McCloud Judgment and Remedy FAQs - Retiring soon or thinking of leaving?

NICS Pension Schemes - McCloud Judgment Remedy FAQs

What does it mean for those members who have taken ill health retirement since 1 April 2015 or are due to retire before the remedy has been implemented? 

The Department of Finance accepts that affected members of the reformed pension schemes who have retired since 1 April 2015 or will retire before the remedy has been implemented, already have an entitlement to be treated as a member of their legacy scheme for the remedy period if they wish.

However, giving effect to this entitlement before legislation is implemented creates complex issues, particularly where there are interactions with the tax system. Legislative changes will be made where necessary for devolved schemes through the Public Service Pensions & Judicial Office Act 2022 (PSPJOA 2022). There are also tax and scheme-specific legislative changes which will be required before the remedy can be implemented.

We will make sure that details of the process are updated to the website and provided to both members and employers when they become available.

I am retiring soon, how will I be affected?

All members who were subject to the discrimination will be within scope of any changes made to schemes, irrespective of their status, i.e. pensioner, still in service (active member), left service but not yet taken benefits (deferred member).

It’s unlikely that any changes will be made prior to you leaving, so your pension will be based on the current position, as shown in your annual benefit statements.  Should there be subsequent change needed due to the pension scheme changes being implemented, then we will write to you to confirm. Please be assured, however, that the pension you have earned to date is safe.

If you’re moving address, please ensure you advise Civil Service Pensions (NI) of your updated details.

How will people who retire before the introduction of the deferred choice underpin be treated?

Members who have retired before the DCU is implemented and have a period of relevant service between 1 April 2015 and 31 March 2022, will be offered a choice once the legislative changes have been made to implement the DCU. The choice will be retrospective and backdated to the point that payment of pension benefits began.

There are still complex issues to be resolved before schemes are in a position to process cases on a consistent basis - further updates will be provided as soon as possible.

In all cases where an individual receives a revised pension award, this will be backdated to the date their pension award relating to the remedy period was originally made.

If members have already retired before the settlement is worked out can they change their pension for the years since 1st April 2015?

Yes - Retirees from both legacy and reformed schemes who were in service on or before 31 March 2012 and on or after 1 April 2015 will be offered the choice on which arrangement they wish to be in for the remedy period.

If I leave my job or retire, will I still have my pension looked at?

Yes. All members who were subject to the discrimination will be within scope of any changes made to schemes, irrespective of their status, i.e. pensioner, still in service (active member), left service but not yet taken benefits (deferred member).

My State Pension Age (SPA) is less than 65, can I retire from alpha at my SPA or do I need to wait until 65?

Some female members may have a SPA below the age of 65, however according to the Public Service Pensions Act (Northern Ireland) 2014, the Normal Pension Age (NPA) of the reformed scheme (alpha) is the same as the members SPA or 65, whichever is higher.  You may however retire before that date but your pension would be subject to Actuarial Reduction.

If I retire before October 2023 I will have less than 2 years’ service accrued in alpha, what will happen with that?

As you are already a member of the NICS Pension schemes, you do not require 2 years’ service in alpha to qualify. Qualifying service in the PCSPS(NI) also counts towards qualifying service in the alpha scheme.  For example if you joined Nuvos in 2010, the period of service between 2010 and 2022 will count as qualifying service in alpha.  If you are not yet at Scheme Pension Age you can collect the alpha period reduced or defer and collect later.

How will the move to alpha affect people in my age group who might want to apply for partial retirement? Will the terms be based on the legacy scheme or reformed scheme?

You will have the opportunity to apply for partial retirement once in your legacy scheme and once in your alpha scheme, unless you decide to take your alpha and legacy benefits at the one time. So for example, if you are a hybrid member of the ‘Classic’ and ‘alpha’ scheme, and over the age of 60, you can apply to take partial retirement and access your Classic pension in full without reduction, without accessing your alpha pension at the same time.  You can continue to accrue alpha pension and choose to apply to partially retire in alpha at a later date.  So as long as you meet the eligibility criteria for partial retirement on each occasion, for example reduce your earnings by 20% by reduction of working hours or downgrading. You should be aware that your pension may be subject to abatement, further information is available in What is abatement?

For someone partially retired how will moving to the alpha Pension Scheme affect any pension accrued where there is a mixture of Classic and alpha at full retirement date. How will the backdated remedy action in relation to the McCloud Judgment affect pension calculation at the point of partial retirement?

Partial retirees only get one choice. If you partially retired before the remedy period (pre 1 April 2015) but have remedy period service – then you will get your choice on leaving (final retirement), subject to legislation being in place.

If you partially retired during the remedy period – you will get your choice at partial retirement or as soon as practicable afterwards, again subject to legislation being in place. There is no choice on Final Retirement regardless if in remedy period or after remedy period.

If you partially retire after the remedy period – you will get your choice at partial retirement, subject to legislation being in place.

For those who have already partially retired, the Department will offer claimants their choice when the relevant legislation is in place, which is expected to be implemented no later than 1 October 2023, as per the primary legislation. 

I have little or no understanding of the proposed Remedy scheme and am concerned this will be detrimental to my pension forecast.  I am eligible for retirement this year with 21 years’ service and wonder if it would be better to defer my retirement until the Remedy plan is completed?

You are under no obligation to delay your retirement plans.  If you retire before the scheme changes are made your pension will be calculated based on the service built up before the remedy is implemented, comprising of legacy benefits until 31 March 2022 and alpha benefits thereafter.  You will get the chance to make a retrospective choice regarding the remedy period when the scheme changes have been made.  Other than no longer accruing pension, this would not be detrimental to your pension forecast.

Should I just opt out?

If you are thinking of opting out of the Civil Service Pension (NI) arrangements, remember that if you do, you will miss out on a range of valuable benefits for you and your family. Your pension is an important part of your pay and reward package. As well as your pension contribution, your employer also pays a pension contribution on your behalf.

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