The Harrow Pension Fund's funding level has fallen to 100%, a decrease from 108% recorded at the triennial valuation in March 2025. As of March 31, 2026, the fund's assets are valued at £1.15 billion, with liabilities also standing at £1.15 billion. This shift from a surplus to a 100% funding level means the fund has eliminated its previous surplus.
The Pension Board reviewed the estimated funding position for March 31, 2026, during their meeting on July 30, 2026. The decline in the funding level is primarily attributed to a decrease in the discount rate, which has consequently increased the fund's liabilities. The real discount rate has fallen from 3% to 2.4%, driven by prevailing market conditions.
While these fluctuations are considered normal due to market volatility, they highlight the importance of continuous monitoring of the fund's financial health. The report notes that a sustained deficit could trigger a review by actuaries, with an interim review potentially initiated by a drop of 10-15% in the funding level.
In comparison to other funds, Harrow's previous funding level of 108% in March 2025 was noted as one of the lower figures among London boroughs, with the average being significantly higher. However, for the March 2026 valuation, Harrow's 100% funding level is considered in line with trends across England and Wales. Analysis of 2025 triennial valuations shows the average funding level for Local Government Pension Scheme (LGPS) funds in England and Wales rose from 107% in 2022 to 122% in 2025.
The next triennial valuation for the Harrow Pension Fund is scheduled for March 31, 2028. Key factors that will be closely monitored leading up to this valuation include future investment performance, prevailing market conditions, and the agreed financial, salary, and demographic assumptions. The full details of the Pension Board's review can be found in the Public reports pack.