This year, I've noticed a lot of fungi, growing on the cut ends of logs that I've sawn up. It is mostly sprouting from around the bark, rather than the wood itself.
I put this down to the excessive wet weather that we've had recently.
Some fungi are more harmful than others to the trees health but its not possible to tell this without close inspection ( A good Arbourist should be able to identify it.)
Trees that have been pollarded are some of the longest lived and willow is a very persistent and dynamic tree by its nature and is usually robust enough to cope with regular pruning, which can actually rejuvenate these trees.
I think I'de opt for managing the tree as a pollard and keep a close eye on it and bare in mind the safety of people and buildings, if that might be a problem.
I would be more concerned though, if the fungi was among the roots.