Donna Smith, Head of Finance & Risk, presented a report that requested that Members approve the budget for the financial year 2021/22.

The budget for 2021/22 was attached as appendix 1 to the report.

The headline figures were that, during the financial year 2021/22, it was estimated that MPF would pay £368m in pensions and receive £172m in contributions from employers and employees. The Fund had a value of £9.8bn at 31December 2020. The proposed administration costs of £25.5m including £17.4m of investment management charges to external managers represented a cost of £182.44 per member of the scheme or 0.26% of assets under management. Taken separately the external investment management costs were approximately £124.01 per member or 0.18% of assets under management.

The budget for 2021/22 was higher at £25.5m than £23.0 in 2020/21 primarily due to higher investment management fees, principally, as a consequence of outperformance by external investment managers during the pandemic induced market volatility.

The Fund was undertaking a number of initiatives to increase efficiencies and deliver savings, particularly from investments, over the medium term.

Resolved – That;

1  the budget for 2021/22 be approved. (Subject to review of charges from the administering authority for support services).

2  a further report on the outturn for 2020/21 with finalised estimates in particular for departmental & central support charges and any known changes in supplies and services for 2021/22 be presented to Members of Pensions Committee at a future meeting.