Pools and governance
Sections 1 to 8 of the Pension Schemes Act 2026 contain the core legislative provisions identified in the government's May 2025 response to its local government pension scheme (LGPS) 'fit for the future' consultation.
They provide for and confer regulation-making powers in connection with asset pools/asset pool companies, governance reviews, and investment strategy and co-operation with strategic authorities. They also modify the effect of part of the Procurement Act 2023 for pools.
Why this is important
The reforms will have a significant impact on administering authorities and LGPS pools.
Current position and projected timescales
The Pension Schemes Act received Royal Assent on 29 April 2026. Sections 1 to 8 will come into force on a date to be set by regulations and, in November 2025, the Ministry of Housing, Communities and Local Government (MHCLG) opened a consultation on two sets of draft regulations to implement the 'Fit for the Future' proposals.
The consultation paper explained that the first set of regulations (The LGPS (Pooling, Management and Investment of Funds) Regulations 2026) would implement the pooling and local investment proposals and replace the LGPS (Management and Investment of Funds) Regulations 2016. They would be supported by revised investment strategy statement guidance and new asset pooling guidance.
The second set of regulations (The LGPS (Amendment) Regulations 2026) would implement the governance proposals, making changes to the LGPS Regulations 2013. They would be supported by governance guidance covering topics such as governance strategies, independent governance reviews, appointment of independent persons and administration strategies.
On 21 May 2026, the government published the response to that consultation and the Local Government Pension Scheme (Pooling, Management and Investment of Funds) Regulations 2026 and Local Government Pension Scheme (Amendment) (Governance) Regulations 2026 were laid before Parliament.
Both sets of regulations are expected to come into force on 30 June 2026. The consultation response says that the accompanying guidance on pooling, the investment strategy statement, and fund governance will be published in time for the regulations coming into force.
The consultation response also lists a number of changes made to the regulations to take account of the feedback received and confirms that the following key milestones are set out in them:
- "A fund’s assets must be under pool management within three months of their first participation in the pool, subject to such further transitional periods as the asset pool company may agree on a case-by-case basis where it is not reasonably practicable to have assets under pool management within the three month deadline."
- "Where an administering authority is moving asset pools, they will be exempt from the requirement to only participate in one pool for a period of three months."
- "Further to the above, where an administering authority is participating in their old pool solely for the purpose of winding-down that pool, they will be exempt from the requirement to only participate in one pool until the wind-down process is complete."
- "Administering authorities must appoint an LGPS senior officer and Independent Person within 6 months from the date of the regulations coming into force".
- "The publication of the first investment strategy will be required by 31 March 2027".
You can read about the amendments made to (what are now) sections 1 to 8 of the Act as the Bill made its way through the Parliamentary process in our September 2025 public service pensions newsletter, December 2025 public service pensions newsletter, March 2026 public service pensions newsletter, and April 2026 public service pensions newsletter.
