Govt launches consultation on TPS changes

The government has published a consultation to seek views on the draft amendments to the Teachers’ Pension Scheme (TPS) regarding survivor benefits and phased withdrawal of independent schools.

In November 2020, the government announced that independent schools in England and Wales would be allowed to opt out of the TPS for future staff members, following a consultation.

Employer contributions to the defined benefit TPS increased to over 40 per cent in September 2019, leading to 178 independent schools leaving the scheme, as of September 2020.

The government is now seeking views on whether the amendments outlined in the consultation achieved the policy aim, with regulations to be put in place for 1 August 2021.

A school would become an accepted phased withdrawal school on the first day of the month after a successful application was made.

The Department of Education said it would provide “clear information” for independent school employers’ responsibilities when considering adopting phased withdrawal.

The consultation is also seeking views as to whether changes made in equalising survivor pension benefits will have the intended effect.

It has proposed changes to ensure that a surviving opposite-sex spouse or civil partner of a female member is treated in the same way as a surviving same-sex spouse or civil partner of a female member.

The government stated that the value of survivor pensions payable to some male survivors of female members may increase, and the scheme administrator will be contacting those known to be affected.

Additionally, the consultation said: “The changes to TPS rules would also affect female members who made additional Family Benefit contributions to purchase increased survivor benefits for their male spouse or civil partner, by covering some or all of their pensionable service between April 1972 to April 1988.

“The scheme administrator will review member records to identify and contact those female members who paid additional contributions to cover service that would now be provided automatically as a result of the above changes.”

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