The Pensions and Investments Committee of Derbyshire County Council met on Wednesday, 4 March 2026, to review the fund's investment performance and strategy, approve an addendum to the Investment Strategy Statement, and discuss the 2026-27 Service Plan and budget. Key decisions included approving the updated Investment Strategy Statement addendum and the proposed Service Plan and budget, while also noting the fund's stewardship activities and the cessation of its signatory status to the UK Stewardship Code.

Investment Report

The committee reviewed the Derbyshire Pension Fund's investment performance and strategy. Anthony Fletcher, the independent external adviser, presented his report, which included an overview of market returns, an analysis of the fund's performance against its benchmark, and an outlook for the economic and market environment. Neil Smith, Investments Manager, also presented a report detailing the fund's asset allocation, investment activity, and long-term performance. The committee noted Mr Fletcher's report and the asset allocations, and approved the recommendations outlined in the report, which aimed to align the fund's investment strategy with market conditions and the fund's objectives.

Investment Strategy Statement Addendum

The committee considered an addendum to the Derbyshire Pension Fund's Investment Strategy Statement (ISS). This addendum was necessary to align the fund's Strategic Asset Allocation Benchmark (SAAB) with new guidance expected from the Ministry of Housing, Communities and Local Government (MHCLG) regarding investment strategy statements for Local Government Pension Scheme (LGPS) funds. The proposed changes involved reclassifying the fund's existing asset classes into nine categories as specified by the MHCLG guidance, with no change to the overall composition of the fund's investments. The committee approved the addendum, which will be effective from 1 April 2026, and noted that a full update of the ISS would follow by September 2026.

Derbyshire Pension Fund 2026-27 Service Plan

Dawn Kinley, Head of Pension Fund, presented the Derbyshire Pension Fund's Service Plan for 2026-27, which included the proposed annual budget of £42.434 million. The plan detailed the fund's objectives, key services, achievements from the previous year, and medium-term priorities. The budget represented a 7.7% increase on the adjusted 2025-26 budget, attributed to factors such as anticipated pay increases, expected rises in charges from LGPS Central Limited (LGPSC), a forecast increase in assets under management, and changes in the asset mix. The committee approved the Service Plan and the proposed budget.

Treasury Management Strategy 2026-27

Neil Smith, Investments Manager, presented the draft Treasury Management Strategy for Derbyshire Pension Fund for 2026-27. The strategy prioritises the security of capital and liquidity over investment return, aligning with the County Council's Treasury Management Strategy. It noted that the fund's cash holdings were expected to decrease over 2026-27 as day-to-day management of investment cash transitions to LGPSC. The strategy outlined investment objectives, counterparty limits, and risk management indicators, with no significant changes from the previous year's strategy other than the impact of the forthcoming Fit for the Future guidance on asset pooling. The committee approved the draft Treasury Management Strategy.

Funding Strategy Statement Consultation

Steve Webster, Pension Services Manager – Employers, presented the outcome of the consultation on the proposed Funding Strategy Statement (FSS) for Derbyshire Pension Fund. The FSS, prepared in accordance with new MHCLG guidance, included updates such as a provision for a target funding level above 100%, increased likelihoods of success across employer categories, and enhanced flexibility within the stabilisation mechanism for academies. Two responses were received during the consultation: one from the Department for Education (DfE) and one from the University of Derby. Following a review, the fund determined that no changes to the draft FSS were required. The committee confirmed that no further amendments were needed and approved the final Funding Strategy Statement.

Stewardship Report

Neil Smith introduced a report providing an overview of the stewardship activities undertaken by LGPS Central Limited (LGPSC), the fund's pooling company. The report noted that the fund's signatory status to the UK Stewardship Code 2020 ceased in January 2026, as the fund did not submit an application for the new Code. The fund is currently assessing the best way to participate in the updated Code. The committee noted the stewardship activities of LGPSC and the cessation of the fund's signatory status to the UK Stewardship Code 2020.

Other Matters

The committee also received updates on the Derbyshire Pension Fund Actuarial Valuation at 31 March 2025, LGPS Fit for the Future implementation, a half-year pension administration performance report, the Risk Register, and the Climate Risk Management Report. Confidential appendices related to the Climate Risk Management Report and investment pooling were also discussed.