Your guide to the government’s guidance on LGPS governance
Author: LAPF Investments | Published: June 29, 2026
In the first of a three-part series reviewing the government’s statutory guidance for the LGPS, we reflect on the sector’s governance requirements.
On the eve of the statutory guidance coming into force, the government has finally published its guidance on how it expects the LGPS to implement its Fit for the Future reforms.
The guidance covers the three key aspects of the new regulations – namely governance, asset pooling, and the fund’s investment strategy – it sets out its expectations on areas such as local investment, and the independent governance reviews, as well as the role of the senior LGPS officers and independent persons.
Perhaps the aspect of the reforms that has been most hotly discussed by the LGPS, and an aspect for which most of the clarification is sought (primarily because of how new the changes feel) the government’s guidance covers everything for knowledge requirements to independent governance reviews.
Training for pension committees
A key part of the new rules is the LGPS’s new knowledge and understanding requirements – with the guidance stating that anyone exercising a “delegated responsibility” on behalf of an administering authority must have a working understanding of:
- The rules of the LGPS, and
- Any document recording policy about funding, investment, administration, communications, or governance that is – for the time – being adopted in relation to the scheme
Additionally, they must have knowledge of:
- The law relating to pensions,
- Such other matters as may be prescribed in legislation and guidance
The guidance also sets out nine core areas where “appropriate knowledge and understanding should be achieved and maintained on an individual basis, namely:
- Relevant pensions legislation and guidance
- Funding strategy and actuarial methods
- Pensions administration and communications
- Pensions financial strategy, management, accounting, reporting and audit standards
- Investment objectives, strategic asset allocation, pooling, and pooling performance management
- Pension services procurement, contract management, and relationship management.
- Key skills and behaviours
Among those who need this knowledge include not just those working at the fund, but also all pension committee members. That includes elected members, employer representatives and scheme member representatives – as well as any substitute members.
On the latter, administering authorities must be able to demonstrate and explain that the individual knowledge and understanding of each pension committee member, as well as the advice available to them, enables members to properly exercise their delegated functions.
Administering authorities must also maintain a Training Strategy for the “ongoing maintenance and development” of the committee’s knowledge. It must detail how this knowledge is obtained and maintained, including how they’ll assess and address skills gaps and seek to increase knowledge.
The training strategy should detail what is expected of the committee, including:
- Committing to undertake the role for a term of office and having the capacity to attend meetings
- Understanding that roles on the committee are in a non-political capacity
- Attending and participating constructively in meetings
- Undertaking training and development appropriate to their role and individual needs
- Approaching matters with an open and independent mind, avoiding any pre-determination bias
- Having the confidence to challenge, influence and engage
- Operating within the terms of reference of the committee and the administering authority’s code of conduct
This strategy should also set out how it will ensure members of a Local Pension Board have sufficient knowledge for them to be able to understand any professional advice the board is given or shared.
In addition to this, the strategy should set out how it’ll ensure members are able to challenge any information or advice they are given, and understand how it impacts their duty to assist the administering authority.
Authorities must also have the “necessary resources in place” so that all staff, members, and all persons responsible for the management, decision-making, governance and other aspects of the delivery of the LGPS “acquire and retain” the “necessary knowledge and understanding”, with how this is delivered being set out in the training strategy.
Authorities are also required to demonstrate the governing bodies have the knowledge and understanding for governing the scheme. As for monitoring this, the administering authorities – at a bare minimum – should:
- Keep a record of the training each member of the committee and board has received each year and include this in the annual report and accounts each year
- Ensure Committee and Board papers provide a link to the training members have received on particular topics
- Take action where poor attendance of training is identified
- Undertake a training needs assessment of existing knowledge and understanding to assist with prioritisation of training delivery and prepare tailored training plans for roles and in line with the AA’s workplan items
- Communicate regularly with pension committee and board members encouraging them to highlight training needs on an ongoing basis
- Report training attended (or not) in the fund’s annual report and accounts each year
- Ensure the Committee Terms of Reference covers non-compliance with knowledge and understanding requirements
- Inform Committee and Board members that they must take responsibility for keeping an accurate record of their own training. This should be kept up to date and shared with the administering authority annually
- Ensure the training needs assessment and all records monitoring knowledge and understanding are available to persons carrying out an independent governance review
LGPS senior officer
The governance guidance also sets out in more detail the roles and responsibilities two new additions to every LGPS fund across England and Wales, namely the senior LGPS officer and independent person.
The LGPS senior officer is responsible for all aspects of managing the LGPS within the administering authority. This includes the day-to-day management of the administering authority across all pension functions.
Other responsibilities they hold include:
- Ensuring compliance with scheme regulations
- Responsibility for key performance indicators (KPIs) and ensuring high-quality service to scheme members
- Ensuring that draft strategies are prepared in accordance with legislation and guidance
- Responsibility for implementing strategies approved by the pension committee
- Responsibility for robust monitoring and review of employer risk, participation in the fund and importance of clear, timely communications with employers
- Ensuring that the decision-making body has access to adequate professional advice on all areas
- Ensuring that the local pension board is adequately resourced to carry out its role effectively as assisting the scheme manager
- Ensuring a training needs analysis is undertaken by those covered by the Training Strategy including committee members, and the recommendations implemented
- Ensuring that the administering authority carries out Independent Governance Reviews, and develops an action plan in response to any recommendations or findings
- Representing the interests of the LGPS fund within the local authority’s senior leadership team; working with senior stakeholders and ensuring that plans, policies, and resource allocation by the local authority’s senior leadership team take into account the requirements and duties associated with the LGPS fund
So a lot to take on.
As for how this role interacts with another key financial officer in an authority – the Section 151 officer – according the the governance guidance, ultimately the Section 151 officer will remain responsible for the proper administration of the local authority’s financial affairs, while the LGPS senior officer will have responsibility across all pension functions.
Additionally, while the government has made it clear that the role of the Section 151 officer and senior LGPS officer cannot be combined, it is “acceptable” for the LGPS senior officer to have other minor roles and responsibilities.
In its guidance, it added: “When appointing the LGPS senior officer, administering authorities should carefully consider what other roles the person may perform, in order to ensure that the officer can dedicate the overwhelming majority of their time and capacity to their LGPS responsibilities as well as ensuring this is done with the appropriate degree of independence from other local authority responsibilities.”
As for who takes on the role of a senior LGPS officer, the government expects it to be filled by a director, assistant director or head of service, or equivalent leadership at a single purpose pension authority.
On the topic of the single purpose pension authority – interestingly the government has made a clear distinction in its expectations.
So, for any fund which has a “host authority”, the Section 151 officer must be the head of paid service (and therefore the senior LGPS officer can’t be the head of paid service), however at a single purpose pension authority, the LGPS senior officer must be the head of paid service. Still with me at the back.
For clarity, the head of paid service is personally responsible for the overall managerial leadership, proper administration and staffing of the council.
Independent person
The independent person’s responsibilities, meanwhile, are to support both the LGPS senior officer and contribute to pension committees.
For the latter, they should be providing independent and professional expertise, including to support committees and scrutinise and challenge the advice they receive (similar to that of a non-executive director or professional trustee).
Their duties include:
- To support and contribute to the development of all strategies for which the pension committee is responsible
- To scrutinise any advice given to the committee, whether from the pool or any other organisation or individual
- To help monitor and assess performance against targets set in LGPS strategies, including administrative performance and the pool’s implementation of the investment strategy, and help monitor whether the collective pool oversight process is meeting the requirements of the administering authority
- To support consideration of the committee’s governance arrangements, including any action plans arising from Independent Governance Reviews
- To contribute in any other way appropriate to the authority’s LGPS functions
The government also expects these individuals have one of the following:
- A qualification from Pensions Management Institute (PMI)
- Member of, and accredited by, the Association of Professional Pension Trustees
- Significant experience of pensions
On this final point, it has said – while it’s preferable for such experience to be in the LGPS, persons such as experienced professional trustees of other pension schemes may perform the role. Interesting, these individuals are not required to be persons authorised by the FCA to provide advice or hold liabilities insurance.
As expected, the guidance also states that an individual can service as an independent person across multiple funds, but says authorities “will need to carefully consider their other roles and ensure that no conflict of interest arises”.
Interestingly, a senior LGPS officer at one administering authority is also permitted to fulfil the role of independent person at another administering authority.
Crucially though, the independent person must be one person – although an authority is allowed to procure a firm (such as a professional trustee firm) to provide an independent person.
Independent LGPS governance reviews
Finally, the LGPS governance guidance outlined the government’s expectations for independent governance reviews. This covers two types of reviews – these being the periodic reviews and the ad-hoc reviews.
First to the periodic reviews, which – the guidance says – allows for flexibility as to when these will take place to completion (including the sending of a copy to the Secretary of State), so that it can be arranged around other demands on the administering authority’s time.
This allows for the authority to carry out and complete the review at any time, as long as it’s within the period spanning 31st March 2025 and 31st March 2028 valuation dates. This flexibility continues into future valuation periods.
In addition to this, the person completing the review must prepare a report on the review and send it both to the administering authority and the Secretary of State. The authority must also publish the report as soon as practicable after receiving a copy.
As for the ad-hoc review, the LGPS governance guidance states an administering authority – when directed by the Secretary of State to conduct an ad-hoc review – has no flexibility to decide when a review takes place.
All told, the government expects a review to be commissioned within three months of the direction being given, and for the fieldwork of the review to start within six months of the direction being given.
Additionally, the Secretary of State will not direct who the administering authority should commission to conduct the review, with this remaining the responsibility of the administering authority.
As for who is carrying out the review, the guidance states it should be – unsurprisingly – a person independent of the administering authority and Secretary of State. However, the reviewer may be someone contracted by the administering authority in a non-pensions-related function.
Additionally, the company or person conducting the review could be a “distinct legal entity but may be a subsidiary of a larger corporation” which has been contracted by an administering authority for a pensions-related function.
In these cases, it is for the senior officer to consider the potential conflicts and decide if they’re successfully mitigated. This assessment should be documented and made publicly available.
In terms of what they should be reviewing, this should include – as a standard:
- Business planning and performance delivery
- Effective systems and governance and internal controls
- Pensions committee, LGPS senior officer, and leadership
- Communications with members and employers
The review should also assess whether an administering authority has policies required by all relevant legislation, regulations, and statutory guidance – including on:
- Governance strategy, structures, and policies
- Conflict of Interest policy
- Investment Strategy Statement
- Funding Strategy Statement
As part of this, the assessor should review areas like the authority’s business planning and performance, how effective systems or governance and internal controls are, and its meetings and decision-making processes, its risk management, and contract management.
Additionally, there should be a review how the authority communicates with its members and employers.
For members, the assessor should ensure all of the authority’s communications are timely, accurate, clear, concise, relevant and in plain English.
They should also assess how it promotes understanding of pension rights and responsibilities, how they are reviewing the communications – including how they are considering member feedback – and the methods they are using.
As for communications with employers, the assessor should look at whether the authority provides clear, timely, and accurate information, and how its communications support informed decision makings, and encourage engagement and feedback to improve services.
