McCloud Pension Remedy Update

From 1 October 2023, eligible members of the Firefighters' pension scheme will be given choices about the benefits they receive for service between 1 April 2015 and 31 March 2022. This is the Remedy Period and these choices are referred to as ‘remedy’ – you may have also heard them called the ‘McCloud’ remedy.

The regulations that govern this exercise have now been laid and come into force from 1 October 2023.

What is the remedy?

In April 2015 a new pension scheme (called the FPS 2015) was introduced. Most members moved to this new scheme in April 2015. As part of the roll out of the new scheme, members closest to their normal pension age were given ‘protection’ and remained in their legacy scheme after April 2015. This protection period ran from 1 April 2015 and ended for all members at 31 March 2022. This time period is now known as the ‘Remedy period’.

After a legal challenge, the courts determined that these protections were age discriminatory and not fair to all members of the pension scheme i.e. younger members in the scheme were missing out on additional years of benefits from the original pension schemes.

Who is eligible for the remedy?

Not all members are affected by the remedy period. Members that are eligible must:

• Have been in pensionable service on or before 31 March 2012

• Had pensionable service between 1 April 2015 and 31 March 2022

• Not have a gap in service of 5 years or more (known as a disqualifying break)

Pensionable service does not have to have been in the Firefighter's Pension Scheme, it could also have been in another relevant public service pension scheme.

When will I hear more about remedy?

• If you retired during the Remedy Period, XPS pensions will contact you with more information. This could be anytime between October 2023 and March 2025. Please note that those members who retired under ill health, passed away or had tapered/no protection will be prioritised. Due to the large number of cases involved, we cannot confirm any timescales at this point. 
  
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• If you are still in service and a member of the pension scheme, you’ll receive further information from XPS pensions next August. You don’t need to take any action now.
  
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  If you have left the service, but are not yet retirement age, you will hear from XPS pensions between October 2023 and March 2025 about your choices. 
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• If you are in service but intend to retire before August 2024 when you tell us you are going to retire, XPS pensions will provide you with an Remediable Service Statement (RSS) before you retire. This will lay out your choice of benefits. Please provide at least 3-6 months’ notice to ensure your benefits are calculated and you can have a choice when you leave.
  
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In September and October we will be writing to you to confirm if you are in scope for the remedy, and over the coming weeks and months more details will be added to this page. 

Can I get a remedy estimate?

From October 2023, XPS pensions will begin to work through cases for anyone who has already retired. A lot of the work they will need to do will be manual, therefore they will have limited capacity to provide remedy estimates at the moment. However, they have advised that they will complete estimates for any members who are due to retire within 6 months. 

If you have any questions please email your query to pensionremedy@cheshirefire.gov.uk

How much interest will I pay, or will be due to me?

It is not possible to tell you at this stage what interest you will owe, or how much interest will be added if you are due a refund. Interest is calculated on the basis of dates which can vary, such as when you will make a payment, or when you will receive your RSS. As these dates are not yet known, it isn't possible to give you any exact figures at this time. 

Where money is owed to the scheme compound interest based on the NS&I Equivalent Savings Rate is charged. These rates vary from year to year. Where the scheme owes money to you, simple interest based on the Judgements Act will be added. This is currently 8%. Depending on the reason for the payment, interest may be taxable.

We have provided some indicative figures below based on some basic scenarios. 

Example Contribution Adjustments