Teachers’ Pension Scheme (TPS) Transition Remedy: important update

13 October 2023

TPS should, by now, have written to you via My Pension Online (MPO) if you are affected by the Transition Remedy, commonly referred to as ‘McCloud’.

On 1 October 2023, all pensionable service accrued by affected members during the RemedyPeriod was rolled back to the legacy final salary scheme.

There is nothing for you to do unless you purchased some of the CARE scheme flexibilities during the Remedy Period. Some of these can’t be rolled back so TPS will contact you with your options in due course. 

We have heard that some members are being contacted by third party organisations unrelated to TPS, offering to act financially and otherwise – do not engage with them. The Transition Remedy is designed as a no-detriment instrument which will allow you a free choice upon retirement. All your legacy accruals are fully protected, index-linked, and moreover, linked to real final salary.

On the contrary, the remedy reopens a couple of important, time-limited opportunities:
  • Affected members now a have another opportunity to buy-out any actuarial reduction (normally ~3%pa) between 65 and the Normal Pension Age (NPA) in the reformed CARE scheme. In other words, you can effectively reduce your NPA in the reformed scheme from the state pension age, down to your 65th birthday, at which point you take those benefits in full. Calculators on the TPS website will calculate the cost of doing this, remembering that any additional contributions will be tax free, deducted at source. This is only available for six months subsequent to rollback, so must be actioned by 31 March 2024. 
  • There is also a renewed opportunity to transfer-in any service from another public sector pension scheme, available until 30 September 2024.