Employer Focus - November 2020
This bulletin from the Staffordshire Pension Fund, focuses on current issues that you should be aware of relating to the Local Government Pension Scheme (LGPS).
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If you wish to print out this information, please select the document below:
Coronavirus job retention scheme - furlough Back to top
The Pension Fund needs to be aware if any scheme members are furloughed, in order that any earlier pay protection can be considered should the member leave within 12 months of the furlough period ending, and also to avoid the Pensions Section needing to contact your payroll teams regarding unexpected reductions in the member's remuneration.
A simple spreadsheet return is available on our website, which should be completed at the beginning and the end of the furlough period.
The completed forms should be sent to:
Further information
To further assist employers, see the Local Government Association (LGA) website which contains all the latest information including Covid-19 webinars for LGPS employers and frequently asked questions.
In previous communications we have kept you informed about the McCloud case and the implications for the Local Government Pension Scheme (LGPS) and the additional requirements this will place on employers and the Pension Fund.
To assist employers, we now have a dedicated webpage on the Fund’s website. The webpage provides employers with all the latest information, which includes the employer’s regulatory requirements to comply with the McCloud judgement.
Establishing key employer contacts
As mentioned previously, the key to successfully completing this exercise is that the Fund and employers work together closely and in partnership. The first step in this project is for us to establish a key employer contact for Fund officers to liaise with. This person would ideally be in position of responsibility from within your HR or internal payroll team.
Please note: this is an employer responsibility and whilst you may delegate the collection of data to a third-party payroll provider. The key employer contact who we will liaise with must be employed from within your organisation.
If you haven’t already done so we would be grateful if you could nominate a person from within your organisation and provide the following details to pensions.comms@staffordshire.gov.uk
- phone number and/or work mobile
The £95,000 exit payment cap - effective from 4 November 2020 Back to top
Please note: the exit payment cap applies to all public sector employees and employers including councils (metropolitan, county, district, borough) police and fire authorities and academies.
You can check if the exit cap regulations apply to you as an employer by looking at the list of all employers who are subject to the exit payment cap.
Following the introduction of the £95,000 exit payment cap regulations which came into force on 4 November 2020, the Local Government Association (LGA) have published an information note for employers on the exit payment cap (external link to a PDF document).
The LGA guidance sets out the various steps that employers should consider for redundancy and business efficiency exits that occur from 4 November 2020 until the LGPS regulations are changed to accommodate the exit payment cap.
Please note: the guidance applies to exits of LGPS members who are aged 55 and over.
It is particularly important that you maintain close contact with the Staffordshire Pension Fund throughout the retirement process, for any individuals who may be affected by the exit payment cap.
Further information on the exit payment cap is available on our website.
September 2020 consumer price index Back to top
On 21 October 2020, the Office of National Statistics announced that the consumer price index (CPI) rate for September 2020 was 0.5%. Pensions increases and revaluation of members career average revalued earnings (CARE) pension accounts next April (2021) normally follow the September CPI increase.
LGPS Funds - England and Wales 2019/20 Back to top
Every year the Ministry of Housing Communities and Local Government (MHCLG) publishes statistical information on LGPS Funds' expenditure, income and membership for the financial year for England and Wales. On 4 November 2020 they published the statistics for the financial year 2019/20.
The highlights include:
- total expenditure of £13.4 billion, an increase of 5.6% on 2018/1
- total income of £16.0 billion, an increase of 2.6% on 2018/19
- employer contributions increased by 7.7% on 2018/19 to £7.7 billion
- employee contributions increased to £2.3 billion from £2.2 billion in 2018/19
- the market value of LGPS Funds in England and Wales on 31 March 2020 was £272.4 billion, a decrease of 5.1%
- there were 6.1 million scheme members on 31 March 2020, 2.0 million active members, 1.8 million pensioners and 2.2 million deferred members
- there were 88,232 retirements in 2019/20, an increase of 5.7% compared with 2018/19
If you require any further information or clarification, please do not hesitate to get in touch: