Pension fund boosted by £49m from strong investment returns
The Hammersmith and Fulham Pension Fund has seen its net assets increase by £49 million, primarily due to strong investment returns over the financial year ending 31 March 2026. The draft Pension Fund Statement of Accounts for the year revealed that the Fund's net assets rose to £1.462 billion.
The increase was largely driven by a significant rise in the 'Net Return on Investments', which reached £76,497,000 in 2025/26, up from £57,096,000 in the previous financial year. This strong performance was primarily fuelled by 'Profit and losses on disposal of investments and changes in value of investments', amounting to £52,707,000 in 2025/26, a substantial increase from £35,670,000 in 2024/25. Investment income also contributed positively, growing to £23,790,000 from £21,140,000.
Investment management expenses remained stable at £6.7 million, consistent with the previous financial year. The Fund's overall investment strategy, which includes a diversified portfolio of equities, bonds, property, infrastructure, private markets, and renewables, has been credited with this growth.
Siân Cogley, Pension Fund Manager, presented the draft accounts to the Pension Fund Committee, noting that the increase was broadly in line with expectations despite market fluctuations. The committee was asked to approve the draft accounts, with the final version to be delegated to the Director of Treasury and Pensions in consultation with the Chair. The draft accounts can be found in the Public reports pack 24th Jun 2026 Pension Fund Committee.
As of March 2025, the Pension Fund had a healthy funding level of 113% with a surplus of £161 million. This £49 million increase in net assets would further enhance the surplus and solvency of the Fund, although the exact updated figures for March 2026 are detailed in the full statement.
The Pension Fund navigated market fluctuations driven by heightened geopolitical risk and global conflicts
which negatively impacted developed markets, particularly the US. Additionally, wider market sentiments, moving away from traditional technology stocks, such as software more in favor of those stocks that are more either AI generative or with an AI focus
presented challenges. However, the Fund's strong diversified portfolio over the last three or four review cycles
proved to be its key source of risk reduction
and key mitigation against risk in your portfolio right now.
The strong investment returns come at a time when the Pension Fund is navigating significant reforms under the Pensions Schemes Act 2026. This legislation mandates participation in approved LGPS asset pools, with the London Collective Investment Vehicle (LCIV) designated for Hammersmith and Fulham. These reforms aim to improve consistency, accountability, and governance standards across the LGPS by separating strategic decision-making by administering authorities from operational investment implementation by asset pools.
For the Hammersmith and Fulham Pension Fund, this means the Pension Fund Committee will continue to retain responsibility for determining funding and investment strategy with greater emphasis placed on oversight, scrutiny and assurance rather than direct investment implementation.
As investment implementation responsibilities concentrate within London CIV, the Fund's role will focus on Strategic asset allocation. Monitoring investment performance. Oversight of London CIV. Monitoring investment costs and value for money. Risk management and governance. Compliance with statutory requirements.
The Fund will also need to develop new governance documents, including a Governance Strategy, Training Strategy, and Conflicts of Interest Policy.
The London CIV's role is to bring our partner funds assets together, so they are managed at scale, with stronger governance, lower fees, and access to high-quality investment opportunities.
In implementing the LGPS pooling and governance reforms, the LCIV is responsible for investment implementation, Portfolio Design and Execution, RI Implementation, and Delivery of Local Investment.
They are also expected to provide Principal SAA Advice to Partner Funds.
The LCIV has developed a Fit for the Future
plan, which was approved by the government, and has collaborated with its 33 partner funds to address key criteria including strategic asset allocation advice, investment transition and implementation, governance, and local investment.
