NHS pension reform: deadline of 1 October 2009

30 September 2009

NHS Pensions reform

The NHS Pension Scheme has been split into two sections. People in the NHS pension scheme on or before 31 March 2008 are in the “1995 section”, even if they joined before 1995. Those who joined from 1 April 2008 are in the “2008 section”. The two sections are separate and provide different pension arrangements to NHS staff. By and large the “2008 section” is markedly less beneficial than the “1995 section” benefits.

The “NHS Pension Choice” exercise has been launched by the Government with the aim of offering the benefits of the “2008 section” to “1995 section” members. “1995 section members” who wish to transfer into the “2008 section” are eligible to do so until 1 October 2009. After 1 October 2009, NHS Pensions (via NHS employers), will write to all eligible members of the 1995 Section of the NHS Pension Scheme to let them know that they will have the option of transferring to the 2008 Section.

Comparison of section benefits

Members of the “1995 Section” will be provided with a pack of information and comparison statement of the benefits they might expect to receive from a comparison with the “2008 Section” in order to illustrate the benefits of the latter section, should they choose to transfer. The pack will be referred to as the “Choice Pack”. Within the “Choice Pack” there will also be information to help members when making their choice, including a “Choice Guide” and a “Choice DVD”.

Voluntary transfer

The choice is voluntary and no member of the “1995 section” can be forced to move into the “2008 section”. “1995 section” members need not do anything. However, NHS Pensions will expect “1995 section” members to make a choice about which part of the NHS Scheme they want to be a member of, in the first few months of 2010.

TUPE or TUPE like transfers – urgent action

NHS employers need to identify staff that may be part of a TUPE or TUPE like transfer on or after 1 October 2009 to an employer who cannot offer membership of the NHS Pension Scheme. Failure to carry out the NHS Pension Choice Exercise for such staff before employment is transferred could leave employers open to a challenge under the Occupational Pension Scheme Disclosure Regulations. These Regulations state that where an employer fails, without reasonable excuse, to comply with any requirement imposed parts of these Regulations; they could be subject to a fine of up to £10,000. The Regulations set out minimum information requirements that pension scheme members must have. In this case, it is the information about the NHS Pension Choice Exercise.

Further information

Hill Dickinson has a specialist pensions lawyers within the NHS Employment team. For further information please contact Andrew Ashley-Taylor at andrew.ashleytaylor@hilldickinson.com. You can also obtaina series of leaflets for your staff and explanatory notes by contacting Andrew. Leaflets include:

• Your NHS Pension Choice NHS Employer Frequently Asked Questions
• Which NHS pension path will you take?