The Local Pension Committee of Leicestershire Council met on Friday 11 September 2026 to discuss the performance of the Pension Fund's investments, updates on regulatory changes affecting the Local Government Pension Scheme (LGPS), and the Fund's responsible investment strategy. Key decisions included noting the LGPS Central presentation, approving the Pension Fund Annual Report and Accounts for 2025/2026, subject to external audit, and approving the updated Pension Fund risk register.

LGPS Central Presentation

Representatives from LGPS Central, including Mr. Louis-Paul Hill, Mr. Toby Buscombe, and Mr. Kam Atwal, provided an update on private market investments and new services being delivered to the Fund. They explained that the full transition to LGPS Central assuming total fund management responsibilities would take approximately 24 months, with ongoing detailed planning to manage risks effectively. Legacy assets, such as the Fund's farm holding, would not be transitioned if it would negatively impact their value. The presentation also covered private equity, private credit, infrastructure, and property investments, with discussions focusing on long-term performance, diversification, and managing risks associated with leverage and default.

Valuation of Pension Fund Investments

The Committee received an update on the performance of various asset classes and the total value of the Fund's investments as of 30 June 2026. The report indicated positive returns in global investment markets during the second quarter of 2026, with global equities advancing strongly. The Committee noted this report.

Fit for the Future Update

An update was provided on the regulatory changes within the LGPS, stemming from the 'Fit for the Future' reforms. Key points included the mandatory appointment of an LGPS Senior Officer by 31 December 2026, with the Strategic Finance Manager – Investments designated as an interim Senior LGPS Officer. The appointment process for an Independent Person was also progressing, with a strong field of applicants. New governance arrangements for LGPS Central were outlined, including the establishment of an Oversight Board, Shareholders' Engagement Forum, Client Forum, and Partner Fund Officer Group.

Responsible Investment Report

The Committee received an update on the progress of the Responsible Investment (RI) Plan 2026, the Fund's quarterly voting report, and stewardship activities. It was noted that the review of the Net Zero Climate Strategy had been delayed to incorporate new Government guidance and LGPS Central's developing approach to responsible investment. Discussions covered the integration of Environmental, Social, and Governance (ESG) factors into investment processes, with a focus on financially material risks and opportunities. The report highlighted engagement activities with companies on issues such as board structure, diversity, climate risk management, and human rights.

Risk Management and Internal Controls

The Committee reviewed the Pension Fund Risk Register, which includes 19 risks categorised into six areas: Investment, Liability, Employer, Governance, Operational, and Regulatory. A new risk relating to Local Government Reorganisation (LGR) was added following Government guidance. While the announcement of a pause to LGR introduced uncertainty, the risk was currently rated amber, with plans to review it once further clarity on the timetable and implications was available. The Committee approved the updated risk register.

Pension Fund Annual Report and Accounts 2025/2026

The Committee considered the draft Annual Report and Accounts for the financial year 2025/2026. Key highlights included a Fund valuation of £7.4 billion as of 31 March 2026, an investment return of 10.5% over the past year, and a funding level of 140% as of the 31 March 2025 triennial valuation. The report noted the increasing number of scheme members and the ongoing implementation of the McCloud Remedy. The Committee approved the Annual Report and Accounts, subject to external audit.

Board Annual Report 2025/2026

The Committee noted the Annual Report of the Local Pension Board for the financial year 2025/2026. The report summarised the Board's work in overseeing the Fund's governance, administration, and compliance with regulations. It highlighted the ongoing challenge of the McCloud Remedy and preparations for the Pensions Dashboards Programme.

Date of Future Meetings

The Committee noted the dates for future meetings, with the next meeting scheduled for 4 December 2026.

The remaining agenda items, concerning detailed investment reports from various fund managers, were considered in private session due to the likely disclosure of exempt information.