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The last Labour Government introduced reforms to public service pension schemes, with the aim of improving financial sustainability and reflecting changes in life expectancy, working practices and the private sector. They included increases in the pension age for new entrants.

After the 2010 election, the Coalition Government set up the Independent Public Service Pensions Commission, chaired by former Labour Work and Pensions Secretary, Lord Hutton of Furness, to conduct a review of public service pensions. In its interim report in October 2010, the Commission said reforms to date had not gone far enough in responding to demographic change and did not significantly reduce current costs to taxpayers.

The Commission’s final report in March 2011 recommended replacing the existing public service pension schemes with new ones by 2015. In most of these new schemes, members’ normal pension age in the new schemes would be linked to their State Pension age (SPA). It said this link should be regularly reviewed, to make sure it is still appropriate, with a preference for keeping the two pension ages linked. For the ‘uniformed services’, the Commission recommended a normal pension age of 60, to be kept under review.

The Coalition Government accepted the Commission’s recommendations as the basis for negotiation with the trade unions. It legislated in the Public Service Pensions Act 2013 for a framework for the new schemes to be introduced for future service from 2015 (2014 for local government).

Section 10 of the 2013 Act provided that individuals in the new schemes would have a normal pension age linked to the State Pension age, except for the new schemes for firefighters, police and armed forces, which have a normal pension age of 60.

The link to the State Pension age caused widespread concern among public sector unions, some of whom launched a ‘68 is too late’ campaign. An area of particular debate was the impact on certain groups – such as paramedics, prison officers, MoD police and firefighters and Civil Nuclear Police – given the demands of those roles.

However, there was also concern about a pension age of 60 for some members of the ‘uniformed services.’ The Fire Brigades Union, for example, argued that this was too high and that any change should be dictated by the required age-profile of the service rather than life-expectancy in retirement.

Transitional protection arrangements in section18 of the 2013 Act enabled those ‘closest to retirement’ to remain in their existing scheme either until retirement or for a limited period, depending on their age. In December 2018, the Court of Appeal ruled in McCloud v Ministry of Justice that the ‘transitional protection’ offered to some members as part of the reforms amounted to unlawful discrimination. The Government said in July 2019 that, although the court’s judgement was in relation to the schemes for the judiciary and firefighters, the difference in treatment would need to be remedied across public service pension schemes. For more detail, see Library Briefing Paper CBP 5768  (December 2019).

For more on the background, see SN 2209 Public service pension age – the Labour Government’s reforms (November 2018).

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