Will the Fire Service Pension Issue...

FIRSTTIMER

have any impact on current other civil service pensions (TPS/Alpha etc) in career average?

Thoughts

hugheskevi

Will the Fire Service Pension Issue have any impact on current other civil service pensions (TPS/Alpha etc) in career average?

Yes. See Written Statement:

In December 2018, the Court of Appeal ruled that the ‘transitional protection’ offered to some members as part of the reforms amounts to unlawful discrimination.

Clearly transitional protection discriminates on age, that is not in dispute. The issue is whether the age discrimination was a legitimate aim and if so, whether it was applied in a proportionate way.

The Court of Appeal ruled in both the judges and firefighters scheme that offering transitional protection was not a legitimate aim. The Government's argument that it was a legitimate aim was not helped by the finding of the 2011 Hutton Report (which laid the foundation for the 2015 pension reforms) that:

The Commission’s expectation is that existing members who are currently in their 50s should, by and large, experience fairly limited change to the benefit which they would otherwise have expected to accrue by the time they reach their current scheme NPA. This would particularly be the case if the final salary link is protected for past service, as the Commission recommends. This limitation of impact will also extend to people below age 50, proportionate to the length of time before they reach their NPA. Therefore special protections for members over a certain age should not be necessary. Age discrimination legislation also means that it is not possible in practice to provide protection from change for members who are already above a certain age

Unless it can be demonstrated in other schemes that the age discrimination was a legitimate aim, the same arguments that apply to the judges and firefighters scheme apply to all schemes.

m_c_s

It is likely that either the Alpha or other CARE scheme will have to be rolled back to 2015 to maintain those on the old scheme or the Government will have to compensate all those affected by adjusting the existing Alpha or other CARE scheme to ensure that it is comparable to the older scheme and no loss has occurred - both financially and anything related to the new Alpha\CARE plan retirement age vs the old scheme.
It will cost a lot but that doesn't matter since the Government has unlawfully made the changes. It is going to be quite complex especially if it is an adjustment rather than a complete roll back. Tax years, allowances, old salary payments etc etc!!!!

FIRSTTIMER

Oh wow, that reads as though new entrants may have some form of enhancement comparable to the old final scheme ?

MancJonny

Sounds like this could be good news for people in the Alpha scheme. I really do hope so.

Still working, I am fortunate to be in ye olde civil service Classic scheme and am saddened to note the deterioration of terms & conditions from that scheme to Alpha - though, admittedly, Alpha is better than anything the private sector can offer.

My PCS union rep made mention of this very matter the other day at work. So the union is waiting to gauge the outcome of he FBU dispute and then act accordingly.

Good news, I hope, for my younger colleagues!

FIRSTTIMER

I got an email update and rang up about it and the call centre basically had a script saying that any unfunded civil service pensions (nhs/police, tps etc) are potentially going to increase something favourably for anyone in any of the career average schemes, but that will take months to years to fix.

hyubh

MancJonny wrote: »

Sounds like this could be good news for people in the Alpha scheme. I really do hope so.

Still working, I am fortunate to be in ye olde civil service Classic scheme and am saddened to note the deterioration of terms & conditions from that scheme to Alpha - though, admittedly, Alpha is better than anything the private sector can offer.

Whether Alpha is worse or not very much depends on individual circumstance - in particular, the accrual rate is way, way better than Classic's.

MancJonny

hyubh wrote: »

Whether Alpha is worse or not very much depends on individual circumstance - in particular, the accrual rate is way, way better than Classic's.

Point taken, hyubh.

I was assuming that HMG would not replace one pension scheme (Classic) with a MORE generous one (Alpha), and minus a tax-free Lump Sum to boot.

Silvertabby

Similar to the LGPS switch from Final Salary to CARE.

Those who only have a couple of promotions during their careers are likely to be much better off on CARE (1/49th) than FS (1/60th).

m_c_s

Alpha is a great scheme with an excellent accrual rate but that is offset by higher contributions and most significantly a large increase in Normal Pension Age.
Some initial indications are that the Government will offer compensation rather than a roll back to the old schemes. This makes sense because new starters after 2015 are not really affected and the Government still wants to align these CARE pensions with the SP age rather than the old 60 yrs old like Classic. They can then change the SP as they see fit and this will flow easily through to all CARE pensions schemes that have the link.