Govt publishes judges’ reformed pension scheme and McCloud remedy consultation responses

The government has published its responses to consultations on reforming the judicial pension scheme and how age discrimination, as identified in the McCloud ruling, will be addressed.

It confirmed that, unlike the rest of the public sector, judges affected by McCloud will participate in an ‘options exercise’ in 2022, rather than making a deferred choice.

This will allow judges to make a retrospective choice of pension scheme membership backdated to 1 April 2015, when the discrimination began, until 31 March 2022, after which all judges will be moved to the reformed pension scheme.

Judges will have to choose between the Judicial Pension Scheme 1993 (JUPRA), or its fee-paid equivalent, Fee-Paid Judicial Pension Scheme (FPJPS), and the New Judicial Pension Scheme 2015 (NJPS).

The options exercise would also deal with the technical details of the choice, for example in respect of past tax and contributions.

The government said that while respondents “generally welcomed” the steps being taken, there were concerns about the options exercise proposal.

Many respondents believed that judges wishing to return to JUPRA/FPJPS should be able to do so before 2022.

However, the government said that running the exercise in 2022 would allow judges to “consider their own career and pay progression during the remedy period”, and that although “most” would be better off returning to JUPRA/FPJPS, some may find NJPA membership more beneficial.

From April 2022, subject to parliamentary time and approval of required legislation, all judges who are in service and are eligible for a judicial pension will automatically join the reformed scheme, unless they decide to opt out.

The reformed scheme will be a career average scheme, unlike JUPRA/FPJPS which were final salary, but it will be a tax-unregistered like JUPRA/FPJPS.

The government confirmed that there will be no annual allowance or taper, and no lifetime allowance in the reformed scheme.

It will have an accrual rate of 2.5 per cent, with no restriction on the number of accruing years in service, and a contribution rate of 4.26 per cent.

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