McCloud and Ill health retirement

MrsBrooks13

Hi I’m looking for some general advice regarding the published McCloud remedy please, specifically relating to Ill Health Retirement applications. 

Some background: I’ve suffered chronic, incurable but not life threatening ill health for five years. In that period, I’ve had numerous sick absences of between a couple of weeks and several months but always managed to eventually return to work. I’ve had OH referrals and subsequent reasonable adjustments but continue to experience problems which are continually preventing me from effectively doing my job. I am now signed off work again. Attendance management procedures are looming ....
My GP suggested IHR a year ago but in the meantime prescribed a new treatment which initially improved matters. However, as with previous treatments the benefit was short lived and the side effects caused were both unpleasant and affected my concentration and focus.  I also underwent a new physical therapy which started to improve things but was then cancelled due to COVID pressures on NHS. In the interim period my condition has deteriorated further and the physical therapy is now unlikely to improve matters. I am awaiting an appointment with my consultant but again this is delayed due to COVID. 

My GP has again suggested an IHR application but I’ve always been under the impression it’s better for your employer to instigate this rather than request it. However, in light of the McCloud remedy being available until 31 March 2022 and the ability to choose between staying in Alpha or reverting to Classic, I’m unsure whether to wait or make an application now. I know these things take time to sort out...

My specific question is : if I applied for IHR, would the application have to be before 31 March 2022 to be assessed on Classic terms i.e. incapable of doing my own job (a professional one in which I have over 25 years experience but reckonable service is 18) before I reach age 60? Prior to McCloud I understand I could only be assessed on Alpha terms i.e. incapable of doing any job before age 67 in which case I’d probably only satisfy the lower tier benefits. So I presume as the Classic terms are easier to satisfy, this would be the better scheme for me to choose IF I had the option?
I’d be grateful for any advice on this plus anything else I should consider which hasn’t yet occurred to me (probably a lot!)
Thanks very much 

hugheskevi

MrsBrooks13 said:

My GP has again suggested an IHR application but I’ve always been under the impression it’s better for your employer to instigate this rather than request it. 

Makes no difference from a pension perspective - either you meet the ill-health criteria or you don't, how you arrived at the medical assessment does not have any relevance.

My specific question is : if I applied for IHR, would the application have to be before 31 March 2022 to be assessed on Classic terms i.e. incapable of doing my own job (a professional one in which I have over 25 years experience but reckonable service is 18) before I reach age 60?

From 1 April 2022 you will be in the alpha scheme only. So if you apply on or after that date you will be assessed under alpha ill-health terms.

So I presume as the Classic terms are easier to satisfy, this would be the better scheme for me to choose IF I had the option?

Classic is easier to satisfy than alpha, but only has one tier of ill-health, so if you were assessed as being incapable of any job alpha may be preferable. If you apply before 1 April 2022 you would be assessed against both classic and alpha and your benefits calculated based on the results to present you with pension options under classic or alpha for the remedy period.

MrsBrooks13

Thank you for taking the time to explain hugheskevi. That’s very helpful. As ever, your contributions on here (along with many others) are always invaluable and I’ve learned a lot from reading your collective posts since joining the forum a couple of years ago. I wanted to establish whether the IHR application had to be made before 1 April 2022 or whether the IHR process had to be complete and granted by then and you’ve answered that for me. 😊

hugheskevi said:

Classic is easier to satisfy than alpha, but only has one tier of ill-health, so if you were assessed as being incapable of any job alpha may be preferable. If you apply before 1 April 2022 you would be assessed against both classic and alpha and your benefits calculated based on the results to present you with pension options under classic or alpha for the remedy period.

In all honesty I don’t believe I’d meet the upper tier of Alpha as it seems very strict, plus it almost doubles the ‘permanence’ time in which I would be required to work. So my inclination is to go for Classic while there’s this one-off opportunity, especially as I have my GP’s backing.

Financially I think it would be beneficial to hold out as long as I possibly can (if health allows) as not only am I lacking a few years NI contributions to eventually get maximum State Pension, a not-insignificant general pay rise secured as part of a previously agreed multi-year pay deal is looming. So if I am assessed on Classic terms it would increase my lump sum payable on retirement by a few thousand. I have a a few months sick pay remaining (if required) plus a full quota of annual leave so could potentially hold off applying until the pay rise is effective. Or am I wrong in thinking this?
 Thanks

hugheskevi

In all honesty I don’t believe I’d meet the upper tier of Alpha as it seems very strict, plus it almost doubles the ‘permanence’ time in which I would be required to work. So my inclination is to go for Classic while there’s this one-off opportunity, especially as I have my GP’s backing.

If you apply prior to 1 April 2022 you do not choose which medical assessment (alpha or classic) you take - you will be assessed under both.

so could potentially hold off applying until the pay rise is effective.

Classic pension is based on salary over last 12 months, so it takes a year at the higher salary for classic final pay to fully reflect the higher salary.

MrsBrooks13

Thanks again hugheskevi. I didn't realise either of those points. Both beyond my control then. But who 'chooses' which scheme you are retired under - the employer or the SMA? And what criteria is used to inform that choice? Or could you point me in the right direction to find out - conscious I'm taking up your time here.

poorchester

Just to give you an idea of potential time scales, I left Civil Service on IHR (classic) a couple of years ago. From application to release took approximately 15 months and mine was quite a straight forward case - basically a letter from my consultant and a telephone ‘consultation’ with OH.

hugheskevi

MrsBrooks13 said:

But who 'chooses' which scheme you are retired under - the employer or the SMA? 

Neither, you do
You will be assessed by the SMA under both schemes, and then (due to McCloud) given a choice of scheme from which you want to take benefits.
Note - this will take a while for the scheme to put in place, so if you are assessed in the coming months you may initially only be able to be assessed under alpha and the assessment under classic would be retrospective when your pension is remedied.

MrsBrooks13 said:

Or could you point me in the right direction to find out 

As this is all so tied up with McCloud there is only really the points in the HM Treasury Consultation Response at the current time to go on. Everything you will read about will be about being assessed under alpha.

MrsBrooks13

Hugheskevi - enlightening and useful as ever. Thanks again. Thanks too Poorchester, that's a useful benchmark. Seems an awfully long time for a phone call and a letter though! I didn't imagine it would take as long as that! I assume a reversion to Classic would also include an enhancement up to a maximum of 6 yrs 8 months?

hugheskevi

MrsBrooks13 said:

! I assume a reversion to Classic would also include an enhancement up to a maximum of 6 yrs 8 months?

Yep, just standard Classic rules, nothing unusual.

Trying_to_be_good

A quick amendment - in Classic “Your final pensionable earnings will be the best consecutive 12 months’ pensionable earnings in your last three years of reckonable service.”, not the final 12 months.
IHR takes months (even before the pandemic) so you may not be able to exit on IHR before 31 March 2022 in any case, but being dismissed before then and then the IHR process completing may be an unconventional way of making it happen.

Tromking

I was dismissed due to ill health in October 2019 and chose not to apply for ILR under the Alpha scheme as I felt I would not have reached the threshold required. On reading the Government’s proposed remedy for the discrimination I now feel that I would’ve met the criteria for IHR had I been dismissed under the rules of my legacy scheme of Classic. 
I believe this is covered under the ‘Contingent Decisions’ part of the proposed remedy. Anyone know who I raise this issue with, is it my old workplace I contact or the scheme administrators direct?