On the go: The government introduced the public service pensions and judicial offices bill in the House of Lords on Monday that will allow the implementation of the McCloud remedy.
The new legislation, introduced by Conservative peer Viscount Younger of Leckie, was first announced in the Queen’s Speech in May.
The bill intends to fix the age-based discrimination against younger pension scheme members that stems from reforms introduced to public sector schemes in 2015.
These reforms meant that while most members were moved to new career average revalued earnings schemes, individuals aged 44 years or more on April 1 2015 were allowed to stay in their original defined benefit schemes.
The Court of Appeal had ruled this reform was unlawful in 2018 after the McCloud and Sargeant cases.
The new rules will formally afford eligible members the right to choose which set of benefits they wish to receive for the “remedy period” between April 2015 and March 2022.
All members will be moved to the reformed pension schemes by March 2022, “ensuring equal treatment from that point on”, it was stated at the time.
The general purpose of the bill is to ensure “public service pensions continue to reward public servants for their dedicated service, while being fairer — especially for lower earners — and more affordable to the taxpayer”.
The draft legislation also contains specific provisions for members of the Judicial Pension Schemes due to its specific circumstances.
The aim behind the added provisions for the specific scheme is to support “recruitment and retention in the judiciary (…) by reforming their pension arrangements and increasing the judicial mandatory retirement age”.
Members of the judiciary will be moved into a reformed pension scheme where the mandatory retirement age of judicial office holders will be raised from 70 to 75, and the power to set judicial allowances will be placed “on firmer legal footing”.
The bill does not specify provisions made for the police and firefighters’ pension schemes.
Pensions Expert has previously reported on several complaints made by members of these schemes that the new bill removes protected pension rights and introduces new types of sex and age discrimination.
The government estimates that the cost of providing additional pension benefits to comply with the McCloud remedies, during the remedy period, will be £17bn, excluding administration costs.
