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EPN508 – Appointment of a new Defined Contribution Pension provider for Civil Service Pensions

Audience

  • Pension leads
  • HR Managers
  • Finance Managers
  • Payroll Managers

Actions

  • To advise Defined Contribution (DC) scheme members of the member consultation exercise
  • To advise unions representing scheme members of the consultation exercise
  • To note the potential impact of the transition on employers and payroll providers
  • To note the potential impact of the transition on scheme members

Timing

  • Immediate

Detail

1. In EPN460 (12 August 2016) we advised that Cabinet Office, as Scheme Manager, had decided to move to a single DC provider and a procurement exercise was to be undertaken.

2. This notice is to confirm that Legal & General has been selected as the preferred provider (subject to member consultation).

3. The procurement competition was only in respect of the defined contribution pension schemes and does not affect the defined benefit schemes.

Member Consultation

4. The decision is subject to member consultation and the consultation is open from midday 25 September 2017 until 11pm on 25 October 2017.  The consultation document can be found using this link.

5. We have published a notice on the member section of the website. However in order to ensure that as many current scheme members as possible participate, please encourage your employees to take part.

Advising unions of the member consultation exercise

6. The Cabinet Office will consult with Public and Commercial Services union, FDA, Prospect, POA, Unite and GMB via the Joint Superannuation Committee (JSC), which is a sub-group of the Scheme Advisory Board. 

7. If there are any unions who you feel need to be informed of the proposed changes. Please advise them of the proposal and provide a copy of the member consultation document to them.

Potential impact of planned transition activity on employers and payroll

8. If the transition goes ahead, payroll amendments will be required to enable contributions to be sent to the new provider.   We will provide details of the proposed changes, following completion of the consultation exercise, which we expect will be no later than 17 January 2018.

9. Partnership scheme members receive employer contributions in line with the agreed schedule.  There are no changes planned to the level of contributions payable by employers.

Potential impact of planned transition activity on scheme members

10. If the transition goes ahead, the changes for members will be as follows:

Scheme

This is the approach we expect to take

Additional Voluntary Contribution

Future contributions will move to the new provider from September 2018.

Existing pension funds held with the current providers will be transferred to the new provider by October 2018.

The changes will not be implemented where the change would cause financial detriment. All members will be given the option to opt-out of the transfer of their existing pension funds.

 

Partnership Pension Account

Future contributions will move to the new provider from September 2018.

Members will be offered the option of transferring their existing pension fund to the new provider by October 2018.

 

Stand-alone Stakeholder

The stand-alone stakeholder scheme will no longer be offered, however, members will be able to join the AVC scheme from September 2018 if they wish. 

Members will also be offered the option to transfer their existing Standalone Stakeholder to the new provider by December 2018.

 

11. Cabinet Office, as Scheme Manager, will write to scheme members in July 2018 to advise how the changes will affect them personally.

Other information

If you require further assistance on the content of this EPN please contact DC.Provider@cabinetoffice.gov.uk

If you have a question about the distribution of EPNs contact employerpensionnotice@cabinetoffice.gov.uk

This notice is for employers and should not be issued to scheme members.  If members have a question about their pension they can find information on the Partnership, CSAVC and Stakeholder webpage http://www.civilservicepensionscheme.org.uk/members/partnership-csavc-stakeholder/.