The Strathclyde Pension Fund Committee held its regular quarterly meeting today.
As a result of sharp declines in equity and property markets, the Fund’s investments returned –7.1% in the quarter to 31 March 2008. The FTSE All Share returned -9.9% in the quarter, the IPD Property Index -3.4% and the FTSE World index -8.7%.
The Fund ‘s value at 31 March was £9.3bn (that had risen to £9.7bn at 30 April). Its funding position had reduced from an estimated 100% at the end of December 2007 to 89% at the end of March 2008.
The No.3 Fund’s funding position had reduced from 96% to 88% over the same period. Its ongoing derisking continued with the transfer of bonds from Schroders to Legal & General.
In conjunction with KPMG the Fund has identified that the legality of European member states’ tax rules may be challenged. A successful challenge could result in a windfall of up to £30m to the Fund.
The Fund completed its annual review of managers and mandates. This has identified several issues that will be considered further in a review of investment strategy that will be progressed over the next year. A tendering process for a bond manager will be started at an early date.
As a result of the major initiative on membership data, outstanding errors amongst major employers have been reduced to 9.3% from 14.8% over the quarter.
Three new Admitted Bodies (new employers) were given permission to participate in the Fund: Regen FX Youth Trust, Skills Developments Scotland Ltd, Highlands and Islands Enterprise.
To view the agenda, reports and minutes of the meeting follow this link.