In August, the participation rules of the Teacher Pension Scheme were changed. The change has been brought in to allow for schools’ phased withdrawal from the scheme’s independent sector. Without this change, the schools might otherwise have fully left the Teacher Pension Scheme.
The introduction of phased withdrawal allows for the freezing of membership within a phased withdrawal school at that point in time. No new entrants will be allowed to join the scheme unless there is a bulk TUPE transfer from a participating school.
What does this mean for teachers?
If you are a teacher in a school currently paying contributions in the Teacher Pension Scheme, you will remain an active member when the school withdraws from the scheme. You will experience no changes to your pension status except where you choose to opt-out of the scheme or leave employment. If you join a school that has opted out of the Teacher Pension Scheme, your employer must offer you an alternative pension.
A teacher in such an independent school must update your contact details with TPS to be contacted if a phased withdrawal occurs. At this point, the Teacher Pension Scheme will contact individuals to explore the personal impact of the changes.
Into the future
The Teacher Pension Scheme will offer a separate section on the website for those within a school that has withdrawn. Your status as part of a phased withdrawal can be explored there or through the help sheets available.
If you are concerned about what this means for you, it is good to speak to your employer or an independent financial adviser.
The content in this article was correct on September 26th, 2021. You should not rely on this article to make important financial decisions. Teachers Financial Planning offers advice on pensions for teachers and non-teachers. Please use the contact form below to arrange an informal chat with an advisor and see how we can help you.