HM Treasury has published Amending Directions that allow public service pension schemes to complete the cost control element of the 2016 valuation process.
The cost cap result for the Teachers’ Pension Scheme has been calculated at 1.3% above the employer cost cap.
As this remains within the agreed ±2% corridor, the result means that no changes to benefits or member contributions will occur.
This process had previously been paused following the uncertainty from the McCloud and Sargeant judgments. These Amending Directions confirm that the McCloud remedy will be captured as a ‘member cost’ in the completion of the 2016 valuations, something which NAHT continues to fundamentally disagree with, as outlined in our responses to the numerous consultations around the rectification of the age discrimination case.
The Amending Directions instructs the Scheme on how the McCloud remedy should be considered in calculations and the assumptions when doing so.
The government is currently consulting on proposed reforms to the cost control mechanism that will be implemented in time for the 2020 valuations, which NAHT has submitted a response to.
First published 07 April 2022