Prior to 2015 there were two parts of the scheme, the 1995 or the 2008 scheme. Members who had been part of the 1995 scheme were given the option of moving to the 2008 scheme and new members who joined after 2008 had to join the latter. Benefits in each part of the scheme were calculated differently.

In 2015 a new scheme was introduced in the NHS as a result of the findings by the commission set up by the Government in 2010 to “make recommendations on provision that is sustainable, affordable and fair in the long term” as it recognised that the cost of the public sector pension provision was not sustainable.

The drawing of benefits under the 2015 scheme is linked to normal state retirement age as opposed to 60 years old in the 1995 scheme and 65 in the 2008 scheme. To safeguard those members who were closer to retirement age, protections were put into place to ensure that those within a certain number of years from retirement could remain in their legacy scheme. In the NHS pension scheme this meant that anyone within 10 years of retirement at 1 April 2012 remained within the legacy scheme, and individuals who were not protected began accruing in the 2015 scheme automatically. There were transitional rules for individuals within around 10 to 13 years of retirement at 1 April 2012. Details of the dates of entry for these individuals to the 2015 scheme are on the NHSBSA website.

The McCloud (Judges) case and the Sargeant (Firefighters) case were brought by individuals who had also been transitioned into new schemes that had protections in place for older members. This had ramifications for all public sector schemes and the findings that the Government’s actions had given rise to unlawful age discrimination resulted in remedy hearings being undertaken.

The remedy is the name for the way that the Government will put right the unlawful age discrimination. The remedy for NHS members means that from April 2022 all members will have their accrued benefits converted back into their legacy scheme for a period of seven years between April 2015 and March 2022. Then all members regardless of age will be moved into the 2015 scheme. If members joined the scheme since April 2012 they will not have been treated differently due to age so they will be outside the scope of the remedy. At the date the members take their benefits they will be able to make the choice of how they wish to have their service during the remedy period treated. They can leave it in the legacy scheme or move it into the 2015 scheme.

Government has indicated that for members who incur additional annual allowance charges on electing to transfer their benefits from the legacy scheme to the 2015 scheme, they will not look to collect amounts other than would have been incurred if the election had not been made.

As annual allowance tax charges may have arisen during the remedy period due to accrual rates being higher in the 2015 scheme that no longer arise in the legacy scheme, Government have promised that they will refund these regardless of time limits. If on the other hand additional tax is due as a result of these arrangements Government has advised that they will not look to recover tax beyond the normal statutory limits.

NHS Pensions have also committed to a timescale of October 2023 to have their systems ready to produce the figures for scheme members to make an informed choice.

The decision to choose which scheme to have the remedy period in will have to be made at the date of drawing benefits in conjunction with a specialist IFA who understands the benefits within the NHS pension schemes. We can help our clients to check that their pension records are up to date and accurate. This will facilitate the compilation by NHS Pensions of clean data to ensure that the figures used give the accurate results to aid that choice.