Latest Announcements

EMBARGO: Non Club Transfers and Pensions on Divorce calculations

As part of the package of changes announced in the Chancellor’s emergency budget on the 22 June 2010, the basis for revaluing pension increases in public sector pension schemes is to change from the Retail Prices Index to the Consumer Prices Index.  This will affect the indexation of future benefits in deferment and in payment, with a consequent potential impact on cash equivalent transfer values (CETVs).

Following instruction from the scheme managers, the Department for Education (DfE), all CETV calculations regarding Pensions on Divorce and all Non-Club (non public sector) transfers into and out of the TPS have been suspended, pending further instruction.  The DfE are consulting with HM Treasury, the Scheme Actuary and other offices across government, with a view to a further announcement on the way forward in due course.

Consolidation

TP UPDATE – Summer 2010
The Teachers' Pensions Regulations 2010 coming into force on 1 September 2010

Background
The Teachers’ Pension Scheme (TPS) is a statutory scheme and amendments to the governing Regulations are made by Parliament. The Teachers’ Pensions Regulations 1997 came into force on 3 February 1998, but have been amended by further statutes which have now been consolidated into a new set of Regulations.  Following a period of consultation undertaken by the Department for Education (DfE), the new Regulations will come into force on 1 September 2010.

As part of this process, the DfE undertook a thorough review of the 1997 Regulations and took the opportunity to remove outdated provisions such as “War Service”, re-structure the regulations and use a more user-friendly, gender-neutral, format.

Whilst the 2010 Regulations do not contain any fundamental changes to the level and range of scheme benefits, both members and employers should familiarise themselves with the changes which have occurred, some of which have a material affect in certain instances.  Details of the changes are listed as follows:

Significant changes: Affecting both employers and members

• Phased retirement - Salary reduction requirement changes from 25% to 20%
• Provision to restrict average salary in certain cases – different method to deal with significant increases in salary prior to retirement (applying to retirements on or after 2 September 2010)
• New Interest rate calculation for arrears of contributions (effective from 1 December 2010)

Employers: Matters affecting employer administration

• Paid family leave
• Greater clarity on exclusions from Contributable Salary
• Recovery of unpaid contributions
• Residential Emoluments
• Employments pensionable on election (within Parts 2 and 3 of Schedule 2)
• Provision for employers to settle valid "Preston" claims without claims up to 31 August 2012 without acclaim to the Employment Tribunal
• Changes affecting Independent schools or "Accepted schools"

Active Members: Matters affecting Active members (with consequential impact on employers in some cases)

• Additional Pension
• "Start date" for Additional Pension by monthly payment
• Payment of single contributions to Additional Pension
• Additional Pension - Paid Up Credits
• Additional Pension - Reserved Forces
• Members joining the TPS from the Teachers’ Schemes in Scotland, Northern Ireland, the Isle of Man and the Channel Islands
• Transfer values where part of the benefits have been taken
• Post retirement leavers with less than 1 year’s qualifying service

Matters affecting members about to retire

• Re-imbursement of pre 1973 member contributions
• Payment of interest on certain awards
• Commutation on grounds of serious ill-health
• Commutation on grounds of triviality
• Lump sum rule for members over 75
• Short Service Incapacity Grant (SSIG),
• Lifetime Allowance (LTA) charge

Matters affecting Pensioners

• Discretion to cease and recover benefits
• Evidence of continued entitlement

Matters affecting Pension Credit Members (PCMs)

• NPA for mixed service PCMs of 65
• Introduction of Actuarially Adjusted Benefits for PCMs
• The conversion of pension to lump sum for PCMs in certain cases

Death Grant provisions

• Death benefits when award papers are being processed
• Deductions from "out-of-service" death lump sums
• Nominations to receive the Death Grant
• Scheme members called up into the Reserve forces
• Supplementary Death Grant benefits for Additional Pension and Total Incapacity Benefit (TIB)

Budget - June 2010

Changes to uprating - Q & A
Independent Public Service Pensions Commission - Q & A
Changes to annuity arrangements - Q & A

New personalised calculators/modellers available

The following calculators/modellers are now available for scheme members who have not previously received an award of retirement benefits under the TPS, enabling the calculation of personalised estimates based on current information held by Teachers’ Pensions:

• Cost of buying Additional Pension benefits
• Conversion of Pension to Lump Sum

Access to the calculators/modellers is via the On-line Forms link within our secure website; My Pension Online. If you have not previously done so then you will need to register in order use this service. Registration is free, and when you have successfully registered we will provide you with a unique PIN number (by email or SMS text) so that you can login immediately.

Information for prospective Academies (PDF, 43KB)

Please find above information for schools considering going down the route of taking up Academy status in the light of recent government announcements.

The Teachers' Pensions Regulations 2010 (SI 2010 No 990) were laid before Parliament on 1 April 2010 and will come into force on 1 September 2010.  A summary of the changes in the TP Regulations is available below.

Summary of the changes in the Teachers' Pensions Regulations 2010 (PDF, 69KB)

Additional Pension - Maximum Amount

The maximum amount of Additional Pension Benefits (APB) that can be purchased by a member or employer for the Scheme year 1 April 2010 to 31 March 2011 amounts to £5,400 per annum.

If you or your employer have purchased APB in previous years, the indexed value of the previous APB will be deducted from the overall maximum for the current scheme year, in order to arrive at the net maximum still available to you.

The cost of purchasing Additional Pension in blocks of £250 per annum, with or without a reversionary spouses/civil partners/nominated partners pension, can be found in the calculators section of the TP website.

The Teachers' Pensions Regulations 2010

The Teachers' Pensions Regulations 1997 (as amended), which govern the TPS, have been subject to a consolidation exercise to incorporate the numerous amendments made since they came into force on 3 February 1998. The Teachers' Pensions Regulations 2010 were laid before Parliament on 1 April 2010 and are due to come into force on 1 September 2010.

In undertaking the consolidation exercise, the Department for Education have undertaken a thorough review of the 1997 Regulations. In addition to removing outdated provisions, the regulations have been restructured and written in an updated, more user-friendly - and gender neutral - format. The consolidation exercise has not involved any fundamental changes to the TPS but there are some changes that have a material effect which will be notified to employers in the next issue of TP News, and in a DfE Teachers' Pensions Letter which will be issued shortly.  These will be available on the TP website.  

Out of Service Teachers - Apply on-line for your Retirement Benefits.

The retirement application form to be completed by teachers who are "out of pensionable service" upon reaching normal retirement age is the latest addition to the forms that can be completed and submitted on-line.

The application form can be accessed via My Pension Online (alongside the other electronic forms), where registration is a straight forward process.

(Draft) Teachers' Pensions Regulations 2010

Please find below the letter regarding the (draft) Teachers' Pensions Regulations 2010, together with the set of draft regulations accompanied by a commentary.

• Letter to Consultees re: (Draft) Regulations 29.10.2010 (PDF, 712KB)
• Commentary on (Draft) Regulations 29.10.2010 (PDF, 171KB)
• (Draft) Teachers' Pensions Regulations 29.10.2010 (PDF, 697KB)

Comments on the draft regulations will only be accepted from bodies listed in the Annex to the covering letter.  Therefore, if a scheme member or an employer wishes to raise an issue with the draft regulations, you should contact your representative union or employer association.

Issues for high earners and those with very large salary increases:

• Issue 1 - The Annual Allowance and the potential impact on members who have a significant increase in pension benefits during a scheme year
• Issue 2 - The Special Annual Allowance Charge
• Issue 3: The Lifetime Allowance (LTA) Charge and the possible loss of “Enhanced Protection”

These issues are also available to download in PDF format (PDF, 51 KB).

Possible Postal Delays due to Cold Weather

Members and employers who are engaged in transactions with the TPS should be mindful of the potential impact of any postal delays due to the cold weather. For example:

• Employers who submit their monthly pension contributions by cheque should urgently consider adopting BACS payments. Failure to remit contributions by the due date because of any postal delays will result in interest being charged.
• Pensioners who continue to receive their monthly pension payments by cheque should adopt payment direct to their bank account and notify TP of their bank details in order that these payments are received on time.
• Members wishing to apply for retirement and other pension events should consider using the application processes available on the website for electronic transmission.

Member Information Pack

Member Information Pack - Employer Letter (PDF, 56 KB) Member Information Pack - Member Letter (PDF, 48 KB) Member Information Pack - Things you need to know as a member of the TPS (PDF, 58 KB)

Re-employment certificates

In previous bulletins and announcements we have informed employers of the secure online facilities available for data exchanges between TP and employers.  We are now pleased to announce that the completion and submission of re-employment certificates can now be made via the secure area member area of the website, My Pension Online. 

On receiving information from a member, or an employer, which indicates that a scheme member, already in receipt of pension, is employed in teaching, TP will issue a letter to the member informing them that they need to submit a certificate of re-employment via the secure member area of the website.  Once the member has completed their part of the form it will automatically be forwarded to their employer for further completion and submission to TP.

Employers will be notified when forms are in the secure area awaiting their completion.

You should be aware that employees will be responsible for the repayment of any overpayment of pension resulting from the failure to notify Teachers’ Pensions of any re-employment.

The online form can be found in the member secure area, My Pension Online.