Advice, guidance and news about teachers' pensions.
Advice and guidance about pensions including information on the latest pension updates (including the 2019 salary band contribution changes), pensions advice and key documents.
The government has published its response to the July 2020 public consultation - Public service pension schemes: changes to the transition arrangements to the 2015 schemes consultation. The NEU is pleased that the government has adopted our position and favours ‘Deferred Choice’.
The Government has announced its decision on how to deal with age discrimination issues in Teachers’ Pension Scheme (TPS). The issue and its solution affect pension arrangements for the vast majority of serving teachers.
The Government has published the proposed increases in teachers’ pensions with effect from 6 April 2020.
The Government has published the proposed increases in teachers’ pensions with effect from 12 April 2021. This follows confirmation by HM Treasury of the Consumer Prices Index inflation figure for September 2020. The same proposed increases apply to local government pensions. The necessary statutory instrument will be laid in due course.
Those pensioners whose pensions began on or before 27 April 2020 will receive an increase of 0.5 per cent, in line with the increase in the Consumer Prices Index.
This is a smaller increase than the 1.1 per cent which would have been payable had the previous indexation link to the Retail Prices Index still been in operation.
Those pensioners who have retired on or after 28 April 2020 will receive a proportionate increase based on CPI. The following table shows the pensions increases payable. It should be noted that the dates shown are the dates the pension begins and not the date of retirement.
|
Pensions Beginning Date |
Percentage Increase |
|
On or before 27 April 2020 |
0.5% |
|
28 April 2020 to 27 May 2020 |
0.46% |
|
28 May 2020 to 27June 2020 |
0.42% |
|
28 June 2020 to 27 July 2020 |
0.38% |
|
28 July 2020 to 27 August 2020 |
0.33% |
|
28 August 2020 to 27 September 2020 |
0.29% |
|
28 September 2020 to 27 October 2020 |
0.25% |
|
28 October 2020 to 27 November 2020 |
0.21% |
|
28 November 2020 to 27 December 2020 |
0.17% |
|
28 December 2020 to 27 January 2021 |
0.13% |
|
28 January 2021 to 27 February 2021 |
0.08% |
|
28 February 2021 to 27 March 2021 |
0.04% |
|
28 March 2021 onwards |
Nil |
From 1 April 2021, the contribution bands for employee pension contributions to the Teachers’ Pension Scheme will rise by 0.5 percent. This is in line with the September 2020 increase in the Consumer Prices Index (CPI).
This increase only affects the contribution bands. The contribution rates remain the same. The increase applies to members in both the Career Average and Final Salary sections of the scheme. The contribution structure is based on the teacher’s actual salary, rather than the full-time equivalent (FTE) salary.
The tiered contribution rates for the TPS from 1 April 2021 will be:
|
Annual Salary (1 April 2020 – 31 March 2021) |
Annual Salary (1 April 2021 – 31 March 2022) |
Member Contribution Rate (%) |
|
Up to £28,168 |
Up to £28,309 |
7.4 |
|
£28,169 - £37,918 |
£28,310 - £38,108 |
8.6 |
|
£37,919 - £44,960 |
£38,109 - £45,185 |
9.6 |
|
£44,961 - £59,587 |
£45,186 - £59,885 |
10.2 |
|
£59,588 - £81,254 |
£59,886 - £81,661 |
11.3 |
|
£81,255+ |
£81,661+ |
11.7 |
The Government has confirmed that Career Average pension rights for members in the Teachers’ Pension Scheme (TPS) will be increased by 2.1 per cent in April 2021.
Members with deferred pensions will have their Career Average pension rights increased by 0.5 per cent in April 2021.
Most teachers are in the Career Average section of the TPS. Their pension is being built up at 1/57 of their pensionable earnings each year. These pension rights are then increased each year until retirement at the Consumer Prices Index (CPI) rate of inflation + 1.6 per cent for teachers who stay in teaching, or at CPI inflation only for those who leave the TPS.
The increase is based on the CPI figure from September 2020, which was 0.5 per cent.
Employer pension contributions are set to rise from 16.4 per cent to 23.6 per cent in September 2019. The Department for Education has been running a consultation on whether this increase should be funded by Government for the period September 2019 to April 2020 for certain sectors. The NEU's response, is arguing this should be done. Independent schools and the post-1992 universities are not within the scope of this consultation and will face serious pressures as a result.
Information about the final salary section of the Teachers’ Pension Scheme (TPS), including how to find out if you are in this TPS section.
An overview of the Local Government Pension Scheme, introduced in 2014
The Teachers’ Pension Scheme will provide much of your retirement income so it is vital that you understand it.
Check your pension records - The NEU receives many reports of pension records being incorrect. The growing fragmentation of the school system means a growing number of small employers, and more changes of employer for teachers over their careers. These are perfect conditions for mistakes to be made.
Members should sign up with the Teachers’ Pension Scheme’s MyPensionOnline service and check your pension is correct.
Local Government Pension Scheme
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An overview of the Local Government Pension Scheme, introduced in 2014
The Teachers’ Pension Scheme will provide much of your retirement income so it is vital that you understand it. This guidance covers the career average section of the Teachers’ Pension Scheme (TPS) in which most members are accruing pension.
Information about the final salary section of the Teachers’ Pension Scheme (TPS), including how to find out if you are in this TPS section.
