Around 5 per cent of NHS Pension Scheme members could be affected by historic administration issues, with the Government Actuary’s Department (GAD) appointed to conduct a comprehensive audit of the scheme, the government has confirmed.

Minister of State for Health, Karin Smyth, said the NHS Business Services Authority (NHSBSA), which administers the scheme on behalf of the Department of Health and Social Care, had identified issues affecting the administration of a “small proportion” of member records.

The earliest cases date back to 2008, although Smyth said most of the issues had built up between 2014 and the present day, with a small number still ongoing.

While the “vast majority” of members are receiving the correct pension amount, the minister confirmed that some affected members will have been entitled to receive more.

Based on the information currently available, around 95 per cent of NHS Pension Scheme members are expected to be unaffected, with many of those potentially affected already retired and receiving their pension.

Smyth confirmed that GAD had been appointed to lead a comprehensive audit of the scheme’s administration to establish with “absolute certainty” that all affected members have been identified.

In addition, a new departmental board, including external and independent expertise, has also been established to oversee the NHSBSA’s implementation of the audit findings and its wider pensions operations.

Affected members will be contacted directly by the NHSBSA, with records corrected and pension awards updated where appropriate. Any payments or increases owed will also include interest.

Smyth stressed that no action was required from NHS Pension Scheme members, whether they are currently working or retired, and said the NHSBSA would continue to process pension payments and retirement applications.

The issues were uncovered as the NHSBSA reassessed how the scheme’s rules were being applied following work on the implementation of the McCloud remedy.

The development comes after the NHSBSA failed to meet its McCloud delivery deadlines in 2025, prompting Smyth to commission NHS Pensions Board chair, Lisa Tennant, to undertake an independent review of the authority’s delivery of the remedy in July last year.

The review, which has now been published, identified issues across both strategic and operational areas, including governance, leadership, organisational culture, operating models, operational readiness, digital and data, customer experience and change management.

Smyth said the report showed that further action was needed to put the NHS Pension Scheme “on a secure footing” and prepare it for “long-overdue modernisation”.

Since commissioning the review, the department has increased its oversight of the scheme, including requiring more frequent and detailed performance reporting from NHSBSA and increasing resources for McCloud planning and delivery.

The NHSBSA has also established a dedicated leadership team for the NHS Pension Scheme.

However, following the newly identified administration issues, Smyth has directed the NHSBSA to reassess the deliverability of its existing McCloud plans.

She warned that the implementation of the McCloud remedy had placed “significant additional pressure” on the administration of the scheme, which was already under strain due to increasing membership, scheme complexity and outdated technology infrastructure.

Smyth said she would continue to hold the NHSBSA to account and provide further updates to parliament, including on the progress and findings of the GAD audit and revised statutory deadlines for McCloud once the government was confident they were deliverable.

She added that if sufficient progress was not made, she would consider what further action was required.

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