In June 2019 the Supreme Court refused the Government permission to appeal the Court of Appeal’s December 2018 judgment in the McCloud and Sargent cases.
The judgement found that both the judges and firefighters pension schemes were discriminatory to some of their members. This was on the grounds of age discrimination when the career average arrangement was introduced in 2015 for teachers and firefighters or 2014 for LGPS support staff and the ‘transition protection’ which was provided to some members.
Transitional protection allowed some older workers to stay in the old pension schemes, instead of being moved to the new career average schemes with higher pension ages in 2015. Those within ten years of their Normal Pension Age as at 1 April 2012 remained in their pre-2014 and pre-2015 schemes, the majority of which were final salary schemes.
On 15 July 2019 the Government announced that they accepted that the judgment applies to all the main public service pension schemes and consulted on the proposals to address the discrimination. They offered two options to remove this discrimination. Both of these provide in scope members with a choice of receiving either their old or new scheme benefits.
The Government has confirmed that this will apply to all members with relevant service in the main public service schemes, so as well as Firefighters in scope members of the Local Government Pension Scheme, Teachers’ Pension Scheme, NHS Pensions, etc. and not just judges and firefighters who have lodged legal claims. The consultation closed 11 October 2020.
Who will be affected by the change?
The changes will apply to all of the public sector pension schemes listed above and to all members who were in post on the 31 March 2012 and still in post on 1 April 2014 (LGPS) or 1 April 2015 (teachers and firefighters). The remedy period will be from 1 April 2014 to 31 March 2022 or 1 April 2015 to 31 March 2022 respectively.
What is Dataplan doing to support clients with members of these public sector schemes?
Firstly, Dataplan participated in consultations hosted by the Local Government Association (LGA) to reach agreement on a standardised approach to data collection by pension schemes, including a common set of data fields and timescales.
Secondly, where requested we will be providing details of all changes to contracted hours worked during the remedy period and all unpaid absences of 30 days or more. This is a significant amount of work for employers (and/or their payroll providers) and pension schemes alike.
Some pension schemes have asked for this information for all current and former members – without realising that they don’t actually need all of this. In reality, they only need data for members who were in post on the 31 March 2012 and still in post on 1 April 2014 (LGPS) or 1 April 2015 (teachers and firefighters).
Where this has happened, Dataplan has worked in partnership with the schemes concerned and wherever possible have agreed that they will provide us with a list of the in scope members and we will then provide them with the required data. From our experience so far, less than 20% of current members are in scope for the remedy.
Many pension schemes do not need to collect any additional data as they have already been provided with this through the monthly returns we submit on your behalf.
For more help and advice regarding your School’s pension schemes we offered a fully managed Payroll and Pensions service.