Jersey Teachers' Superannuation Fund: Approval of Custodian

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A decision made (27.07.2009) to approve the renewal of the contract of the custodian for the Jersey Teachers' Superannuation Fund.

Decision Reference: MD-TR-2009-0126
Decision Summary Title:	Approval of Custodian for the Jersey Teachers’ Superannuation Fund		Date of Decision Summary:	21 July 2009
Decision Summary Author:	Chris Bambury Head of Pensions		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Jersey Teachers’ Superannuation Fund Renewal of Custody Contract with Northern Trust		Date of Written Report:	21 July 2009
Written Report Author:	Chris Bambury Head of Pensions		Written Report : Public or Exempt?	Public
Subject: Jersey Teachers’ Superannuation Fund renewal of custodian contract with Northern Trust
Decision(s): The Minister decided to approve the renewal of the contract with Northern Trust as custodian of the assets of the Jersey Teachers’ Superannuation Fund.
Reason(s) for Decision: Article 10 of the Teachers’ Superannuation (Administration) (Amendment) (Jersey) Order 2007 provides for The Teachers’ Management Board to appoint a custodian subject to the consent of the Minister for Treasury and Resources.
Resource Implications: There are no financial or manpower implications.
Action required: The Treasurer of The States to inform the Secretary of the Jersey Teachers’ Superannuation Fund of the Minister’s decision.
Signature:		Position: Senator P F C Ozouf, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Jersey Teachers' Superannuation Fund: Approval of Custodian

JERSEY TEACHERS’ SUPERANNUATION FUND

RENEWAL OF CUSTODY CONTRACT WITH NORTHERN TRUST

1. BACKGROUND

The States of Jersey Teachers’ Superannuation Fund first entered into a Master Custody Agreement with Northern Trust in November 2003 at which time investment matters were the responsibility of the Finance and Economics Committee’s Investment Sub-Committee.

In April 2007 the governance and management of the Scheme was transferred from the Minister for Education, Sport and Culture to the Jersey Teachers’ Superannuation Fund Management Board.

The Board embarked on a programme of reviewing agreements in place with professional advisers, entering into new agreements where there had previously been none, or updating and renewing agreements where previous versions had become outdated.

In 2008, the JTSF renewed its agreement with Northern Trust which was signed by the Chairman of the Teachers’ Management Board, Ron Amy, on 29 October 2008. There was a view at the time that the changes constituted a novation of the existing contract but further enquiries with Northern Trust have indicated that they consider the agreement to be a new contract.

Accordingly, the current contract will require the Minister for Treasury and Resources approval under Article 10 of the Teachers’ Superannuation (Administration) (Amendment) (Jersey) Order 2007 which states at Para’s 1 & 2 that: -

(1) The Management Board may, with the consent of the Minister for
                   Treasury and Resources, appoint a custodian.

(2)   A custodian shall be appointed under Para (1) on the terms as to
                    remuneration or otherwise that the Management Board and the Minister
                   for Treasury and Resources agree with the custodian.

With respect to (2) the Minister is advised that the fees charged for custody transactions were in step with industry standards at the time the contract was reviewed.

2 REQUIRED

The Minister for Treasury and Resources is requested to confirm his approval of the appointment of Northern Trust as Custodian for the Jersey Teachers Superannuation Fund.

Chris Bambury

Head of Pensions 21 July 2009