Tuesday 1st November 2022
Why The Forces Pension Society is pressing the Government on issues concerning your pension: Maj Gen Neil Marshall, CEO, Forces Pension Society
The two big issues affecting Armed Forces Pensions
The first you will be aware of, and that’s the 2015 Remedy (McCloud). The Society pressed government not only to correct their mistake but to choose the remedy that will work best for Forces personnel. Our efforts were successful, resulting in Deferred Choice Underpin being selected, putting you in the best possible position to make an informed choice at the point of your departure. But the implementation of the remedy is highly complex and meeting the October 2023 deadline is proving challenging for the Government to achieve. We will monitor this closely, continue holding the Government to account and reporting on progress.
The second issue is about who pays for the Government’s initial mistake
When AFPS15 was introduced, a cost-control mechanism (CCM) was established to ensure Public Services Pensions were maintained within a fixed range (+/- 2%) to protect taxpayers and scheme members alike. The latest calculation found that the cost of member benefits has fallen by 4.1% of pay, and an improvement to the 2015 Scheme for the Armed Forces was agreed. But this was suspended whilst Government considered the consequences of the costs associated with the 2015 Remedy.
Government now wants to include these costs (estimated at £17Bn) within the CCM calculations, denying members’ previously agreed improvements to their benefits. In effect, this could mean that those serving our country will have smaller pensions in order to pay for the Government’s error. A judicial review is being undertaken to resolve the dispute.
The Society’s view is that both the letter and the spirit of the previous agreements means this Government should do the right thing now and absorb the costs of the 2015 Remedy.
If you want to find out more about the Forces Pension Society’s work and how you can become a Member, visit the website.