UPDATED: Wirral Council & Merseyside Pension Fund in “A bad day at Black Rock”

UPDATED: Wirral Council & Merseyside Pension Fund in “A bad day at Black Rock”

Wirral Council & Merseyside Pension Fund in “A bad day at Black Rock”


This is a rather complicated story in which I’m just going to state the facts and try not jump to conclusions or assumptions, but first a bit of background. Wirral Council is the administering authority for Merseyside Pension Fund which has assets of billions of pounds. The members of the Pension Committee (mainly consisting of Wirral Council councillors) are its trustees.

At tonight’s meeting the members of the Pension Committee will consider at agenda item 9 (gifts and hospitality returns) a report, the M21 Gifts and Hospitality form and the register of CPD (which means continuing professional development) and training.

Here are the entries about Blackrock, first from the M21 form.

Officer’s name Nature of hospitality/gift Value of offer Donor organisation Date of offer Organisation seeking work: Yes/No Offer accepted Yes/No
INVESTMENT MANAGER DINNER – FOLLOWING BUSINESS MEETING £50.00 BLACKROCK 22 Nov 12 Organisation seeking work? No Offer accepted? Yes
Assessment is made by Consultant.
Offer accepted? YES

Now this is the only Blackrock entry from the CPD/Training Form.

Officer’s name Nature of non hospitality Donor organisation Value of offer Date of offer Organisation seeking work: Yes/No

So what you may ask?

Well at the Pension Committee meeting of the 16th September the Pension Committee received a report on Medium Term Asset Allocation Implementation of Framework along with two exempt appendices that I’ll publish here, exempt appendix 1 entitled “Framework for Implementation of Active Management of Medium Term Asset Allocation Revised as at 30th August 2013” and exempt appendix 2 entitled Overlay Manager Review (the Fund) 10th July 2013.

The latter exempt appendix 2, a report of Aon Hewitt Limited goes into detail of the two proposals from Blackrock and Northern Trust to be an overlay manager for the Merseyside Pension Fund. Blackrock’s proposed flat fee is £150,000 a year, Northern Rock’s is somewhere between £50,000 and £300,000 a year. The report states that “Blackrock’s fee is more competitive” and concludes by stating “However, having considered each key criterion, we believe BlackRock would provide a stronger overlay partner for the Fund”.

Exempt appendix 1 states in “next steps” at 9.1 “Officers are in the process of conducting contractual due diligence with Black Rock. Once complete BlackRock will set up the QIF and MPF will fund in cash approximately £50m (The cash will be largely be utilised as collateral for derivative instruments).”

The report makes clear at 2.2 that “Since the Pensions Committee [of the 24th June] and following advice from Aon Hewitt, BlackRock have been appointed as the Overlay Manager.”

So why did an investment manager of the Merseyside Pension Fund accept dinner from Blackrock on the 22nd May 2013, an organisation seeking work to the value of £150,000 a year from Merseyside Pension Fund, that ultimately won the contract? Will the “assessment made by consultant” into this practice be published? Will there be any questions into this asked of officers by members of the Pension Committee tonight? We’ll just have to wait and see.

UPDATED 20/11/13: The item on gifts and hospitality returns attracted no questions from members of the Pension Committee during the meeting itself, no calls for the assessment to be published and no explanations from officers. One other interesting thing about the M21 form and CPD form is officer’s names aren’t given under the heading officer’s name, just job descriptions.

UPDATED 25/11/13: In response to this FOI request, Wirral Council responded as follows:

“1. The ‘Assessment by consultant’ referred to in the M21 form does indeed refer to an exercise commissioned from the Fund’s strategic consultant, Aon Hewitt. The purpose of the exercise was to make recommendations to Fund officers on the appointment of a medium term asset allocation overlay manager. The original exercise had been to carry out due diligence on the Fund’s existing custodian bank, Northern Trust, to fulfill the role of overlay manager. However, concerns of a regulatory nature were raised by Aon Hewitt and it was decided to investigate alternative solutions alongside this by accessing the Fund’s Transition Manager Framework. BlackRock were a participant in the Framework, having previously gone through a competitive tendering process, and out of all of the Framework participants approached were the only one able and willing to carry out the role of overlay manager. Aon Hewitt were then asked to compare the suitability of BlackRock and Northern Trust to deliver the overlay manager service and make a recommendation to officers.

2. BlackRock were, and continue to be, an appointed investment manager for the Fund; currently managing over £300 million of Fund assets.

3. The Head of Merseyside Pension Fund made the final decision to appoint BlackRock as overlay manager for the Fund, on advice from Aon Hewitt and acting under delegated authority. This decision was reported to the Pension Committee at their meeting in September 2013.”

If you click on any of these buttons below, you’ll be doing me a favour by sharing this article with other people. Thanks:

Wirral Council’s Pensions Committee bans filming and public from public meeting on “health and safety grounds”

Wirral Council bans public from filming Pensions Committee on “health and safety” grounds.

Wirral Council bans filming and public from public meeting Bizarrely at the start of the Pension Committee all members of the public were asked to leave by the Chair (who seemed to conveniently forget that the public have a legal right to be there).

What followed was twenty minutes of discussion as to whether to allow filming at the meeting. Quite exactly what took place during that twenty minutes, I can only report based on the snippets heard as Cllr Harry Smith’s voice reverberated through the closed-door as he told the Committee how “upsetting” he found filming. Getting into his stride he used one of his favourite words “political” not just once but multiple times and said it should be banned because I was a member of a political party (untrue). He said he had no issue with anyone else filming who was “non-political” but then tried to say I am a member of the Liberal Democrats (which I’m not), then contradicting himself in the same sentence by referring to me as an independent. As Peter Cook put it once, “You may choose if you wish to believe a transparent tissue of odious lies, that streamed on and on ….. that is entirely a matter for you.”

When it was pointed out by another councillor that this was irrelevant to the issue of filming the meeting, Cllr Harry Smith just looked even more irate, seemingly unused to any councillor (or in fact anybody) having the temerity to tell him he was being irrelevant.

When the public returned Cllr Ann McLachlan read out a recommendation that at least from where I was sitting couldn’t be heard. Another councillor then tabled an amendment to “current Committee meeting” as it was subject to a review. Cllr Adrian Jones asked him to repeat what he’d said as he hadn’t heard it. He repeated it, Cllr George Davies shouted “current” at Cllr Adrian Jones followed by the Chair saying “at the moment”.

Despite separate votes being required for the amendment and resolution only one vote was taken, 8:5 on the amended resolution.

The Chair, Cllr Patricia Glasman then said, “So the resolution is carried, OK, so ladies and gentlemen, Mr and Mrs Brace, you may not film this meeting tonight on the basis that your equipment has not been…, it does actually say that you would have to have a health and safety agreement to use your equipment and that that’s because of errm a review, which is currently Council is looking into the issue of filming.”

John Brace, “Would it be ok if I filmed without the tripod, is that the issue?”

Chair, Cllr Patricia Glasman, “Errm, well the tripod is one of the issues, but no, we’ve had a resolution, asking you not to film the meeting.”

John Brace, “Can I have a copy of the resolution if possible?”

Pension Committee (Wirral Council) 20th November 2012 Part 2

Pension Committee (Wirral Council) 20th November 2012 Part 2

So, after the vote to ban filming at the Pension Committee what happened next?

Well first a list of who was there (apologies for not including councillors from other Merseyside councils I don’t know the names of)

Pensions Committee
Cllr Patricia Glasman, Chair
Cllr Geoffrey Watt
Cllr Mike Hornby
Cllr Adam Sykes
Cllr Tom Harney
Cllr Adrian Jones
Cllr Sylvia Hodrien
Cllr Harry Smith
Cllr Ann McLachlan
Cllr George Davies
Phil Goodwin (trade union representative)

Wirral Council Officers
Colin Hughes
Peter Timmins
Pat Philips
+ others from the Merseyside Pension Fund

A declaration of interest was made as the person was a member of the Merseyside Pension Fund.

The minutes were agreed.

An officer gave a brief summary of a LGPS Update report which included the Merseyside Pension Fund response to the Department of Communities and Local Government on the impacts of the Public Service Pension Bill on the Merseyside Pension Fund.

No questions were asked, the report was noted and the letter was noted.

An officer then asked for approval for the Statement of Investment Principles which was an appendix to a report which they said “do not constitute a change in investment strategy”.

The Chair asked how long it would take? The answer given by the officer was that they intended to sign it by the end of November.

Cllr Harry Smith said that he understood the reason some documents were hyperlinked and that he had “calmed down now”.

Cllr Watt commented on the links, Phil Goodwin commented on the same issue and the Chair said it would be revisited next year. The recommendation was agreed.

Yvonne Caddock introduced the report on Annual Allowance Tax Charge and Scheme Pays Process, which related to how much a person can pay into the pension scheme each year without incurring a tax charge.

A councillor asked about the numbers of how many were likely to be affected?
Yvonne answered that they had got it down to about ninety members in the Fund, who they would have to issue pension statements for but that there may be seven or eight members that exceeded the new limit which would lead to a tax charge.

Cllr Geoffrey Watt made a comment. The recommendations were agreed.

Peter Wallach said they’d been shortlisted for the LGC Investment Awards 2012 and asked if the Pension Committee wanted to be represented at the awards ceremony and if so how many?

The Chair asked for comments. Cllr Harry Smith suggested three councillors, one from Labour, one from the Conservatives and one from the Lib Dems.

The Chair suggested that they add the Head of the Fund too. Cllr Geoffrey Watt asked which category they had been shortlisted in? The answer given was large pension fund of the year. They all voted in favour of sending three councillors and the head of the Fund to the awards ceremony at The Royal Garden Hotel, Kensington, London in December.


Labour ban filming at public meeting of Wirral Council’s Pensions Committee

Labour Chair of Pensions Committee Cllr Pat Glasman bans filming at public meeting

Please accept YouTube cookies to play this video. By accepting you will be accessing content from YouTube, a service provided by an external third party.

YouTube privacy policy

If you accept this notice, your choice will be saved and the page will refresh.

In extraordinary scenes tonight, Labour councillors at Wirral Council (where else?) chose to ban filming during a public meeting of the Pension Committee. The Pension Committee has eleven Wirral Council councillors on it, along with a councillor from each other Merseyside local authority and a trade union representative. Wirral Council are the administering authority for the £4.7 billion Merseyside Pension Fund, which at its last valuation had a £1.3 billion deficit. Quite what are the real reasons behind this move we’re not entirely sure, although it makes the public wonder what they’ve got to hide (agenda and reports on Wirral Council’s website here)?

I quote from this letter from their previous Director of Law, Bill Norman dated 22nd July 2011 “Finally, I can confirm that, since Monday 28 February 2011, blogging, Tweeting and the use of video cameras have all been permitted during meetings of the Council. Indeed, a number of people were using some of these technologies in the meeting on 1 March. Wirral Council was the first local authority in Merseyside to respond to the request by the Government to take this step to allow greater public scrutiny of meetings and decisions.”

The below was also agreed as Wirral Council policy (agreed unanimously on 12th December 2011),

(2) Reaffirms its commitment, made last year by the previous Conservative Liberal Democrat administration, to ensure that any member of the public who wishes to film or broadcast from a public Council meeting is encouraged to do so.

However since taking over in May, some Labour councillors seem determined to make decisions that ride roughshod over agreed policy or decisions they don’t agree with (such as the Budget for 2012/2013 agreed by the former Conservative/Lib Dem administration). Certainly the last time the former Chair of the Planning Committee, Cllr David Elderton tried this just over a year ago, there was a U-turn within a few days.

It’ll be interesting to see (pun intended) what happens next.