Funding in the Local Government Pension Scheme (LGPS) has increased from 126% as of the end of March 2025, to a record high of 147% as of the end of September 2025, the midpoint of the 2025 valuation process.
Over the period, higher gilt yields and easing inflation reduced liability values.
Total LGPS assets exceeded £450bn for the first time, resulting in a low-risk surplus of £147bn, according to Isio’s Low-Risk Funding Index.
Of the 87 participating funds, 86 have funding levels of 100% or higher, with levels ranging from 101% to 226% funded.
At the previous actuarial valuation date, the end of March 2022, the aggregate low-risk funding position was 67% and none of the 87 funds had a funding level of 100% or higher on a low-risk basis.
The 2025 actuarial valuation potentially provides an opportunity to “reset” contribution levels and review levels of risk exposure, maintaining security within the funds while also providing value for money.
“With six months to go until the valuation is finalised, the LGPS finds itself in an even stronger position, delivering another full house of record high results,” said Steve Simkins, partner and public services leader, at Isio. “Funding levels, assets and surpluses are all higher than they have ever been.”
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