Public Sector Pension Reform In Trouble?

hugheskevi

I think Hyubh was referring to whether Government could simply remove protection retrospectively back to 2015, ie, that protection would never have been offered for anyone.

Future accrual can be changed, subject to consultation.

From 2022 the only active members still accruing pension in pre 2015 schemes (disregarding the McCloud remedy) will be over Normal Pension age anyway.

nigelbb

CruisingSaver wrote: »

But what about those staff who've retired since 2015? I don't know what the answer is going to be but it's an interesting situation.

What about those taking their pension in a few of years? I only have a year in the old 2008 NHS final salary scheme but was switched to the 2015 scheme even though I was near state pension age because the other qualifying element for staying on the 2008 scheme was that you had been paying for your pension in 2012. As it turns out I am better off under the new scheme as the accrual rate is higher & I don't want to be switched back to the old scheme.

CruisingSaver

nigelbb wrote: »

What about those taking their pension in a few of years? I only have a year in the old 2008 NHS final salary scheme but was switched to the 2015 scheme even though I was near state pension age because the other qualifying element for staying on the 2008 scheme was that you had been paying for your pension in 2012. As it turns out I am better off under the new scheme as the accrual rate is higher & I don't want to be switched back to the old scheme.

There are a lot of 'what ifs' which makes it difficult to even guess what the remedy may be.

Golactico

It's been quiet on the McCloud remedy front for a while. However, a leaflet enclosed with my CS pension statement today suggests that the Government (through HM Treasury) will be going out to consultation on their remedy proposals in 'early summer', so this could be imminent.

davidr1964

The pension folks where I work were saying a few weeks ago that a resolution may still be years off.

drummersdale

I’m not sure that remedies potentially giving rise to additional pension costs to the Treasury will be uppermost on the list of this Governments “things to do” unless Rishi just asks the Royal Mint to whack a few more reams in the printer. It’s not like anyone would notice at the moment 

hugheskevi

A Consultation document was published today (see this link)

There is also a Written Ministerial Statement (16th July, Steve Barclay).

Key points:

• There are two possible mechanisms: an immediate choice exercise or a deferred choice underpin. Both will enable all affected members, whether they originally received transitional protection or not, to decide whether to take the legacy or reformed scheme benefits for the period 1 April 2015 to 31 March 2022.
• These proposals apply to all members who were in a relevant public service pension scheme on or before 31 March 2012 and remained in a relevant pension scheme on or after 1 April 2015.
• From 1 April 2022, all members who are not already in the reformed schemes and who are still accruing benefits in legacy schemes will be placed into the 2015 reformed pension schemes.
• the government is today announcing that the pause of the cost control mechanism, which was implemented in 2019, will be lifted.

• When the (cost control) mechanism was established, it was agreed that it would consider ‘member costs’: i.e. costs that affect the value of schemes to members. As the proposals in the consultation published today will increase the value of schemes to members, this falls into the ‘member cost’ category. As a ‘member cost’, this will be considered as part of the completion of the cost control element of the 2016 valuations process.
  

• The government will also proceed with the previously announced review by the Government Actuary as to whether the mechanism is working in line with original objectives.

nigelbb

I'm one of those affected as I was in the NHS 2008 scheme briefly as I started working in the NHS in 2014 at age 60 & was moved to the new NHS 2015 scheme in the following year. Even though I was near retirement I didn't get the option of staying in the 2008 scheme as I wasn't in the pension scheme in 2010 which was the qualifying date for protection. I've just claimed my pension & should start receiving it in the next month or two. I think that I am actually better off in the 2015 scheme but hopefully at some future date I will be offered projections on both options so I can make an informed choice.

hugheskevi

nigelbb said:

I'm one of those affected as I was in the NHS 2008 scheme briefly as I started working in the NHS in 2014 at age 60 & was moved to the new NHS 2015 scheme in the following year. Even though I was near retirement I didn't get the option of staying in the 2008 scheme as I wasn't in the pension scheme in 2010 which was the qualifying date for protection. I've just claimed my pension & should start receiving it in the next month or two. I think that I am actually better off in the 2015 scheme but hopefully at some future date I will be offered projections on both options so I can make an informed choice.

2012 was the qualifying date for protection. Based on the above, I do not think you are affected, as the criteria is (my bolding):

• These proposals apply to all members who were in a relevant public service pension scheme on or before 31 March 2012 and remained in a relevant pension scheme on or after 1 April 2015.

GunJack

I'm sooo glad all my preserved pension is in Classic....nice, easy and straightforward. I  don't envy anyone affected by this, it's going to take many years to get sorted...