Remediable pension saving statements: further delays for NHS Pension Scheme members

Pension schemes can be complex and are seldom straightforward. For members of the NHS Pension Scheme, the delays in providing remediable pension saving statements to affected members have added another layer of uncertainty.

The McCloud judgment: a brief overview

To understand the significance of the current delays, we need to revisit the McCloud judgment. The McCloud case found that the transitional protection offered to certain members of public sector pension schemes during the 2015 reforms was age discriminatory. This resulted in eligible members being allowed to choose between the old and new pension scheme benefits for the period between 2015 and 2022.

Impact on the NHS Pension Scheme

The NHS Pension Scheme, like many other public sector schemes, was affected by the McCloud judgment. In response, the NHS Business Services Authority (NHSBSA) was tasked with issuing remediable pension saving statements to affected members. These statements were intended to provide information on the benefits accrued under both schemes, so that members could make an informed choice.

Initial delays and current situation

The process of issuing the remediable pension saving statements has been fraught with delays from the outset. Initially, this was expected to be completed by 2023, but the timeline has been pushed back multiple times. As of now, the NHSBSA has announced even more delays, citing the complexity of the task and the need to ensure accuracy in the statements.

Firstly, the sheer volume of data to be processed is immense, given the large number of NHS Pension Scheme members. Additionally, making sure that the data is accurate, and reflects the correct pension benefits accrued under both schemes, is a meticulous process. Many of the statements already issued have had to be revised due to the information on them being incorrect, causing further delays and uncertainty.

What does this mean for NHS Pension Scheme members?

Completing tax returns

Without the statements, members are unable to complete their submissions to HMRC to confirm their tax positions for the affected period. Members may have additional liabilities to pay or be due refunds, but without the statements, the revised positions cannot be sent to HMRC.

HMRC still state that it’s an individual’s responsibility to make sure that their self-assessment tax returns are complete and correct. For 2023/24 onwards, this includes any annual allowance tax charges. Without the statements being made available, it’s difficult for members to accurately calculate whether there’s an annual allowance tax charge to report on their returns. HMRC, however, still expect charges to be reported which means that provisional returns need to be submitted and the charges to be revised later.

Financial planning and retirement decisions

For many NHS Pension Scheme members, these delays are affecting their financial planning and retirement decisions. Without the remediable pension saving statements, members are left in a state of uncertainty because they’re unable to accurately calculate their pension benefits and plan accordingly.

What happens next?

Revised timelines

While the exact timeline for the completion of the remediable pension saving statements is uncertain, the NHSBSA has said that they are working to expedite the process.

Statement provision

HMRC have set a deadline of three months from the date of the statement to submit the details to them via their online tool. It’s important that you review the statement for inaccuracies or seek professional advice as soon as you receive your statement. The statements are sent by post, so make sure that NHS Pensions hold your correct address.

Cost claim back

Members can claim back costs of professional fees to deal with the application of the McCloud remedy. This is up to £500 for financial advice and up to £1,000 for accountancy support. This allows members to seek professional advice knowing that they’re able to reclaim costs for doing so.

Need help?

If you work in the medical sector and need guidance on how this may impact you, Larking Gowen is here to help. Please get in touch with your usual Larking Gowen contact. You’ll find details on the Our People section of the website. Alternatively, you can call 0330 024 0888 or email us at enquiry@larking-gowen.co.uk.

George Crowe