Published: March 19, 2026
The fiduciary duty is the guiding principle of pension investment. It ensures that all pension investment activity is intended to meet the needs of scheme beneficiaries, including the 7 million scheme members of the LGPS. When amendments were tabled to the Pension Schemes Bill late last year, first in the House of the Commons and later in the House of Lords, that would have amended the fiduciary duty, LGPS Central Limited took a pro-active role in discussions with Government and Parliament.
Those tabling the amendments argued that some occupational pension schemes, particularly smaller schemes, do not understand that the fiduciary duty allows trustees and others governing pension funds to invest in a responsible and sustainable manner and so an amendment is necessary. We explained to Government and Members of Parliament that we believe the fiduciary duty plays a key role in protecting scheme members and sponsoring employers from poor investment outcomes and that it does not prevent the LGPS from investing in line with the Responsible Investment wishes of our Partner Funds. We ensure Responsible Investment considerations are incorporated into all our investment activity and we fully take part in appropriate Stewardship discussions.
In our view, amending the fiduciary duty in the way proposed would simply confuse and slow down effective investment activity – and runs the risk of poorer investment outcomes. We were pleased, therefore, when the Minister for Pensions decided not to adopt the amendments and instead committed to producing statutory guidance. In light of the experience LGPS Central Limited has in both abiding by the fiduciary duty and incorporating Responsible Investment considerations, we were very pleased that Patrick O’Hara, Head of Responsible Investment at LGPS Central Limited, has been appointed by the Department of Work and Pensions to the recently established advisory panel that will help them draft the promised guidance. We believe his substantial experience of ensuring our investments meet the Responsible Investment objectives of our local authority Partner Funds should ensure the guidance is clear, usable and effective.
LGPS Central Limited has been closely monitoring the passage of the Pension Schemes Bill over the last year as it passes through Parliament and has engaged with the Government and Parliament whenever we see issues that might be to the detriment of scheme members or the effective implementation of the Fit for the Future reforms.
