Government Consultations

On 27 July 2011 the UK Treasury issued a briefing titled “Government consultation on proposed pension contribution changes for civil servants, NHS workers and teachers”. This news release sets out the Government’s framework for a proposed increase in employee contributions to the unfunded public sector pension schemes: Civil Service Pension Scheme, Teachers’ Pension Scheme and NHS Pension Scheme.

It also explains that the relevant Government departments (Cabinet Office, Department for Education (DfE) and Department for Health respectively) would be simultaneously issuing details of the basis on which the contribution increases would apply separately to their particular scheme, within the boundaries set by the Treasury, and opening the subject to consultation with members and stakeholders.

The consultation is seeking view on the proposed employee contribution structure from April 2012 to April 2013 and is open until 20 October 2011.

While the announcement from the Treasury and the opening of the departmental consultation process came as a surprise to most participants in the reform process to date, the content of the document and the proposed contribution increases are in line with those which have been previously made public. These principles reflect the Government’s wish to protect the lower paid; apply the increases progressively; limit opt outs from the pension schemes.

The consultations apply to the Civil Service Pension Scheme in England, Scotland and Wales and the NHS and Teachers’ Pensions Schemes in England and Wales. Consultations have yet to be launched for the Scottish Teachers’ and NHS schemes but they are also likely to be affected. It is important to note that this consultation refers to pension contribution increases for civil servants, teachers (including lecturers) and NHS staff for the financial year 2012/13 only.

The proposals follow on from the report by Lord Hutton on wider public sector pensions reform, however this initial employee contribution increase is only one part of the discussions on the package of reform to take place from 2015. The Treasury has said that it will continue to discuss with unions how to achieve the required savings in 2013/14 and 2014/15 as well as the longer term reforms from 2015 onwards as part of the scheme specific negotiations that are taking place between the relevant Government departments and trade unions

Consultation processes and documentation

UCEA is working with the relevant departments on behalf of the HE sector to ensure that all scheme employers, members and other stakeholders are aware of the consultation and that they have the opportunity to respond. Initial indications are that it is the duty of the Government departments to consult with employer member representatives of HE schemes, rather than the individual employers as it was with the USS reforms. More information can be found in the detailed consultation documents issued by the relevant departments. These include member examples showing how different employees may be affected by the contribution increases. Links to each of the consultation documents are provided below.

Teachers' Pension Scheme

Significant numbers of HE staff are in the TPS in England and Wales, predominantly in post-92 institutions. The DfE has confirmed that it supports employers sharing these documents with their employees and encouraging them to respond to the consultation on an individual basis or through representative bodies as it would like to consult as widely as possible.

The consultation documents can be found here:
DfE press statement including member examples
DfE e-consultation link providing full details of the consultation and how to respond

NHS Pension Scheme

A relatively small number of HE staff are likely to be affected by the proposed changes to the NHS pension scheme, such as clinical academics. Consultation documents can be found at the Department of Health consultation website which provides details of the consultation and how to respond.

Civil Service Pension Scheme

There are very few HE employees who are members of the Civil Service Pension Scheme. However, some staff will be affected usually due to legacy issues such as TUPE across of civil service staff on transferring a previous Government function to a University. Consultation documents can be found on the left hand side of the homepage of the Civil Service's website . They include FAQs and a contribution calculator.

Local Government Pension Scheme

Due to the funded nature of LGPS scheme specific discussions are ongoing as to how any contribution increase might be applied and whether any other cost saving mechanisms, such as a change to benefit structure, could be used to meet the Government’s savings target. Employers and unions have held a constructive initial meeting to discuss how to avoid a controversial increase in how much staff pay for their pensions. Representatives from the Local Government Group (LGG), GMB, Unite and Unison met last week in the first of a series of meetings to discuss alternative ways to reduce the cost of local government pensions by £900m over the next three years. Further meetings have been set up over the coming weeks. UCEA will be involved in the discussions and will provide updates on the progress made.

For more details on the UCEA submissions please address to Emelda Conroy, UCEA’s Head of Pensions Policy, e.conroy@ucea.ac.uk

Return to section header