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Ministers plan academy support staff pensions reform

The plans would simplify the process to transfer staff to the same fund, rather than having them spread out across different councils based on their school location

Freddie Whittaker

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Government is planning reforms to school support staff pensions that would make it easier for academy trusts to transfer all workers to the same fund.

At the moment, staff in the local government pension scheme (LGPS) in an academy are automatically part of the fund for their local area, or 鈥渁dministering authority鈥, run by the council.

In a consultation , the Ministry of Housing, Communities and Local Government (MHCLG) said the current system meant trusts 鈥渙ften have academies spread across multiple administering authorities鈥.

This 鈥渃an be inefficient and cause unnecessary administrative costs for employers鈥.

Trusts can already apply for a “direction” from the communities secretary to switch a school to a different administering authority.

New criteria to be created

The government raised the example of an academy in South Shields whose trust is based in Barnsley.

Its local government pensions would automatically fall under the Tyne and Wear Pension Fund. But the trust can apply to move responsibility to South Yorkshire Pension Authority, which covers Barnsley.

The government is proposing to create new criteria and remove sign off from government on each transfer, with some exceptions.

The current lack of criteria 鈥渕akes it difficult for employers and administering authorities to know how to construct their case and what the process will be for assessment鈥.

‘Weigh benefits against risks’

While moving to one council “may bring benefits” to MATs, it should be weighed against “risks of consolidation at the local level, in particular the transfer of assets and member records,” MHCLG said.

The criteria will therefore require MATs to have a 鈥渃lear and evidenced value-for-money assessment in favour of the consolidation鈥.

There should also be a 鈥減re-existing relationship with the administering authority that the MAT wishes to join or consolidate into鈥.

All administering authorities involved 鈥渟hould agree to the change鈥. And the receiving council 鈥渕ust be able to administer the transfer effectively鈥.

Sign-off from government won’t usually be needed

The government said it also wanted to 鈥渟pecifically鈥 limit 鈥渟o-called 鈥榗ontribution rate shopping鈥, where an employer is seen to select the administering authority primarily based on where it can get the lowest contribution rate鈥.

For situations where all of the criteria are clearly met, the government 鈥減roposes to remove the requirement to seek secretary of state consent鈥.

鈥淭he majority of applications received are straightforward and clearly meet all of the criteria above.

鈥淚n line with the government鈥檚 desire for greater devolution, we believe that secretary of state consent is unnecessary in this situation and administering authorities and employers should be able to take decisions locally.鈥

The government said this would mean administering authorities and employers 鈥渃ollaborating at the local level鈥.

But ministers will step in if councils disagree

Ministers also plan to step in if all sides can’t agree on the transfer. Decisions can be reviewed by government, but it expects “this will be very rare”.

When the criteria are not met, the government 鈥減roposes that applications to the secretary of state will continue to be required.

鈥淏ased on recent applications for directions, this would most likely be situations where the current administering authority does not agree to the transfer.鈥

The government said it supported applications for directions to consolidate within a single administering authority, 鈥渨here analysis shows that benefits clearly outweigh the costs in a particular case鈥.

Jon Richards
Jon Richards

It also “wishes to avoid that an administering authority can veto otherwise sensible consolidation.

“Whilst government understands that no administering authority wants to lose the active members, it is for government to arbitrate in cases where local agreement cannot be reached.鈥

UNISON assistant general secretary Jon Richards said: “These are sensible proposals potentially. They should help to reduce admin costs, while simplifying membership arrangements for school support staff and employers.

He said it would be “important for trusts to consult unions locally before they go ahead.

“School support and council staff must retain easy access to a high-quality, defined benefit pension scheme. Many LGPS members are low-paid, and employers are struggling to recruit and retain staff on current wages. High-quality pensions act as a recruitment tool.”

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