Board statement following release of statutory guidance supporting ‘Fit for the Future’

The Scheme Advisory Board welcomes the publication of the “Fit for the Future” statutory guidance documents made under the Pension Schemes Act 2026 and the associated changes to the LGPS regulations which take effect from 30 June 2026.

The guidance provides the much needed clarity that administering authorities (AAs) have been waiting for to implement this significant package of reforms. In particular, the Board welcomes the continued focus on governance, reflecting many of the principles set out in its 2021 Good Governance recommendations.

The guidance explains how the Government expects the new Independent Person and Senior LGPS Officer roles to operate, both independently and in partnership. These new roles represent a significant development in governance, and the Board recognises the efforts funds are making to get these roles in place.

At the same time, funds will need to review and develop a range of policies and processes to meet the new requirements. The governance guidance sets out the requirements for the new Independent Governance Review (IGR). The Board recognises that there will be significant interest across the LGPS community in understanding how the first IGRs will operate in practice, including emerging approaches to implementation. To support this, we are currently exploring the development of a dedicated event that would provide an opportunity to share insights and facilitate discussion on how AA’s can effectively approach their first IGR.

The requirement for administering authorities to maintain an Administration Strategy is a welcome development which recognises the importance of pensions administration in delivering good outcomes for members and employers. The Board looks forward to further guidance to support funds in developing and implementing these strategies.

The publication of pooling guidance is also a significant milestone, providing funds with an overdue framework for implementing the Government’s chosen asset pooling model. The Board recognises that there were different views as to whether this was the right model and that implementation has presented challenges for some funds. However, now that this has been set out in legislation the task before us is to make it work as well as possible. And there is still much of the detail to be fleshed out, particularly around oversight and governance, which the Board intends to support funds and pools in achieving successful outcomes.

The updated guidance on Investment Strategy Statements (ISSs) is particularly important as funds prepare to update their statements ahead of the March 2027 deadline.

We recognise that while this is not the timetable the Board would have preferred, the final guidance represents a significant improvement in both content and clarity compared with the versions consulted on over the Christmas period.

The Board has worked extensively throughout the development of the regulations and guidance to ensure that MHCLG officials understood the opportunities and practical challenges these reforms present, We are pleased that officials have remained open to engagement and feedback from the sector and believe this collaborative approach has contributed to improvements in the guidance. We will continue to monitor implementation closely and are ready to provide additional support for AAs. We are already considering what additional guidance, events and support may be helpful in navigating these changes. Please do get in touch with the secretariat team if you have any suggestions.

Yours Sincerely,

Cllr Roger Phillips, Chair of the Board and Clair Alcock, Board Secretary and Head of Pensions, LGA