The market value of Local Government Pension Scheme (LGPS) funds rose by 2.7 per cent, or around £10.7bn, over the past year, rising to £402.3bn at the end of March 2025, the latest government data has revealed.

The LGPS figures, shared by the Ministry of Housing, Communities & Local Government (MHCLG), revealed that total LGPS expenditure in England and Wales had increased in 2024/25, rising by 11.7 per cent to £19.1bn, which was mainly due to an increase in expenditure on pensions and annuities.

Indeed, the analysis showed that expenditure on benefits in 2024/25 had risen by 12 per cent to £15.4bn, with expenditure on pensions and annuities making up £12.4bn of this.

Disposal of liabilities, meanwhile, totalled £1.4bn in 2024/25, an increase of 13.8 per cent, and costs charged to the funds were £2.3bn, an increase of 8.6 per cent.

At the same time, however, total LGPS income in England and Wales in 2024-25 increased by 5.2 per cent, around £1.1bn, to £21.7bn, thanks to an increase in investment income, which rose by 18 per cent.

Employees' contributions to the scheme also rose by 5.8 per cent to £3.2bn.

And whilst employers’ Contributions to the LGPS in 2024-25 in England and Wales amounted to £10.1bn, a decrease of 3.9 per cent compared to 2023-24, the MGCLG explained that this decrease is to be expected after the first year of a triennial review period, where some employers make early payments in the first year.

The update also provided further analysis into the membership of the LGPS, which stood at 6.9 million people at the end of March 2025, revealing that 2.2 million are employees who still contribute to the scheme, while 2.2 million are pensioners and 2.5 million are former employees who are entitled to a pension at some time in the future.

In 2024/25 in particular, there were 110,678 retirements from the LGPS, marking an 11.2 per cent year-on-year increase, while the number of employees having their deferred benefits paid early increased by 11.7 per cent year-on-year, accounting for more than half (55.1 per cent) of the total employees retiring.

The number of people leaving the LGPS in 2024/25 due to normal retirement was 40,396, an increase of 2,697 or 7.2 per cent, while the number of people leaving the LGPS due to redundancy remained low, despite an increase of 1,961 or 51.2 per cent.

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