Agencies Pensions Update

Transcription

1 Agencies Pensions Update Keeping Employers Updated on Scheme Developments Issue Highlights Contact Us Newsflash Bulletin 87 Discretionary Payments Consultation: Draft Regulatiosn 2012 Strike Action: Buy Backs Dexter House 2 Royal Mint Court London EC3N 4LP Newsflash Following recent negotiations between Government, Local Government Group and Trades Unions, it appears that a broad level agreement has been reached for future scheme reform. It appears that there will now be a one stage reform process rather than the previous proposal which was to consider short and long term reforms. Details of the agreement are awaited, but the long term reforms will now be introduced in 2014 (a year earlier than expected) and the planned employee increase in April 2012 appears unlikely. Key elements of longer term scheme reform still include a move to a career average scheme with a retirement age in line with the state pension age. As more information becomes available this website will be updated Finally, we would like to wish you all a very Merry Christmas and a Happy New Year, and thank you for all your support during We look forward to working with you in Greg Smith Corporate Development Manager greg.smith@lpfa.org.uk Bulletin 87 The Local Government Pensions Committee (LGPC) released its latest bulletin, number 87, at the start of the month which covered many different topics. The bulletin can be found at and the main topics covered included: Appointment of a new LGA Head of Pensions; Danny Alexander s statement to the House of Commons on 2nd November 2011; The Pensions Act 2011 received Royal Assent on 2nd November 2011; A small change to Auto-Enrolment staging dates; Fixed Protection for the Lifetime Allowance; and The Localism Act 2011 received Royal Assent on 15th November 2011.

2 Auto-Enrolment The Pensions Act 2011 has introduced the earnings threshold for automatic enrolment set at 7,475. Stephen Webb MP and the Pensions Minister, announced on 28th November that the smallest organisations, i.e. those with fewer than 51 employees have had their staging date for Auto-enrolment delayed until after the next election in May There is no change for the staging date for those organisations with more than 3000 employees, but those who have between 51 and 3000 employees will see slight delays. Full details of those changes will be released in the new year. These regulations are entirely separate from the pension scheme regulations, but empower scheme employers to pay compensation to individuals in the pension scheme or eligible to do so. Jacqui Lawrence Technical Officer Discretionary Payments - Injury Allowances The Local Government (Discretionary Payments) (Injury Allowances) Regulations 2011; The updated discretionary payment regulations, circulated last week, replace the existing provisions for compensation for loss of earnings or death due to work related injuries and illnesses (a relatively rare occurence) with effect from 16th January The current provisions are contained in the Local Government (Discretionary Payments) Regulations Draft regulations were circulated for consultation in December 2010 and were highlighted in the December 2010 Pensions Update. The new regulations wholly revoke the remaining parts of the Local Government (Discretionary Payments) Regulations 1996 which formerly provided for compensation in the same circumstances. There are several major changes concerning which employers need to take note of: The new regulations apply only to employers listed in Schedule 2 of the Local Government Pension Scheme (Administration) Regulations 2008, generally referred to as scheduled bodies ; that is to say local authorities and certain other major public bodies. Also covered are employees of voluntary schools, foundation schools or foundation special schools, certain technical institutes or federated schools that the local authority has designated as being eligible for membership of the scheme. The new regulations do not provide for payment of compensation by admitted bodies. That means to say employers whose employees are eligible for membership of the Local Government Pension Scheme by virtue of an admission agreement, either as a body providing services complimentary to local authority functions or in respect of the provision of services contracted out by a local authority. Before making a determination to award compensation, the employer will be required to obtain a certificate from an independent registered medical practitioner certifying that the employee meets the qualifying conditions for an award. Specific provision is made for a two stage appeal process in relation to injury awards, which mirrors the Internal Dispute Resolution Procedure under the Local Government Pension Scheme. There are no longer any provisions for payment of gratuities in respect of non-pensionable service, which has chiefly applied in the past to retirees with part-time service not formerly eligible for scheme membership. A letter from the department for Communities and Local Government concerning the impact the removal of this provision and possible alternative means of compensation accompanies this edition of Pensions Update. In the same instruction, it appears that a new method to fulfil any contractual obligations for payment of gratuities will be put in place - we do not currently have details of how this would work. In the absence of further guidance if any employer has a case where a gratuity would have been payable please contact the LPFA. To view a copy of the letter from the department for Communities and Local Government please see the link bellow: pdf

3 Employers covered by the discretionary powers will need to: Appoint persons to make first instance decisions and to reconsider decisions concerning entitlement or otherwise to an award. Formulate, publish and keep under review the policy that it applies in the exercise of its discretionary powers to make any award under the Regulations. Transitional provisions Notwithstanding the revocation of the Local Government (Discretionary Payments) Regulations 1996, where the event by virtue of which an allowance or lump sum may be payable occurs before the 16th January 2012, the provisions of the 1996 Regulations will continue to apply including those governing decisions and appeals. The existing appeals process will also apply for further six months in order for employers have time to set up an internal dispute resolution process. The regulations themselves and explanatory memorandum, the accompanying covering letter, a summary of responses to the consultation can be found via the following links: Regulations: Explanatory Memorandum: Injury%20Regs%20Regs% pdf Cover Letter: Covering%20letter.pdf Summary Response to the Consultation: SHORT%20SUMMARY.pdf It is anticipated that the Local Government Pension Committee will cover the provisions of the revised Injury Allowance Regulations in detail in a future circular and provide draft forms to cover the requirement for certification by a suitably qualified independent registered medical practitioner. In the meantime any employer with concerns about the impact of the revised provisions should contact LPFA. Alan Piper Pensions Specialist Manager alan.piper@lpfa.org.uk

4 Consultation: Draft LGPS Regulations 2012 The department for Communities and Local Government has circulated draft regulations making amendments to the local government scheme, the Draft LGPS (Miscellaneous) Regulations The majority of amendments are clarifications to the ill-health retirement and death benefits provisions, reflecting existing guidance or practice. Employers may wish to take note that it is proposed for the provision to buy back of pre 6th April 1988 co-habiting partner survivor benefits will now be available for 12 months after the nomination of a cohabiting partner. Provisions are made for notification of members whose benefit accrual exceeds the reduced Annual Allowance that came into effect from April 2011 and for recovery of Annual Allowance tax charges by adjustment to member benefits. Provision is also made for accommodating some of the requirements of Auto Enrolment and to make fees paid for counting officers duties for referendums pensionable in the same way as for retaining officer duties.. Consultation responses are required by 27th February 2012 and the draft regulations themselves, information about the consultation and a covering letter can be found via the following links: Draft Regulations: %28Misc%29%20Regs%202012%20.pdf Information About the Consultation: Covering Letter: Covering%20letter.pdf Alan Piper Pensions Specialist Manager alan.piper@lpfa.org.uk Strike Action: Pension Buy Back Information on the pension buy back following the strike action is available at under the Employers Section. Employers will also find a Strike Data Capture form which will assist in notifying LPFA of striking members who wish to buy back service. This can also be found at: This form can be located on the Home Page under the Latest News section. Emily Sanders Communications Advisor emily.sanders@lpfa.org.uk Reminder! You only have 30 days from the last strike date in order to buy back your pension.

5 Changes at LPFA - but business as usual During December 2011 there have been a number of changes made to staff involved in LPFA s agency clients. These changes have been made with improvements in service delivery in mind. Neil Lewins will now be supporting on the implementation of the new local government pension scheme and changes to the fire scheme. This is of vital importance for all clients and members. Having Neil supporting the rolling out of the new scheme will ensure a smooth transition and he will be drawing on all his experience in dealing with members and employers over the years. Lawrence Poster has left the organisation and the Assistant Managers in each agency will be carrying out the client liaison function. They are already very close to you and your customers and will continue to provide the service you expect. LPFA are recruiting for a Commercial Director to oversee all commercial activity and you will be kept updated on the appointment. In the meantime your first point of call will be the respective Assistant Managers. Natalie Christopher has been Deputy Manager for the last two years and will be in charge of London Borough contracts during the appointment process, with Toni Sawkins leading on the Fire Scheme. Please see the list of contacts below: Bexley - Ealing - Fire - Newham - Westminster Gary Wallace gary.wallace@lpfa.org.uk James Ahlberg james.ahlberg@lpfa.org.uk Toni Sawkins toni.sawkins@lpfa.org.uk Natalie Christopher natalie.christopher@lpfa.org.uk Douglas Ede douglas.ede@lpfa.org.uk For any access to online systems please contact: Nazmul Alam nazmul.alam@lpfa.org.uk I wish you all an enjoyable festive season and will be in contact in the new year. Susan Martin Deputy Chief Executive susan.martin@lpfa.org.uk