On this page you’ll find Remedy Information for both the Firefighters’ Pensions Schemes and the Local Government Pension Scheme.
Firefighters’ Pension Scheme
Introduction
In April 2015, a new pension scheme (called FPS 2015) was introduced. As part of the roll out of the new scheme, some members were given ‘protection’ and remained in their legacy scheme for a set period of time after April 2015.
After a legal challenge by the Fire Brigades Union (FBU) on behalf of FPS members, the courts determined that these protections were age discriminatory and not fair to all members of the pension scheme i.e. younger members in the scheme were missing out on additional years of benefits from the original pension schemes.
In order to remedy age discriminatory treatment across public sector schemes by removing the discriminatory treatment while protecting members who may have been better off in the reformed schemes, the changes were introduced from 1 October 2023 aim to give all members the same choice of benefits for the remedy period (1 April 2015 to 31 March 2022). The process to remove the age discrimination is called McCloud/Sargeant Remedy. In Fire we use the term Sargeant Remedy.
Not all members are affected by remedy. Members that are eligible to make choices for the remedy period must:
- have been in pensionable service on or before 31 March 2012; and
- had pensionable service between 1 April 2015 to 31 March 2022; and
- not have a gap in service of 5 years or more (known as a disqualifying break).
Pensionable service does not have to have been in the firefighters’ pension scheme, it could also have been in another relevant public service pension scheme i.e. NHS, Teachers or Local Government.
Active and deferred members
If you are in scope for Remedy, you will be able to choose whether you want to receive your former legacy scheme pension (FPS 1992/FPS 2006 Modified/FPS 2006 Standard) or new reformed scheme (FPS 2015) pension for the period 1 April 2015 to 31 March 2022 at the point you retire. This is called Deferred Choice Underpin.
Remediable Service Statement (a supplement to Annual Benefit Statement) will include a comparison of the two sets of benefits for the period from 1 April 2015 to 31 March 2022 (known as the remedy period).
You do not need to make a choice straight away, you will only make a choice at retirement, but you will need to receive an RSS statement on an annual basis to remind you what your benefits will look like at retirement.
Pensioner members
If you are in scope for Remedy i.e. retired any time between 1 April 2015 and 31 March 2022 and any period prior to 1 October 2023 you are in Immediate Choice category and will be issued Immediate Choice Remediable Service Statements (IC-RSS) where you will be given two sets of calculations for your legacy scheme (FPS 1992, FPS 2006) and reformed scheme (FPS 2015) for the remedy period 1 April 2015 to 31 March 2022.
The Firefighters’ Pension Schemes Member website has been developed to give scheme members information about the benefits and options available to them.
The website contains a lot of Frequently Asked Questions as well as specific member remedy section and other useful information. The content to help explain remedy to members is being updated in line with those changes when they happen. You can find out more about these changes in the News section.
Immediate Choice (Pensioners, Beneficiaries) RSS Rollout Update
Treasury directions confirm that arrears of pension should be awarded interest at 8%. The 8% aligns with interest awarded via the Court claims. The treasury directions published in December 2022, instruct scheme managers to pay interest at a rate of 8% on lump sum top up payments and pension arrears where an increased amount is due as result of the members’ choice.
There are on-going technical issues with regards to calculating the tax charges due on remediable lump sums which is causing a delay in issuing Immediate Choice Remediable Service Statements (IC-RSS). The delays being experienced are solely due to a lack of clarity, from both HM Revenue & Customs (HMRC) and HM Treasury (HMT), about some specific technical issues which affect some members.
There are two issues, both of which are about unauthorised payments, they are: –
1) Interest payments that are to be paid on arrears of pension and lump sum.
2) How any new unauthorised payment is calculated when compared to the original retirement.
The delays in getting a resolution to these issues is likely to mean a temporary move away from the published remedy timeline, but as soon as the issue is resolved the timeline will be re-established.
This issue only affects immediate choice members who received an unauthorised lump sum from the 1992 scheme when they retired. These members will have paid an unauthorised payment tax charge on some of their lump sum.
– unprotected and taper protected legacy FPS 1992 members who received the maximum scheme lump sum and had an unauthorised payment tax charge.
Administrators will be unable to progress these cases until there is a resolution from HMT and HMRC. NYFRS has contacted these members and informed them of this issue.
This does not prevent IC-RSS being produced for members with authorised lump sums. Current retirements are unaffected and continue to be processed as normal.
It has been confirmed that LGA’s understanding of how you would offset the original unauthorised payment made to HMRC does not align with current HMRC policy. Currently there is no provision within HMRC legislation that allows an offset approach for individuals who have made an unauthorised payment through the mandating process (which you did when you originally retired). This position, if left without a solution, will mean that you become liable for more tax which is not currently reclaimable either via HMRC or the compensation mechanism in the Public Service Pensions and Judicial Offices Act 2022.
Our colleagues at the LGA have been liaising with HM Treasury (HMT) and HMRC on this matter and there is an agreement in principle from all parties to put in place a resolution to address this. It is likely that any resolution will need new legislation which will take time. These discussions are progressing well, however, as we have now entered the pre–General Election period of Purdah it is unlikely that anything official will materialise before 5 July 2024 (and it could be sometime thereafter).
We wrote to pensioners who are affected by this issue so if you did not receive the letter, it does not concern you. Please check your pension account with West Yorkshire Pension Fund for any address changes as well as informing the payroll team of any changes made either directly or on My View payslips platform if you are an active employee. It is important we have the correct details if we need to contact you in the near future.
Timeline information
The original timetable published in November 2022 had expected legislation and software to be available before September 2023.
There were unanticipated delays with:
- Relevant legislation and accompanying guidance being in place.
- Software and automated solutions to produce bulk Immediate Choice RSS from 1 October 2023.
- The issuing of the final RSS templates.
These factors have delayed the production of RSS from the anticipated date of 1 October 2023.
The process to implement Remedy is complicated and requires changes to pension administration software. West Yorkshire Pension Fund are having CIVICA software upgrade issues where more testing is required before the upgrade is finalised. The software supplier and WYPF administrators are working closely together to prioritise development of necessary software and automated processes.
Due to these delays the original suggested dates were amended.
Communication
To aid members with understanding the timeline of when they will receive their individual Remediable Service Statement (RSS), some specific communications were published.
For Immediate Choice members (pensioners, beneficiaries): details of what to expect from October 2023 was published: –
- Letter – Warm up communications to retired members were sent out in September 2023 by WYPF administrators.
- Understanding the timescales around remedy animation video
For Deferred Choice members (active and deferred (leavers)): details of what to expect from October 2023: –
- Letter – Warm up communications sent to active/deferred members in September 2023 by WYPF administrators.
- Understanding the timescales around remedy animation video.
Age Discrimination Remedy Member Comms
- Factsheet on Contributions Adjustment released on 5 April 2024
- Remedy Frequently Asked Questions factsheet
- Factsheets are going to be added for Age Discrimination Remedy Annual Benefit Statement Remediable Service Statement available on FPS website.
Age Discrimination Remedy – Contingent Decisions
A Contingent Decision (CD) is a decision taken by a member, relating to their membership of the Firefighters’ Pension Scheme (FPS), that would have been different had it not been for the discrimination identified by the courts.
The decision will relate to a member’s membership of the Firefighters’ Pension Scheme (FPS) during the Remedy Period (1 April 2015 to 31 March 2022).
There are three categories of Contingent Decision in the FPS for which specific provision has been made:
- Opt-Outs: A Member who would not have opted-out if they had been allowed to remain in the Legacy Scheme (FPS 1992/FPS 2006) beyond their transition date or if protected Members had been allowed to join the 2015 Reformed Scheme from 1 April 2015.
- Additional Service: Members argue they would have purchased (more) additional service if they were in the Legacy Scheme.
- Transfers: Members chose to transfer (in or out) and now wish to revisit the decision, or they chose not to transfer and now wish to do so – Guidance on this topic will be provided in due course.
Where a member makes a contingent decision, there will need to be an adjustment to your benefits, which may involve you paying extra contributions more information including the claim form can be found on the FPS website
Local Government Pension Scheme Information (For the attention of Control Room Staff and Support Staff)
When the Government reformed public service pension schemes in 2014 and 2015, they introduced protections for older members. In December 2018, the Court of Appeal ruled that younger members of the judges’ and firefighters’ pension schemes had been discriminated against because the protections did not apply to them.
This ruling is called the McCloud judgment, after a member of the Judicial Pension Scheme involved in the case. Because of the ruling, all public service pension schemes that provided protection, including the LGPS, have been changed.
The changes are called the McCloud remedy. They remove the age discrimination found in the McCloud court case.
Will it change anything?
In 2014, the LGPS changed from a final salary scheme (a pension based on your pay when you leave) to a career average scheme (a pension which builds up based on what you earn each year). Older members who were closer to retirement were protected from the changes. When a protected member took their pension, the pension from the career average scheme was compared with the pension that would have built up in the final salary scheme. The member received the higher amount. This protection is called the underpin.
To remove the McCloud age discrimination, qualifying younger members will now receive underpin protection too. Underpin protection only applies to pensions built up in the remedy period, between 1 April 2014 and 31 March 2022. Underpin protection stopped earlier if you left the Scheme or reached your final salary normal retirement age (usually 65) before 31 March 2022.
From 1 April 2022, there is no underpin protection. Pensions built up after this date are based on the career average scheme only.
Further Information is contained within the LGPS McCloud Factsheet (003)
Useful Links
The Firefighters’ Pension Schemes Member website
Local Government Association Bulletins
West Yorkshire Pension Fund Pension Account
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