Jersey Teachers Superannuation Fund's Statement of Investment Principles: Amendment

Information about the publication of Ministerial Decisions

A formal published “Ministerial Decision” is required as a record of the decision of a Minister (or an Assistant Minister where they have delegated authority) as they exercise their responsibilities and powers.

Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

An accurate record of “Ministerial Decisions” is vital to effective governance, including:

demonstrating that good governance, and clear lines of accountability and authority, are in place around decisions-making – including the reasons and basis on which a decision is made, and the action required to implement a decision
providing a record of decisions and actions that will be available for examination by States Members, and Panels and Committees of the States Assembly; the public, organisations, and the media; and as a historical record and point of reference for the conduct of public affairs

Ministers are individually accountable to the States Assembly, including for the actions of the departments and agencies which discharge their responsibilities.

The Freedom of Information Law (Jersey) Law 2011 is used as a guide when determining what information is be published. While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.

A decision made on 16 December 2020

Decision Reference: MD-TR-2020-0158
Decision Summary Title:	Amendment to the JTSF Statement of Investment Principles		Date of Decision Summary:	15th December 2020
Decision Summary Author:	Head of Treasury and Investment Management		Decision Summary: Public or Exempt?	Exempt (Article 26)
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Amendment to the JTSF Statement of Investment Principles		Date of Written Report:	15th December 2020
Written Report Author:	Head of Treasury and Investment Management		Written Report : Public or Exempt?	Exempt (Article 26)
Subject: The amendment of the Jersey Teachers Superannuation Fund’s (JTSF) Statement of investment Principles (SIP).
Decision(s): The Minister approved the updated SIP.
Reason(s) for Decision: Under the Teachers Superannuation (Administration) (Jersey) Order 2007, Article 8, (Paragraph 4), the Management Board with the agreement of the Minister for Treasury and Resource shall agree with each investment manager an investment strategy. This paragraph has been interpreted that the Minister is required to approve the Investment strategy of the Fund which will govern the mix of underlying managers who in combination will fulfil the approved strategy. Accordingly, the Management Board has asked the Minister to consent to the adjustment to the investment strategy. The Management Board decisions are based on advice from Aon, the JTSF Investment advisor. The advice and oversight of the decision was supported by an appropriately qualified Officer of Treasury and Exchequer who attended the board meetings where the advice was scrutinised and approved by the management board.
Resource Implications: There are no resource implications from this decision. Any costs stemming from strategy changes will be met from sale proceeds and are expected to be minimal. The changes to strategy will be administered as part of the ongoing responsibilities within the Treasury & Investment Management Team.
Action required: The Head of Financial Governance to advise the Head of Treasury and Investment Management when the decision has been signed. The Treasury and Investment Management Team will ensure the changes are implemented.
Signature:		Position: Deputy S J Pinel, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Jersey Teachers Superannuation Fund's Statement of Investment Principles: Amendment

Treasury and Exchequer

Ministerial Decision Report

Amendment to the JTSF sTATEMENT OF INVESTMENT PRINCIPLES

Purpose of Report

The amendment of the Jersey Teachers Superannuation Fund’s (JTSF) Statement of investment Principles (SIP).

Background

As detailed within the JTSF SIP, the Management Board (the “Board”) is responsible for setting the investment strategy to manage the Fund’s assets in accordance with the relevant orders.

In Q2 2013 the decision was taken by the Board to transfer the majority of the Fund’s assets into the Government of Jersey – Common Investment Fund (“CIF”). Following this decision operational control of the assets was placed with the Government of Jersey Treasury Advisory Panel (“TAP”).

The Board’s main investment decision is to decide the long-term investment strategy. The investment strategy is set following advice from the Board’s investment advisor. Having been approved by the Board, it is referred to the Minister for Treasury & Resources for approval. The investment strategy is kept under annual review by the Board.

A change is being made to the SIP as a result of an Annual Review and reflects advice from Aon, the JTSF Investment advisor. All changes have been reviewed by Officers of Treasury and Exchequer.

The key changes to the document are as follows:

Investment Strategy- the table of strategic allocation ranges has been updated to increase the target allocation to Illiquid Alternatives from 10% to 15% and reduce the allocation to Property from 15% to 10%. This reflects a decision of the Board and improves the return profile and diversification of the overall portfolio.

“Responsible Investment and Corporate Governance”- this has been revised to reflect the enhanced Responsible Investment Policy incorporated into the States of Jersey Investment Strategy Document.

The table of Investment Managers has been updated to reflect changes to the Investment Manager operating mandates in the CIF.

Minor updates were applied to ensure all references were up to date.

Recommendation

The Minister is recommended to approve the updated SIP.

Reason for Decision

Under the Teachers Superannuation (Administration) (Jersey) Order 2007, Article 8, (Paragraph 4), the Management Board with the agreement of the Minister for Treasury and Resource shall agree with each investment manager an investment strategy.

This paragraph has been interpreted that the Minister is required to approve the Investment strategy of the Fund which will govern the mix of underlying managers who in combination will fulfil the approved strategy. Accordingly, the Management Board has asked the Minister to consent to the adjustment to the investment strategy.

The Management Board decisions are based on advice from Aon, the JTSF Investment advisor.

The advice and oversight of the decision was supported by an appropriately qualified Officer of Treasury and Exchequer who attended the board meetings where the advice was scrutinised and approved by the management board.

Resource Implications

There are no resource implications from this decision. Any costs stemming from strategy changes will be met from sale proceeds and are expected to be minimal. The changes to strategy will be administered as part of the ongoing responsibilities within the Treasury & Investment Management Team.

Report author : Head of Treasury and Investment Management	Document date : 15 December2020
Quality Assurance / Review : Director of Treasury ＆ Investment Management/ Head of Financial Governance	File name and path: L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DS, WR and SD\2020-0158 - Amendment to the JTSF Statement Of Investment Principles
MD sponsor : Director of Treasury ＆ Investment Management