Directions by the Secretary of State
8.—(1) This regulation applies in relation to an authority’s investment functions under these Regulations and the 2013 Regulations if the Secretary of State is satisfied that the authority is failing to act in accordance with guidance issued under regulation 7(1).
(2) Where this regulation applies in relation to an authority the Secretary of State may make a direction requiring all or any of the following—
(a)that the authority make such changes to its investment strategy under regulation 7 as the Secretary of State considers appropriate, within such period of time as is specified in the direction;
(b)that the authority invest such assets or descriptions of assets as are specified in the direction in such manner as is specified in the direction;
(c)that the investment functions of the authority under these Regulations and under the 2013 Regulations be exercised by the Secretary of State or a person nominated by the Secretary of State for a period specified in the direction or for so long as the Secretary of State considers appropriate;
(d)that the authority comply with any instructions of the Secretary of State or the Secretary of State’s nominee in relation to the exercise of its investment functions under these Regulations and the 2013 Regulations and provide such assistance as the Secretary of State or the Secretary of State’s nominee may require for the purpose of exercising those functions.
(3) Before making a decision whether to issue a direction under this regulation, and as to the contents of any direction, the Secretary of State must consult the authority concerned.
(4) In reaching a decision whether to issue a direction under this regulation, and as to the contents of any direction, the Secretary of State must have regard to such evidence of the manner in which the authority is discharging or proposes to discharge its investment functions as is reasonably available including—
(a)any report from an actuary appointed under section 13(4) of the Public Service Pensions Act 2013 (employer contributions in funded schemes) or by the authority under regulation 62 of the 2013 Regulations (actuarial valuations of pension funds);
(b)any report from the local pension board appointed by the authority or from the Local Government Pension Scheme Advisory Board(1);
(c)any representations made by the authority in response to the consultation under paragraph (3);
(d)any other evidence that the Secretary of State regards as relevant to whether the authority has been complying with these Regulations or acting in accordance with guidance issued under regulation 7(1).
(5) If the Secretary of State is of the opinion that additional information is required to enable a decision to be taken whether to issue a direction under this regulation, or as to what any direction should contain, the Secretary of State may carry out such inquiries as the Secretary of State considers appropriate to obtain that information.
(6) An authority must comply with any request from the Secretary of State intended to facilitate the obtaining of information under paragraph (5).
The Local Government Pension Scheme Advisory Board is established by regulation 110 of the 2013 Regulations (which was inserted by S.I. 2015/57).