2015 Remedy (McCloud) - Public consultation for 2nd stage of the remedy
New Northern Ireland Civil Service Pension Scheme regulations are needed for the second part of the 2015 Remedy (McCloud) to address the age discrimination of Northern Ireland Civil Service Pension Scheme members. A public consultation has now launched on the new draft regulations. The consultation will be open until 12 noon on 2 June 2023.
You can find some Frequently Asked Questions and Answers here.
These new regulations will allow for the retrospective part of the remedy to take place. This will put right any unlawful treatment that has already happened whilst providing members with a choice about their pension benefits for the remedy period 1 April 2015 to 31 March 2022. This applies to benefits already in payment, as well as benefits that will become payable in the future.
The consultation document sets out how the regulations work in practice and explain the remedy choices that members will have and how these will work. One of the main changes is the returning of members who were moved to alpha on or after 1 April 2015 under the transitional protection arrangements, to their former Principal Civil Service Pension Scheme (NI) [PCSPS(NI)] pension arrangement for the remedy period. This is a requirement under the Public Service Pension Schemes and Judicial Offices Act 2022 (PSPJOA 2022) and puts all eligible members into the same position for the remedy period.
There are about 40,000 affected members, of which there will be a mixture of active, deferred, retired, and deceased members. You can find out if you are in scope for the 2015 Remedy (McCloud) by visiting the Civil Service Pensions (NI) website and using the Am I affected tool?.
The consultation is an opportunity for all affected scheme members or any other interested individuals and organisations to comment on the draft proposals before they are made final.
More information about 2015 Remedy (McCloud) can be found further down the page.
Background
The 2015 Remedy (McCloud) applies to members affected by the direct age discrimination introduced by the 2015 public service pension scheme reforms. This is sometimes known as the ‘McCloud’ judgment because of the ruling made in 2018 by the High Court against the Judges and Firefighters pension schemes in GB.
The remedy is made up of two parts. The first part was completed last year with all current active members of the Northern Ireland Civil Service Pension Scheme now being members of alpha. This will officially mark the ending of the age discrimination identified in the 2018 court judgment (the McCloud case) via the introduction of a single, Northern Ireland Civil Service Pension Scheme for all active members from 1 April 2022.
Legal Process
The aim of the combined legislation being introduced is to put members back into the position they would have been in, were it not for the identified age discrimination.
The PSPJOA 2022 legislates for how the discrimination identified by the courts in the way that the 2015 reforms were introduced for some members will be removed.
The Department of Finance will shortly be consulting on detailed changes needed to implement the McCloud remedy, which will be made through scheme regulations 'The Public Service (Civil Servants and Others) Pensions (Remediable Service) Regulations (Northern Ireland) 2023’ using powers in the Act.
Further legislation has been introduced to deal with some aspects of the remedy. This includes tax legislation and further Department of Finance Directions, as outlined below.
‘The Public Service Pension Schemes (Rectification of Unlawful Discrimination) (Tax) Regulations 2023’ which is designed, as far as possible, to put individuals in the tax position they would have been in had the discrimination being remedied not happened.
Directions provided by the Department of Finance, 'The Public Service Pensions (Exercise of Powers, Compensation and Information) Directions (Northern Ireland) 2023’.
Changes to Northern Ireland Civil Service Pensions under Remedy
In 2015 the government introduced reforms to public service pensions. Most public sector workers were moved into reformed career average pension schemes. For the Northern Ireland Civil Service this was alpha.
In 2018, the Court of Appeal found that the rules put in place in 2015 to protect older workers by allowing them to remain in their original scheme were discriminatory on the basis of age.
As a result, steps are being taken to remedy those 2015 reforms, making the pension scheme provisions fair to all members. Some active members will have seen changes from April 2022.
The remedy is made up of two parts. The first part was completed last year with all active members now being members of alpha from 1 April 2022, this provides equal treatment for all active pension scheme members.
The second part is to put right, 'remedy,’ the discrimination that has happened between 2015 and 2022. We are consulting on new scheme regulations and processes in readiness for this.
Over the coming months, we’ll be sharing more information and guidance to help you understand if you’re affected and what this may mean for your pension, but for now there’s no action you need to take.