Torsten Bell, the UK pensions minister, has ruled out further forced consolidation among Local Government Pension Schemes (LGPS), following a government directive that required 21 funds to join one of the existing six pooling arrangements by 30 September 2025.
Earlier this year, the government rejected proposals by ACCESS and Brunel Pension Partnership to meet new minimum standards for local government pension pooling, triggering the latest wave of fund reallocations.
Seven former ACCESS partner funds – Cambridgeshire, East Sussex, Essex, Hertfordshire, Kent, Northampton and West Sussex – will be joining Border to Coast Pensions Partnership, while Hampshire, Isle of Wight, Norfolk and Suffolk will move to LGPS Central.
Former Brunel partner funds have been dispersed across three pools: Gloucestershire, Oxfordshire and Wiltshire are joining LGPS Central; Avon, Cornwall, Devon, Dorset, the Environment Agency and Somerset are joining Local Pensions Partnership Investments (LPPI); and Buckinghamshire has joined London CIV.
Although the reallocation process has concluded, the pools must now complete governance and legal work to formally onboard the funds, with completion expected by 31 March 2026.
Speaking at the Pensions UK conference in Manchester on Wednesday, Bell acknowledged the scale of work involved in the process.
“There is a lot of really important work happening right now, and it’s a lot. I want to say thank you to everyone who’s engaged in that,” he said.
“This is the path we’ve been on for the last 10 years,” he added.
The minister confirmed there are “no plans” to enforce further consolidation “as things stand”, noting that LGPS funds are already set to play a “very large” role in the UK pensions landscape.
He said: “We are talking about it being a very significant pension player globally compared to lots of other systems in 15 years’ time.”
For now, he said the focus must remain on improving “quality and governance”.
Voluntary consolidation expected
Speaking separately, Richard Law-Deeks, chief executive of LGPS Central, said he expects further rationalisation to happen gradually and voluntarily rather than by mandate.
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.”
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