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Independent schools and the teachers' pension scheme – additional option for withdrawal

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​From August 2021, independent schools will be allowed to choose to phase out their participation in the teachers' pension scheme England and Wales (TPS), following the implementation of new regulations.

On Wednesday, the Department for Education published a consultation in relation to a change of regulations which included details of how independent schools in England and Wales will be allowed to withdraw from participation in the teachers' pension scheme for future employees while allowing existing staff to remain as active members.

This follows a consultation published in November where the government sought a solution to the increased rate of independent schools leaving the TPS.   Independent schools, unlike maintained schools or academies, are not required to participate in the TPS and such are able, following consultation with staff, to cease participation for all staff in the TPS (before this proposed change to allow phased withdrawal from the TPS, independent schools either had to remain in the TPS for all staff or completely exit). This new approach creates a 'mixed economy' model for those schools that choose to take it.

While NAHT recognises the difficulties that some members in independent schools may face in relation to provision of the TPS when considering this from a management perspective given the cost to the employer of membership, we remain of the view that continued membership of the TPS for all staff is the best option. NAHT does not support any measures that reduce the rights of members; membership of the TPS is a major part of a teacher's remuneration.

In our view, not offering this could have long-term consequences for the retention and recruitment of quality staff.  While this 'mixed economy' model is preferable to the entire school exiting the TPS, it is not without complications as it creates a two-tier workforce in terms of benefits and will be a barrier to recruitment, as well as further eroding the principles of the TPS. On this basis, NAHT remains convinced that full membership of the TPS for those in the independent sector is preferable.

We would encourage any members who's pension provision is affected by these changes to contact NAHT. 

First published 09 April 2021