McCloud remedy - latest position June 2021

Publication date: 14/06/2021 16:07:08

What is the McCloud case?

The case concerns the transitional protections given to scheme members, who in 2012 were within 10 years of their normal retirement age, in the judges and firefighters schemes as part of public service pensions reform. Tapered protections were provided for those 3-4 years younger. On 20th December 2018 the Court of Appeal found that these protections were unlawful on the grounds of age discrimination and could not be justified. Read more here.

What are the implications of the case?

Those members who have been discriminated against will need to be offered appropriate remedies to ensure they are placed in an equivalent position to the protected members. Such remedies will need to be ‘upwards’ - that is the benefits of unprotected members will need to be raised rather than the benefits of protected members being reduced.

If the case is about the judges and firefighters schemes why does it apply to all public service schemes?

Protections were applied to all members within 10 years of retirement in all public service schemes. Protection took varying forms from scheme to scheme. Although the McCloud case only relates directly to the judges and firefighters schemes the government has confirmed, in a statement by the Chief Secretary to the Treasury on 15th July 2019, that the principles of the outcome would be accepted as applying to all public service schemes.

What LGPS protections are in scope for McCloud?

Unlike other public service schemes, the LGPS moved all members into the CARE scheme whatever their age on 01 April 2014. Those active members who were within 10 years of their 2008 scheme normal pension age on 31st March 2012 were protected via the statutory underpin. Protected members who meet the criteria for the underpin to apply, currently receive the better of their CARE pension or one calculated under 2008 scheme rules.

What remedy has been proposed for the LGPS?

The MHCLG consultation proposed that a two-part revised underpin apply to all members who meet the criteria for protection regardless of their age in 2012. The revised underpin will also apply to early leavers and will take account of early/late retirement adjustments. Membership up to earlier of leaving, 2008 Normal Pension  Age or 31st March 2022 will be included in the calculation of the revised underpin.

It is proposed that the revised underpin will extend to qualifying members who have left the scheme since April 2014 as well as active members. It should also apply on death in service and survivor benefits.

What does this mean for SCPF and our employers?

To implement the remedy, we need to hold the correct data. This means we need up to date and accurate working hours and service breaks for all members. We will be contacting employers in the coming months asking you to confirm that, to the best of your knowledge, you have been providing the data we need for all scheme members.

If you wish to discuss your individual employers position in the meantime, please contact cheryl.morrell@shropshire.gov.uk

 

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