Kensington and Chelsea Council is exploring the possibility of using its pension fund to acquire temporary housing in an effort to address the growing pressure on temporary accommodation resources.
The motion was discussed at the Full Council meeting on 22 October 2025, where councillors acknowledged the increasing challenges in providing safe and decent housing for those in need. The council recognises that the shortage of available homes is making it harder and more expensive to meet its responsibilities. Currently, London Councils collectively spend £1 billion annually on temporary accommodation.
The council has welcomed the ongoing efforts to utilise pension fund monies for levelling up purposes, specifically to acquire temporary accommodation properties, as detailed in the Public Reports Pack from the Full Council meeting on 22 October 2025 [https://rbkc.moderngov.co.uk/Committees/documents/g3798/Public%20reports%20pack%2022nd-Oct-2025%2018.30%20Full%20Council.pdf?T=10]. This approach is viewed as a potentially transformative solution to a pan-London problem, offering a new financial model that could enable Kensington and Chelsea and other councils to unlock external institutional investment. This would allow them to acquire the necessary homes to address the issue.
The council expressed gratitude to the Investment Committee, particularly Cllr Quentin Marshall, Chairman of the Investment Committee, for their work in managing the fund. They were thanked for discharging their fiduciary duties and thinking creatively about how to reduce the burden on local people. Cllr Emma Will, Lead Member for Property, Parks & Leisure, was also recognised for her focus on doing what is right for the greater good.
The council currently has over 2,000 households in temporary accommodation, with approximately 18,000 social housing units available in the borough, 7,000 of which are council-owned. The council has been looking at the options available to increase the supply of housing at a greater scale to reduce those costs and to improve outcomes for residents. One proposal that is currently being progressed is for the Council's Pension Fund to acquire properties and to make a long-term arrangement with the Council for their use. The rate of Council repayments to the Pension Fund will be at a discount compared to the amount the Council would need to pay if the Council acquired the properties at Market Value via the Public Work Loan Board and its corresponding interest payment.
