The Government Actuary’s Department (GAD) review of actuarial valuations for the Local Government Pension Scheme, England and Wales, as at 31 March 2018, found that the LGPS is in a strong financial position.
In a report issued at the end of September, the GAD said funds have made significant progress since 2013. The total assets of the LGPS grew from £180 billion to £217 billion, with the aggregate funding level up from 79% to 85%. According to the GAD report, the improved funding is due in part to significant financial contributions from LGPS employers, as well as better than expected returns on assets.
On a best estimate basis, the LGPS had an aggregate funding surplus of 106% at the end of March 2016, with around 60 out of 91 funds in surplus. The GAD said that this meant that, on average, there is a greater than 50% chance that existing assets will be sufficient to cover benefits in respect of accrued service when they fall due.