The government has published the outcome of its Local Government Pension Scheme (LGPS) 'Fit for the Future' consultation and laid final regulations to overhaul investment and governance arrangements across the scheme.

The new regulations, laid before Parliament on 21 May and due to come into force on 30 June 2026, will make asset pooling a legal requirement for the first time for LGPS administering authorities in England and Wales.

Alongside the regulations, the Ministry of Housing, Communities and Local Government (MHCLG) published its technical consultation response and draft statutory instruments setting out how the reforms will operate in practice.

The government said the reforms are intended to fully consolidate the scheme into asset pools, introduce minimum operating standards, strengthen governance arrangements, and support increased local investment.

Under the new framework, administering authorities will be required to participate in an asset pool, delegate the implementation of their investment strategy to the pool, and ensure that all assets are managed under the pool's oversight.

The reforms also introduce new governance requirements, including mandatory governance, training, and conflict-of-interest strategies; the appointment of senior LGPS officers and independent advisers; and regular independent governance reviews.

The MHCLG said the measures build on progress made since pooling was introduced in 2015, with around 80 per cent of LGPS assets already pooled and £870m in savings achieved to date.

The government also confirmed that implementation timelines had been adjusted following industry feedback, giving funds more time to transfer assets, publish investment strategies and fill new governance roles.

Minister of State for Local Government and Homelessness, Alison McGovern, claimed that the reforms would deliver “better returns, putting money back into local communities, and driving economic growth that people can actually feel”.

Meanwhile, Pensions Minister, Torsten Bell, said: “The reforms are a major milestone that will release the untapped potential of the local government pension scheme, ensuring its £400bn of assets are managed effectively on behalf of members and driving economic growth across the country.”

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