Pensions - Articles - Comment on consultation on public service pension reform


Steve Simkins, Partner at Isio, responds to the government’s announcement of its consultation on public service pension reform:

 “The McCloud age-discrimination judgment certainly threw a spanner into the works of public service pension reform. Today’s announcement confirms that seven years of reform have been lost: new schemes put into place in 2015 will not now become effective until 2022.
 
 “Today’s consultation, which is all about choice, puts 3 million public service pension scheme members in doubt about what their pension benefits will be and when they will be able to decide. Choice is good but clear information and guidance is needed to make sure good decisions are made and these generous benefits are valued and understood. The difference could run into thousands of pounds of pension a year for some. In terms of who will benefit, doctors are likely to benefit the most. This could mean additional annual allowance tax bills, but adding more confusion to doctors’ pensions is unlikely to curry much political favour during a pandemic.

 "The government has estimated reform costs at £4bn a year and stated that this should be met by the members. And although the delay is designed to take away age discrimination, it is still the case that the cost of these extra benefits for older and current members will be met by younger and future members. The government is standing behind the reformed schemes, but it has also left the door open to further reform. In order for these scheme to be fair, their value should be understood and, as Lord Hutton suggested, form part of public service pay consideration overall.”
  

Back to Index


Similar News to this Story

Practical steps to support younger workers pension saving
Three quarters (74%) of employers worry employees will not save enough for retirement as living costs squeeze disposable income. A similar proportion
Two thirds use salary sacrifice but most unaware of 2029 cap
Nearly two-thirds of UK workers (62%) are using salary sacrificeA similar number (63%) are unaware it will be capped from 2029Nearly one in ten (9%)
The year of the DC Default
All DC default pension providers delivered positive returns in 2025, supported by strong performance across all major asset classes. 71% of providers

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.