
c)
NOTED the revised Investment Beliefs will be included in the SIPSP.
RELEASED UN
d)
REQUESTED sub-beliefs be drafted (similar to GSF).
3.8 s 9(2)(i)
s 9(2)(i)
3
3.9 Legislative Compliance
The Board
DISCUSSED and
NOTED the legislative compliance executive summary report and
the following that was provided for information.
•
Appendix 1 – Key Legislative Profile
•
Appendix 2 – Legislative Compliance Risk Assessment
•
Appendix 3 – Risk Assessment Matrix
3.10 Policy review
The Board
APPROVED Policy NPF9 Crediting and Reserving Policy.
4. INVESTMENTS
4.1 Investment Update
The Board:
a)
NOTED the report.
b)
NOTED that, following a s 9(2)(i)
c)
NOTED the following would be provided either out of cycle or at the 6 December 2021
meeting:
• report on outcomes of questionnaire circulated to investment managers’
incorporation of ESG and climate factors into their investment processes;
• TCFD aligned report; and
• recommendations to join the Paris-aligned Net Zero Asset Owners’ Commitment, an
Asia-Pac regional group of International Investor Group on Climate Change (AIGCC).
d)
DISCUSSED:
•
s 9(2)(i)
•
s 9(2)(b)(ii)
•
Responsible Investing and Carbon Footprint - Minister’s intention to announce
expectations of CFIs on 28/10/2021 and requirement to confirm joint statement to
be issued by CFIs, in which the Chair will be quoted; and
•
Arrowstreet’s Paris-aligned co-mingled fund.
4.2 NZ Equities Review
The Board:
a)
NOTED the report and that Management s 9(2)(i)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
•
•
•
•
•
•
b)
NOTED Management continues to s 9(2)(i)
4
c)
CONFIRMED continuation of the
d)
NOTED Management will investigate whether s 9(2)(i)
4.3 SIPSP Review by s 9(2)(i)
The Board:
a)
NOTED letter dated 1 October 2021 from s 9(2)(i)
on their findings of the
review of the SIPSIP.
b)
REQUESTED that necessary changes be made to the SIPSP to incorporate Investment
Beliefs.
c)
REQUESTED that a re-write of the SIPSP be added to the workplan to incorporate any
recommendations from s 9(2)(i)
.
4.4 GSFA Reviews: NPF Implications
The Board
DISCUSSED and
NOTED the update on the implications for NPF of the recent
statutory review of the GSFA, including the recommendations of the Burgess review, and
Management’s responses.
5.
SCHEMES
5.1 Schemes Update
The Board:
a)
NOTED the Datacom Connect Limited Monthly Report for August 2021.
b)
RECEIVED a verbal update from Management confirming there are no issues of note to
be brought to the attention of the Board not covered elsewhere in the papers for this
meeting.
c)
DISCUSSED and
NOTED the DB Schemes’ summary, which the Board agreed was
helpful.
d)
REQUESTED the summary continue to be provided for all schemes, amended for
feedback given to Management on additional information and data that could be
included in the summary, in particular funding levels.
6.
FINANCE
6.1 NPF Schemes (GAT) Results to 31 August 2021
The Board
NOTED the report.
6.2 Board and Board Reserves – Financial Statements to 30 April 2021
RELEASED UNDER THE OFFICIAL INFORMATION ACT
The Board:
a)
NOTED the financial information for the Board of Trustees for 5 months ended 31 August
2021.
b)
NOTED the financial information for the Board Reserves for 5 months ended 31 August
2021.
7.
PAPERS FOR NOTING
The Board
NOTED the minutes of the ALCO Committee meetings held on 18 August 2021 and
21 September 2021.
5
8.
DELEGATED DECISIONS
8.1 Use of Common Seal
The Board
NOTED the use of the Common Seal over period 18 August 2021 to 10 October
2021.
8.2 Documents signed on behalf of the Board
The Board
NOTED the report covering the period 18 August 2021 to 10 October 2021.
8.3 Management decisions made under delegated authority
The Board
NOTED the report covering the period 18 August 2021 to 10 October 2021.
9.
OTHER BUSINESS
The Board
NOTED there was no other business.
There being no other business, the meeting finished at 12.30 pm.
NEXT MEETING: The next scheduled meeting of the Board will be held in Wellington
commencing at
1.00 pm on Tuesday, 9 November 2021. The final meeting for the year is
scheduled for Monday 6 December 2021.
RELEASED UNDER THE OFFICIAL INFORMATION ACT
6
Minutes of a
BOARD OF TRUSTEES OF THE NATIONAL PROVIDENT FUND
meeting of
(the Board)
Venue
Level 12, the Todd Building, 95 Customhouse Quay, Wellington,
and Zoom video conference
Date
Tuesday, 9 November 2021 commencing at 1.30pm
PRESENT
Edward Schuck (Chair)*
Stephen Ward*
Louise Edwards*
Graham Ansell*
Daniel Mussett*
Sarah Park*
IN ATTENDANCE Simon Tyler
Paul Bevin
s 9(2)(a)
Philippa Drury
Legal Privilege
s 9(2)(a)
s 9(2)(i)
* Denotes participants joined the meeting via Zoom.
The Board initially met in the absence of s 9(2)(h)
and s 9(2)(i)
.
All Board members confirmed there were no specific interests to declare.
The Chair welcomed s 9(2)(a)
to the
meeting.
1.
Minutes of the Board Meetings
The Board:
a)
DISCUSSED:
(i) Paragraph 2.2(b), noting the ARRC self-review would be captured in the minutes for
the ARRC meeting.
(ii) Paragraph 3.1(d) – a draft response to the Enduring Letter of Expectations will be
provided to the Board for consideration at the December 2021 Board meeting, with
the draft response to the Annual Letter of Expectations going to the February
RELEASED UNDER THE OFFICIAL INFORMATION ACT 2022
meeting.
b)
AGREED the 19 October 2021 Board minutes.
2.
s 9(2)(h)
s 9(2)(h)
a)
s 9(2)(h)
b)
s 9(2)(h)
1
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
s 9(2)(h)
3.
s 9(2)(i)
– NPPS – Draft Financial Management Framework and
Asset Allocation Review
The Board:
a)
RECEIVED comment from s 9(2)(a)
of s 9(2)(i)
on the draft paper on the
Financial Management Framework and Asset Allocation Review for the NPPS.
b)
DISCUSSED:
(i)
The Minimum Risk Rate (
MRR)/Economic Value (
EV) has been used to value the
liabilities – not the expected return on the investment assets.
(ii)_ s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
RELEASED UNDER THE OFFICIAL INFORMATION ACT
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
2
s 9(2)(i)
c)
APPROVED the establishment of the L Fund, either as a new fund or through repurposing
an existing Fund (eg the F2 Fund), under the Global Asset Trust Deed.
d)
AGREED in principle with s 9(2)(i)
e)
RESOLVED s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
s 9(2)(i)
f)
REQUESTED Management seek advice from the Actuary as to the appropriate MSR for
the NPPS for consideration at the Board meeting on 6 December 2021.
g)
REQUESTED a spreadsheet model be developed to facilitate tracking of the framework
(including the MSR) of the NPPS going forward.
4.
Letter of Expectations and Enduring Letter of Expectations
The Board
NOTED the Letter of Expectations and the Enduring Letter of Expectations.
5.
Other Business
The Board
NOTED there was no other business.
There being no other business, the meeting finished at 3.30 pm.
NEXT MEETING: The next scheduled meeting of the Board will be held in Wellington
commencing at
Monday, 6 December 2021 at
10.00 am.
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3
Document Outline
