WELSH CHURCH ACT ESTATE COMMITTEE
Minutes of a meeting held on 3rd October, 2016.
Present: Councillor F.T. Johnson (Chairman); Councillor A.G. Powell (Vice-Chairman); Councillors G.A. Cox, C.P. Franks, H.C. Hamilton and K.P. Mahoney.
399 APOLOGY FOR ABSENCE -
This was received from Councillor R.P. Thomas.
400 MINUTES -
RESOLVED - T H A T the minutes of the meeting held on 4th July, 2016 be approved as a correct record.
401 DECLARATIONS OF INTEREST -
Councillor F.T. Johnson declared an interest in Agenda Item No. 6 - Applications for Financial Assistance 2016/17. The nature of the interest was that an application had been received from the Civil Aid Voluntary Rescue Association (CAVRA) for financial support for a new roof at Sully Sports Club and Councillor Johnson was employed as the Company Secretary/Director at Sully Sports and Social Club. Councillor Johnson vacated the Chair and the room whilst this application was under consideration.
Councillor A.G. Powell declared an interest in Agenda Item No. 6 - Applications for Financial Assistance 2016/17. The nature of the interest was that Councillor Powell was a member of Sully Sports and Social Club. Councillor Powell vacated the room whilst this application was under consideration.
402 PRESENTATION - INVESTMENT PORTFOLIO UPDATE - TOWRY LIMITED -
Bronwen Lancaster, Chartered Financial Planner for Towry Limited, provided the Committee with an update on the investment portfolio of the Welsh Church Act Estate Trust. Ms. Lancaster informed the Committee that the investment portfolio had been changed over to discretionary investment management last year which meant that the portfolio was more actively managed on a day to day basis in order to avoid loss and maximise return. Originally £837,000 had been invested in the advisory portfolio, and £760,000 was invested in December 2016 when the portfolio was changed over to discretionary management. Since the changeover the return had been good, and Towry were very pleased with the investment performance.
The Committee was informed that Towry had recently been acquired by Tilney earlier in the year via a planned acquisition. The organisations were of a similar size and the acquisition was more akin to a merger of two businesses. The merger meant that there would be more expertise within the organisation and there was new set of Investment Managers.
A Member asked whether there was a more dominant company and in response Ms. Lancaster advised that Towry was the larger company in terms of employees but Tilney had bought them and the acquisition was a merger of two like firms. A Member asked if there was going to be a significant change in the management of the company and Ms. Lancaster advised that there was a new Chief Executive, but the Executive Committee was largely the same and made up of Towry employees. Ms. Lancaster advised that it was business as usual. The charges for their services would be reduced as the new company had more bulk buying and purchasing power. It was advised that Towry operated more in financial advice and investment whereas Tilney did more investment work and the combined value of the two companies was approximately £20 billion.
Ms. Lancaster summarised the objectives of the Trust for the Committee, one of which was to invest the Trust assets to generate a natural income of approximately £40,000 per year, payable on a quarterly basis, and to distribute it in accordance with the Trust’s provisions. As it was a charitable trust it was important that the Trust’s assets were managed in an ethical manner and avoid risk as much as possible.
The current total investment was £1,685,091.97 compared to £1,586,477 in January 2016. It was advised the Trust’s investments could change on a day to day basis dependent on the markets and risks involved. There had been growth of 6.2% on the underlying investments since January 2016 and Towry was very pleased with the performance of the portfolio. In terms of income the objective was to generate a natural income of £40,000 per year. Overall a natural income had been paid out of nearly £18,000 since April 2016, therefore, the portfolio was on track to provide the yearly £40,000 natural income. Ms. Lancaster advised that the markets had been very volatile since Brexit, however, the investment had held its own and recovered quickly. It was confirmed that the portfolio was invested at a low risk and the portfolio was managed with the full ethical investment screening, which helped to ensure, that as far as was possible, the investments were made in ethical companies.
Ms. Lancaster advised that they ensured that the assets were balanced and spread across different companies in order to smooth out any volatility. As Towry did not only buy funds with the Trust’s monies, they were able to negotiate down costs and took a cautious approach in terms of investment management. A Member asked whether it was possible to say whether the substantial drop in Sterling would have an effect on the investment. Ms. Lancaster advised that their currency investments were held in US Dollars, which was another way to smooth out volatility, therefore if the value of Sterling fell they could employ countermeasures to ensure the value of the investments didn’t fall.
Following the presentation from Towry Limited and there being no further questions, the Committee
RESOLVED - T H A T the contents of the update presentation on the Trust’s Investment portfolio be noted.
Reason for decision
To note the content of the presentation and the progress of the Trust’s Investment portfolio.
403 ANNUAL REPORT AND ACCOUNTS 2015/16 (MD) -
The Committee received a report on the Charities (Accounts & Reports) Regulations 2008 required that the Annual Report and Accounts should be approved by the Trustees as a body in accordance with their normal administrative procedures.
The Annual Report and Accounts for the year ended 31st March, 2015 were attached to the report at Appendix A.
There had been a new Charities Statement of Recommended Practice (SORP) introduced for the 2015/16 accounts which had changed the format and terminology used in the main statements. The new SORP also introduced the requirement for a cashflow statement. A policy on reserves had also been introduced for 2015/16 accounts.
The main features of the report, when compared to the previous year, were as follows:
Statement of Financial Activities
The deficit of £17,000 increased from a deficit of £5,000 in 2014/15, this was due to a reduction in investment (£6,000) and rental income (£,000k) in 2015/16 and a slight increase in grant making activity (£8,000) in year. There was a reduction in expenditure on repairs and maintenance in 2015/16 of £8,000.
Balance Sheet
There was a reduction in the value of Investment Properties for the sale of Southerndown £450,000, and an increase in the value of Investments £693,000 mainly due to the investment of the proceeds from the sale of Southerndown.
The value of the fund at year end was £4,803,000, an increase of £225,000 on the previous year. This was mainly due to the profit made on the disposal of Southerndown £316,000, partly offset by the reduction in the value of investments £68,000. The fund was also reduced by £17,000 for the deficit on the revenue account.
Subject to approval, the document was to be forwarded to the Council's external auditors, Wales Audit Office, for independent examination.
Following consideration of the report the Committee
RESOLVED - T H A T the Annual Report and Accounts 2015/16, as set out at Appendix A, be approved and that the Chairman be authorised to sign the same on behalf of the Trustees.
Reason for decision
In accordance with the requirements of the Charities Act 2011 and the Charities (Accounts and Reports) Regulations 2008.
404 APPLICATIONS FOR FINANCIAL ASSISTANCE 2016/17 (MD) -
Consideration was given to the applications for financial assistance as set out in Appendix A to the report, the purposes for which the Welsh Church Act fund may make grants was set out in summary at Appendix B to the report.
Committee was informed that the range of the applications had increased significantly during 2016/17 and therefore, it was considered that a review of the criteria used to allocate funding was required for 2017/18.
The Committee was also informed of the Fund’s revenue estimates for the current financial year, which were set out at Appendix C to the report.
Two members of the public were present at the meeting from All Saints Parish, Penarth. The Chairman permitted one of the representatives present to address the Committee in relation to this application for financial assistance. They made representations to the Committee in relation to the application, for a contribution of £10,000 for the building of a car park at St. Peter’s Church.
The Chairman and Vice-Chairman vacated the room only whilst the Committee considered the application for financial assistance from the Civil Aid Voluntary Rescue Association (CAVRA) as both Members had declared an interest on this item of business, they were present for the other items of business.
Councillor Cox was duly appointed Chairman for this item of business.
Members expressed the view that further information was required in order to establish that CAVRA had security of tenure for the equipment store buildings and expressed concern that there was a planning application for Sully Sports and Social Club site, therefore there was potential that the equipment store garages could be demolished.
RESOLVED -
(1) T H A T the applications for financial assistance as detailed below be approved.
|
Name of Organisation
|
Specific Purpose for Which Grant Requested
|
Grant Awarded
|
|
Triumph Over Phobia
|
Set up of self-help therapy group in Cardiff
|
£500
|
|
Cardiff International Church
|
Repairs to flat roof at Cardiff International Church
|
£2,000
|
|
All Saints Church, Penarth
|
Organ Appeal
|
£2,000
|
|
Clybiau Plant Cymru Kids Clubs
|
Play worker workshops
|
£500
|
|
St. Nicholas Parish Church
|
Re-roofing and associated works
|
£1,000
|
|
Relief in Need Re LD c/o JC Mental Health Tenancy Support Worker
|
Assistance with decoration costs to accommodate granddaughter
|
£100
|
|
Cardiff City FC Foundation
|
Funding for the Foundation All Skilled Up Literacy Project
|
£2,000
|
|
Croes y Parc Baptist Church
|
Sunday School building project
|
£1,000
|
|
The Parish of St. Marys, Whitchurch
|
Repair and replace flat roofs and damaged capstone at church community hall
|
£2,000
|
|
Beulah United Reform Church
|
Repair leaking wall and replace roof of garage/work for Rhiwbina Church Community Garden
|
£1,000
|
|
Shelter Cymru
|
Staff costs - Housing Services Advisor
|
£1,000
|
|
Wenvoe Ladies Leisure Group
|
Funds to support running of the club
|
£100
|
(2) T H A T the grant application received for All Saints Parish Penarth be deferred until Tranche 3.
(3) T H A T a further report be brought to the next Committee reviewing the existing process used to recommend proposals for financial assistance in order to identify any improvements.
(4) T H A T the grant application received for Civil Aid Voluntary Rescue Association (CAVRA) be deferred for further information.
Reasons for decisions
(1-3) In furtherance of the objectives of the Trust.
(4) In order that further information can be gathered in relation to the security of tenure for the equipment store buildings and the potential implications of the planning application on this request for financial assistance.