The Hammersmith and Fulham Pension Fund has achieved a significant milestone, reaching a funding level of 113% as of March 2025, a notable increase from 105% in 2022. This strong performance was primarily driven by robust investment returns over the period, with equities performing particularly well. The fund has delivered performance in excess of the 2022 discount rate over the three-year period.
The latest triennial actuarial valuation, presented to the Pension Fund Committee on Tuesday, March 17, 2026, revealed the improved financial health of the fund. The valuation also indicated two key changes in actuarial assumptions: an increase in the discount rate to 5.3% from 4.6%, and an increase in the prudence level to 83% from 67%. This significant change in prudence level reflects current market conditions and suggests a more cautious approach to future return expectations.
Councillor Ross Melton, Chair of the Pension Fund Committee, commented on the positive results, highlighting the fund's strong position. The report also detailed a reduction in the Council's primary contribution rate to 19.4% due to the improved funding level. This reduced rate will be effective from 1 April 2026. The Funding Strategy Statement, which outlines the fund's objectives, is effective from the same date and is expected to remain in force until 31 March 2029, unless an interim review is conducted sooner.
The long-term goals for the Hammersmith and Fulham Pension Fund, as outlined in the Funding Strategy Statement (Item 2 - Appendix 1 Draft LBHF FSS 2025), include taking a prudent long-term view for solvency, employing a balanced investment strategy for cost efficiency, and ensuring stable employer contribution rates where appropriate. The primary objective is to secure the regulatory requirement for long-term solvency, ensuring sufficient funds are available to pay benefits to members and their dependants.
Further details on the fund's performance and administration can be found in the Public reports pack for the Pension Fund Committee meeting on 17 March 2026 (Public reports pack 17th-Mar-2026 19.00 Pension Fund Committee).
