Twenty-one local government pension scheme (LGPS) funds, representing around £108.7bn (€124bn) in assets in the UK, have found new homes across four investment pools this year, as the sector moves towards a government-mandated reduction in the number of pools from eight to six.
The moves follow the UK government’s decision in April to reject proposals from ACCESS and Brunel Pension Partnership to meet new minimum pooling standards. As a result, affected funds were required to join alternative pools ahead of the 30 September deadline.
Local Pensions Partnership Investments (LPPI) has expanded to nine member funds after Devon, Avon, Dorset, Somerset, Cornwall and the Environment Agency Pension Fund signed a memorandum of understanding in November. Once integration is complete, LPPI’s assets under management will exceed £54bn.
The new entrants join Lancashire County Pension Fund, the London Pensions Fund Authority and the Royal County of Berkshire Pension Fund. LPPI currently manages £26.5bn across six pension funds and two pooled authorised contractual schemes on a fully delegated basis for Greater London, Lancashire and the Royal County of Berkshire.
LGPS Central
LGPS Central has added six new partner funds – Gloucestershire, Hampshire, Norfolk, Oxfordshire, Suffolk and Wiltshire – increasing its scale ahead of the government’s 2026 consolidation deadline.
They will join existing partners Cheshire, Derbyshire, Leicestershire, Nottinghamshire, Shropshire, Staffordshire, West Midlands and Worcestershire pension funds. Together, the partnership currently represents around £68bn in assets on behalf of more than one million members.
Following the additions, LGPS Central’s total managed assets are expected to rise to around £100bn, covering nearly 5,000 employers and more than 1.6 million members.
Border to Coast
Border to Coast Pensions Partnership has confirmed seven new partner funds – Cambridgeshire, East Sussex, Essex, Hertfordshire, Kent, Northamptonshire and West Sussex – adding around £45bn in assets and approximately 900,000 members.
They will join the existing 11 partner funds, bringing total assets to about £110bn, covering roughly two million members employed by more than 5,000 participating employers.
London CIV
London CIV has added Buckinghamshire Pension Fund, bringing an additional £4.2bn into the pool and lifting total assets under management to around £55bn.
The pools must formally admit the candidate funds by 31 March 2026 to meet the government’s consolidation deadline, which will reduce the number of LGPS pools to six.
More consolidation ahead?
Speaking at the Pensions UK conference in October, pensions minister Torsten Bell ruled out further forced consolidation within the LGPS. However, industry participants remain sceptical as pools continue to pursue greater scale.
Richard Law-Deeks, chief executive officer of LGPS Central, said further rationalisation is likely to occur voluntarily over time.
He said: “While no more forced consolidation is expected in the LGPS world, over time there will be less pools, less funds and potentially less employers – but more scale.”
Law-Deeks added: “When someone retires, or people are collaborating so much they realise they may as well merge, it will come from people wanting to do it. I do believe [the pensions minister] when he said there’s going to be no more compulsion. I think it will be driven by a sense of purpose as opposed to policy or stress.”
Paul Myles, head of LGPS at Schroders, said expectations of further change remain widespread, with fund mergers now a central issue for many pension funds.
A Schroders survey of 82 senior LGPS professionals conducted in November found that 83% expect further government-driven consolidation after March 2026. Of these, 49% anticipate pressure to merge pension funds rather than pools, while 34% expect further pool consolidation.
Tiffany Tsang, head of DB, LGPS and investment at Pensions UK, said consolidation is likely to continue as schemes seek scale, but warned the process will be “uneven” and play out over the “long term”.
She noted that local government reform and governance complexity at fund level will need careful handling, and stressed that mergers remain voluntary, requiring sufficient time for fiduciary decisions and asset transitions.
Tsang added that any proposed powers to force pooling or mergers under the Pension Schemes Bill should be used only as a last resort, following dialogue and with strong safeguards to protect members and governance.
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