MINUTES OF THE TWELFTH MEETING OF THE PENSION TRUSTEES HELD ON MONDAY 20TH MAY 2002 AT 13H00 IN ROOM 106

1. Matters Arising
2. Notes
3. Trustee's Meetings
4. Benefits Statement
5. Other Business

PRESENT:
MR D Watson
MR M Carrick
MR D McClarty
MR J Kelly

IN THE CHAIR:
MR D Watson

APOLOGIES:
MR J Dallat

IN ATTENDANCE:
MR T Evans, MR E Hobson, MS A Whitaker, MS D Johnston

Minutes of 15th April meeting were accepted

1. MATTERS ARISING

Representatives from RLAM, Mr Rick Dentith and Mr John Kilcommons made a presentation to the Trustees on the management of the Pension Fund over the twelve month period to 31 March 2002 and highlighted what they hoped to achieve in the following twelve month period. Mr Kilcommons explained that it had been a very difficult year for investments and that the pension fund had under performed relative to its peer group.

Mr John Kelly excused himself from the meeting at this point. (1.20pm).

Mr Dentith explained that the signs are that the economic background is at present improving. He explained that although the return on investment in the first year was very disappointing RLAM are working towards a three year target when he expected returns to improve significantly. Mr Dentith highlighted what changes RLAM proposed to make to their organisation in an effort to improve next year's performance.

Having considered the RLAM presentation Mr Watson expressed his deep disappointment in the performance of the fund over the year. The other Trustees also expressed their concern about the poor performance of the pension fund pointing out that they would probably come in for some criticism from members of the Pension Scheme when the facts were published in the forthcoming Annual Accounts.

Mr Mervyn Carrick excused himself from the meeting at this point (1.35pm).

(A quorum was no longer present but it was agreed that the meeting should continue)

2. NOTES

Continuing on the subject of the Pension Fund investment performance, Mr Evans suggested to the Chairman that the RLAM should be asked to make more frequent reports to the Trustees regarding investment performance. The Chairman agreed that RLAM should be asked to report directly to the Trustees on a quarterly basis for the foreseeable future. Mr McClarty asked what figures from the investments will be shown in the year end accounts. Mr Hobson confirmed that the mini report provided by RLAM would be included which will show all losses made to the fund.

At this point Mr Dentith and Mr Kilcommons left the meeting.

3. TRUSTEE'S MEETINGS

The problem of getting a quorum during the Trustee's meeting was highlighted. It was suggested that the Chairman would write to the other Trustees highlighting the problems which arise when Trustees meetings are not quorate. He stressed that important decisions cannot be made at times, which left the Trustees open to criticism for not fulfilling their statutory responsibilities.

The Chairman suggested that set dates should be set aside for regular meetings and that these should be agreed in advance by the Trustees. Mr Evans suggested that there was a need for at least two further Trustee meetings before the recess to discuss and agree on a number of important issues e.g. the NIAO report highlighting a number of queries regarding the Annual Accounts.

Action: Mr Evans to draft a letter to Trustees from the Chairman to explain that they are in danger of not fulfilling their statutory responsibilities as the Trustees meetings have not been quorate for a significant period of time and important issues could not be resolved.

4. BENEFITS STATEMENT

Mr Hobson reminded the Trustees that they had asked for views on the possibility of issuing Benefit Statements to members on a regular basis. He asked the Trustees how often did they feel the Members should be issued with benefits statements and what information would be beneficial for them to receive now.

It was agreed that the statements should be issued to all members of the Pension Scheme as soon as possible and that they would give figures for the end of last financial year (31 March 2002) and also an estimate of benefits at 5 May 2003.

Mr Hobson brought up the possibility of representatives from the Government Actuaries Department attending a future Trustees meeting to explain the methodology behind the statutory requirement for the Government Actuaries Department to carry out a valuation of the fund every three years. It was agreed that this would be arranged to coincide with the next Trustees meeting.

5. DATE OF NEXT MEETING

10th June 2002 at 13h00.