The Pensions Committee of Newham Council met on Thursday 16 July 2026 to approve the Pension Administration budget for 2026/27, finalise the onboarding of the Fund's remaining assets with the London Collective Investment Vehicle (London CIV), and approve the Pension Fund Budget and Business Plan for 2026/27. The committee also received an update on the fund's investment performance and funding position as at 31 March 2026.

Pension Administration Budget and Updates

The committee approved the 2026/27 Pension Administration budget of £1.107 million, representing a 1.58% increase from the previous year. This budget is managed by Lancashire County Council through the Local Pension Partnership Administration (LPPA) service. Updates were provided on the impact of the Pension Scheme Act 2026, which introduces new statutory requirements for the appointment of a Senior LGPS Officer and an Independent Person, as well as mandating triennial governance reviews and the development of a training strategy for elected members, board members, and officers.

Further legislative changes stemming from consultations on Access and Fairness and Access and Protections were also discussed. These include equalising survivor benefits, changes to death grant rules, and making additional unpaid maternity, adoption, and shared parental leave automatically pensionable. The Access and Protections consultation will also see the normal minimum pension age increase to 57 from 55 in April 2028, and reinstating LGPS access for councillors and mayors in England. Reforms to New Fair Deal will provide stronger protection for outsourced staff, ensuring they remain in the LGPS.

An update on employer admissions into the scheme showed progress, with 14 outstanding admission agreements as of 30 June 2026, down from 29 previously. The Local Pension Board met on 24 March 2026, receiving updates on performance data, legislative changes, and agreeing on a communication plan for 2026/27.

Business Plan and London CIV Investment Manager Agreement

The committee agreed to finalise the onboarding of the Fund's remaining assets with the London CIV by approving the Investment Manager Agreement (IMA). This agreement authorises the London CIV to manage the Fund's assets, including legacy positions and passive mandates. The London CIV, established in 2015, is one of six LGPS investment pools in England and Wales, pooling assets from 33 partner funds. As of 31 March 2026, the London CIV had £38.1 billion in Assets Under Management (AUM). The committee also approved the Draft Pension Fund Budget for 2026/27 and the Draft Pension Fund Business Plan for 2026/27, which outlines key tasks for the committee, including administration, investments, and governance.

Investment Strategy Update and Performance

The committee received a report from Barnett Waddingham LLP detailing the Fund's investment performance and funding update as at 31 March 2026. The Fund's total invested assets showed a negative return of 2.2% over the quarter, primarily due to a decline in the LCIV Global Equities Focus fund. However, the income portfolio returned 1.4% over the quarter.

The Fund's funding level remains strong, with a surplus of £60 million as at March 2026, representing a funding level of 103%, an improvement from the £39 million surplus and 102% funding level in March 2025. Key influences on the funding level include longevity risk and financial risks such as inflation and investment risk.

The report highlighted the impact of geopolitical events, including airstrikes in Iran and the closure of the Strait of Hormuz, which led to a significant surge in oil prices and increased inflation expectations. This has influenced market expectations for interest rate rises from central banks.

The committee was presented with the Fund's Strategic Asset Allocation (SAA), which is currently under review. The report detailed the Fund's investments across various asset classes, including equities, private equity, infrastructure, property, and private credit, with a focus on the transition of assets to the London CIV. The committee noted the ongoing progress in pooling assets, with 67% of assets pooled with LCIV/LGIM, and a target of 100%.

The market outlook for the next 12 to 24 months suggests a cautious approach to risky assets due to geopolitical risks and potential interest rate rises. The report also provided an outlook for private markets, noting opportunities in private equity secondaries and infrastructure, while highlighting risks in private credit due to software exposure.

The committee was asked to note the Barnett Waddingham report on the Fund's investment performance and funding update. The committee also resolved to move into an exempt session to discuss further items.