Cookies: We use cookies to give you the best possible experience on our site. By continuing to use the site you agree to our use of cookies. Find out more
House of Commons Hansard
x
Public Service Pension Scheme Indexation and Revaluation 2020
25 February 2020
Volume 672
The edit just sent has not been saved. The following error was returned:
This content has already been edited and is awaiting review.

Legislation governing public service pensions requires them to be increased annually by the same percentage as additional pensions (state earnings related pension and state second pension). Public service pensions will therefore be increased from 6 April 2020 by 1.7%, in line with the annual increase in the consumer prices index up to September 2019, except for those public service pensions which have been in payment for less than a year, which will receive a pro-rata increase.

Separately, in the career average public service pension schemes introduced in 2014 and 2015, pensions in accrual are revalued annually in relation to either prices or earnings depending on the terms specified in their scheme regulations. The Public Service Pensions Act 2013 requires HM Treasury to specify a measure of prices and of earnings to be used for revaluation by these schemes.

The prices measure is the consumer prices index up to September 2019. Public service schemes which rely on a measure of prices, therefore, will use the figure of 1.7% for the prices element of revaluation.

The earnings measure is the whole economy year on year change in average weekly earnings (non-seasonally adjusted and including bonuses and arrears) up to September 2019. Public service schemes which rely on a measure of earnings, therefore, will use the figure of 4% for the earnings element of revaluation.

Revaluation is one part of the amount of pension that members earn in a year and needs to be considered in conjunction with the amount of in-year accrual. Typically, schemes with lower revaluation will have faster accrual and therefore members will earn more pension per year.

The following list shows how the main public service schemes will be affected by revaluation:

Scheme

Police

Fire

Civil Service

NHS

Teachers

LGPS

Armed Forces

Judicial

Revaluation for Active Member

2.95%

4%

1.7%

3.2%

3.3%

1.7%

4%

1.7%

[HCWS123]