Information for Academies

Since September 2010, a large number of schools have converted to academy status and many schools continue to do so. The guidance and information available from the Department of Education has changed over this period of time in relation to how they advise that Local Government Pension Funds treat these conversions. The current guidance can be found at

https://www.gov.uk/guidance/convert-to-an-academy-information-for-schools

It is important that any school considering a conversion is aware of the pension implications within the Local Government Pension Scheme (LGPS). We have explained some of the key points and procedures below.

Pension Position for Support Staff

At the date of conversion, all support staff will continue to be eligible for the LGPS, in the same way as they were immediately before the conversion date. The academy must automatically enter all new support staff that have a contract of three months or more into the scheme.  After conversion, any non-teaching staff that have previously opted out will be brought back into the LGPS from day one of conversion, but with the option to opt back out again.

All members who transfer under TUPE will have continuous pensionable service on the employment(s) that transfer.

Employee contribution bands remain the same across the LGPS, regardless of a change in employer.

In summary, there is no significant change from a member's perspective.

Things to consider

Accounts

An academy is required to include details of its pension liabilities as part of their annual accounts. This may be in the format of an FRS102 report, but the academy would need to contact their auditors for further clarification. This information can be obtained from the Pension Fund. There will, however, be a charge as this information has to be obtained from the Pension Scheme Actuary.

Administration arrangements 

Contacts

We require a point of contact, address, email address and telephone number for our Employers Database and for any queries there may be regarding your Scheme members. This will be requested from you by a member of the Pension Team.

Discretions Policy

As a Scheme Employer you will need to draw up your employer policy on the LGPS discretions. A .pdf template version of the document, which shows which discretions you have to decide upon, is provided below. This must be completed within 3 months of conversion.

PDF Document Pensions Discretions Template (630KB)

Internal Dispute Resolution Procedure (IDRP)

You will also need to select a person to investigate any Stage 1's of the Internal Dispute Resolution Procedure (IDRP).

Outsourcing

Where the outsourcing of services involves the TUPE transfer of any Academy employees who are members of or are entitled to be members of the Local Government Pension Scheme (LGPS), there will be Pension implications which should be considered as part of the tender process.

The Pension Fund has, unfortunately, experienced a handful of cases where Academies have let contracts and the Pension implications have not been considered at all or, if they have, it was too late in the process and led to unnecessary delays and complications.

When letting a new contact, under the Pension Fund’s new “pass through” agreement, employer contribution rates for contractors will be individually assessed in relation to each specific contract. The Employer rate will be based on the membership profile of the staff involved at the transfer date.

This is a significant change to the previous approach, which no longer applies, where the contribution rate was linked to the rate of the organisation letting the contract.

Therefore, if you are considering letting a contract (e.g. cleaning or catering services) to an external company, please contact the Pension Services who will calculate the LGPS employer contribution rate that the contractor will be required to pay. This should be included within any tender documentation you provide.

i-Connect

There are more and more complex demands on accurate and regular data updates as a result of the new Career Average scheme and increasing scrutiny on the accuracy of data by the Pensions Regulator. As a result, the Fund has taken the decision that all employers should submit monthly member data through a data portal known as i-Connect.

For any non-participating employers, there will be an administrative charge for the resources needed to administer active members of the Fund outside of the i-Connect process. The cost is likely to be in the range £1,932.00 pa to £32,908.00 pa, depending upon the number of members involved. 

"i-Connect" is part of Aquila Heywood group who provide the pensions administration system “Altair” currently used by the fund to administer the Local Government Pension Scheme.