Local Government Pension Scheme in England and Wales - Access and Fairness

Club transfers are where members transfer pension benefits between certain schemes who have joined the Public Sector Transfers Club. Regulation 14(3) of the 2023 Regulations – Interest on payments under the statutory underpin – says that “an administering authority must take reasonable steps to pay interest in respect of the amount to be paid to the scheme under regulation 10(5) (transfers out)”, but this is contrary to the Public Sector Transfer Club Memorandum as issued by the Cabinet Office. The Club Memorandum at paragraphs 4.41 and 4.22 states that interest should not apply on Club transfers, except where the transfer was completed before 1 October 2023 and the receiving scheme was not a “remedy scheme” (i.e., a scheme subject to the McCloud remedy).   

The government proposes to remove this inconsistency, and confirm that interest should not apply on such transfers, except where the transfer completed before 1 October 2023 and the receiving scheme was not a remedy scheme. This would require an exception to Regulation 14(3).