Latest News

PUBLIC SECTOR PENSION SCHEMES – GOVERNMENT RESPONSE

HM Treasury

1 Horse Guards Road

London

SW1A 2HQ                                                                                           19th February 2021

 

BY EMAIL ONLY

 

PUBLIC SECTOR PENSION SCHEMES – GOVERNMENT RESPONSE

 

I write on behalf of The National Association of Retired Police Officers [NARPO] in relation to the

Government response to the consultation on Public Sector Pension schemes as a result of the McCloud

and Sargeant cases.

Whilst we generally welcome the Government’s decision to implement the Deferred Choice Underpin option and are pleased that as a result retired members of schemes will be given the same choice as those still serving, the response indicates that retired officers will not be able to make that choice until Legislation is introduced and that choice will be delayed up to October 2023.

This in our view is clearly unacceptable; it means that as a consequence retired members will have to wait over another two years and live on a pension that is lower than it should now be because of the discrimination already identified.

Government intends to give those who retire prior to October 2023 the option of which scheme to take their benefits from, yet those already retired will not be given that opportunity, which appears unfair and could potentially case further unfavourable treatment on the grounds of age. The Government intend to resolve Immediate Detriment cases as soon as they occur but do not intend to deal with those suffering an ongoing Detriment until a much later point in time.

This in our view is quite frankly unacceptable, and we cannot see any logical reason why those already retired cannot have their cases dealt with as soon as practicable without having to wait until 2023.

The Government have decided on the remedy, and there is no reason why retired officers should continue to be discriminated against by delaying the implementation of that remedy.

We are very disappointed at this aspect of the proposed solution particularly as the initial consultation indicated that those already retired would be prioritised within the remedy.

By delaying implementing the remedy for retired officers this also creates and stores up a further potential problem for those who in the meantime unfortunately die or divorce before the implementation date in 2023, and it also means that those who retired on an ill health pension in the reformed scheme should by default not have their ill health pension reviewed until such time as they can make their choice of legacy or reformed scheme benefits.

Those who have retired on an ill health pension are being treated less favourably than those who retire in the meantime and in our view this could amount to less favourable treatment because of their disability.

The Executive Summary of the consultation document included:

Under either approach, those who have already retired and/or received a pension award will be asked to make their choice as soon as practicable after the changes are implemented. The position they choose would be applied retrospectively back to the date the award was made.

The Government response document includes in the executive Summary:

In the meantime, members will be deemed to have accrued benefits in their legacy schemes, rather

than reformed schemes, for the remedy period, until they make that choice.

Does this apply to all scheme members including retired members? If not, then why not? If it does apply to them, then all retired officers should be given the choice immediately and not at some future point in 2023.

The response also includes:

2.99 The majority of members in scope of this consultation will not retire until after the DCU is implemented and will be given their choice at the point of retirement, as detailed above. However, the government recognises that significant numbers of members have already retired and received pension benefits in respect of relevant periods service or will do so between now and the introduction of the

DCU by October 2023.

2.100 As set out in the consultation, the government accepts that members who moved to the reformed pension schemes on or after 1 April 2015 and have subsequently retired, already have an entitlement

to be treated as a member of their legacy scheme for the remedy period if they wish. In recognition of

this, the government will work with schemes to develop processes to give effect to this entitlement for those who retire before the introduction of the DCU. Where possible, schemes will also seek to offer reformed scheme members in this position who retire before October 2023 a choice of legacy or reformed scheme benefits for the relevant period at retirement. Once the complex issues described in paragraphs A.8 to A.12 have been resolved, schemes will also seek to revisit cases of reformed scheme members who have already retired ahead of the introduction of the DCU, where, and to the extent, this is possible. This process will be administratively complex and individual schemes will set out their plans for beginning to process such cases in due course.

This proposal in our view treats those retiring as from today more favourably than those already retired, and gives them the choice of higher pension payments, whilst those already retired will have their

choice delayed until some future date possibly as far as October 2023 and beyond.

We do not accept that the calculations required for those already retired are significantly more complex than those required for those retiring from today and ask that you reconsider your proposals for resolving the continuing discrimination being suffered by retired officers.

I look forward to your earliest response on this matter.

Yours sincerely

Chief Executive

 

 

 

Images Click for a larger version