The total membership of the LGPS grew by 197,000 (3.4%) to 5.8m members in 2018 from 5.6m in 2017. There was an increase in each category of scheme membership (contributing active members (+2.3%), deferred pensioners (+4.1%), and pensioners (3.7%).
The 4.1% (89,000) increase in deferred membership between 2017 and 2018 compares with a 10.5% (211,000) increase between 2016 and 2017. The higher level of deferred was due in part to the reporting of undecided leavers (those with the option to transfer).
The scheme held a positive cash-flow position in 2018. Contribution income increased by £2,094m and was £1,845m higher than benefit outgoings.
The total number of LGPS employers in 2018 was over 14,785 as compared with 14,019 for 2017. Further details of the scheme membership and scheme employers can be found on the membership page.
The total assets of the LGPS increased to £275bn (change of 5%) during 2018. The net investment return on these assets (after fees) as at 31 March 2018 was +4.0% compared with +19.1% in 2017. The 2018 figure reflecting more stable financial market conditions than in 2017.
LGPS assets were invested in pooled investment vehicles (54%), public equities (29%), bonds (7%), direct property (3%), other asset classes (7%). Between 2017 and 2018 there were relatively small changes in asset allocation resulting from differential market movements rather than cash flow, with pooled investment vehicles increasing in proportion as a result of the more favourable results achieved over the year and establishment of LGPS investment pools.
Further details of the LGPS asset allocation and amounts directly invested in securities; bonds, equities, property (pooled and direct), plus pooled investment vehicles (PIVs) and other investment categories have been analysed and charted and can be found on the investments page. Also the LGPS investment performance such as average returns by each asset class set against relevant market indices, and in addition, the comparison against a corporate peer group can also be found here.
The Scheme Advisory Board produced a separate summary and key messages report of the 2016 triennial valuation results and have collated the 2010 and 2013 triennial valuation results for comparison. The most recent LGPS funding level for the accounting year to 31st March 2018 was 85% (2016 valuation).
Due to the timing of the annual reports and valuations, the 2016 valuation results are available (as of April 2018) and are included on these pages for reference. The 2016 valuation results were used to set contribution rates from 1st April 2017 to 31st March 2020. As at 31st March 2016, the total asset value of the Scheme was £216 billion, compared with £181 billion as at 31st March 2013. The liabilities totaled £254 billion in aggregate, and the overall funding level was around 85%. The next full triennial valuation will be in 2019 based on the scheme membership and value of assets as at 31st March 2019.
As part of the 2019 valuation process, LGPS funds will revisit both their funding and investment strategies to ensure that these strategies together leave them appropriately placed to meet their long-term pension obligations as they fall due.
During the year, the Scheme Advisory Board has continued to develop and populate its website with news items, meeting papers and minutes, scheme guidance and other publications. Each fund has a statutory communications policy statement and the majority of funds have developed websites for the new 2014 scheme with online access for scheme members and potential scheme members, in addition to the national www.lgpsmember.org website. Hard copies of all scheme information are accessible from all of these websites.
Further information and next steps
The individual underlying annual reports and audited financial statements of each individual LGPS pension fund in England and Wales for the financial year ending 31st March 2018 (31st March 2017, 31st March 2016, 31st March 2015, 31st March 2014 and 31st March 2013) can be found in one place on this website.
The most recent triennial actuarial valuation reports of individual LGPS funds in England & Wales are as at the 31st March 2016 can also be found in one place on this website. Once available 31st March 2019 triennial valuations reports will be put on this website.
Going forward we intend to develop these two key information archives and continue to improve and develop this content and value to stakeholders of the overall scheme annual report each year.