Date posted: 01/02/2010

Audience: This Notice is for the immediate intention of:

  • Finance Directors and Managers involved in the preparation of resource accounts.


  • Ensure that a copy of this document is issued to each member of staff that is involved in the preparation of the Remuneration Report, and that it is read and understood by them.
  • Send the note at Annex 13D to all senior management reported on in departmental Remuneration Reports. This does not include Ministers.
  • Replace Section 13 of the Employers’ Pension Guide (EPG) with the attached pages.

Timing: You must apply this guidance when you prepare the resource accounts for 2009-2010.You should discuss timings with your pensions administrator as soon as possible.

The Remuneration Report

  1. Resource accounts must include a ‘Remuneration Report’, which contains information about the pay and pension packages of Ministers and the senior management team*. The Remuneration Report should include information about your remuneration policy and the individual’s contract of employment (service contracts). As well as salary and pension information it must also include detailed information about compensation paid to senior management. Disclosure of compensation information, unlike salary and pension, can only be made after you have told the individual and shown them what you plan to publish.

Disclosure of salary and pension information

  1. Following a decision by the Information Commissioner in 2006, salary and pension information about an individual can be disclosed without their permission. All such information must be disclosed in Remuneration Reports, unless the member argues, giving reasons, that publication would prejudice their rights, freedoms or legitimate interests, or that it would or be likely to cause unwarranted substantial damage or distress to themselves or another. If a member raises such an argument (under section 10 of the Data Protection Act (DPA)) you must consider whether to accept it. You are strongly advised to take legal advice in such a case, because if you decide not to publish this may be challenged under the Freedom of Information Act. You can also find further details in the Government Financial Reporting Manual (FReM) paragraph 7.2.26.

Disclosure of Compensation

  1. Before disclosing compensation paid to a member of your senior management team you must:
  • Notify the individual concerned that you propose to publish details of the benefits they received;
  • Invite them to see what you intend to publish in the report; and
  • Tell them that they can make a case for non disclosure under s10 of the DPA. 1

*Please note that references to ‘senior management’ that follow in this EPN are taken to mean members of your most senior management team only (i.e. board members).

  1. If a member objects to disclosure of their compensation payments, they must explain why disclosure is likely to cause them substantial and unwarranted damage or distress. They can not merely say that they refuse permission. You will need to take legal advice on whether the individual’s arguments satisfy the exemptions under the DPA. If the member is successful in arguing that disclosure should not take place, you should not refer to it in the Remuneration Report.
  2. Annex 13D includes a note for you to send to senior management to tell them of the arrangements for disclosing compensation payments and their right to object under the DPA. It is important that this notice is also issued to any new senior management if they are likely to be included in the Remuneration Report.
  3. Ministerial severance payments are made under statute, outside of the Civil Service Compensation Scheme arrangements, and are not covered by this guidance.
  4. As employers, it is your responsibility to describe the full implications of any compensation paid out. This must include ALL monies paid out to the member both at the time they left and any future payments payable to them as part of their compensation package. See Annex 13C for an example of the narrative. You should explain in a footnote that the cost of the compensation to you as the employer may not be exactly the same as that paid out to the member. Annex 13C is an example of what a Remuneration Report might look like. Please note that you should not make changes to the notes explaining pension benefits without the agreement of the Cabinet Office.

Compromise agreements

  1. Where you have a compromise agreement with an individual, which contains a confidentiality clause, information about their compensation is not normally disclosed. However, it is possible for disclosure to take place in exceptional circumstances and with an individual’s express permission. Wherever a compromise agreement exists you should always obtain legal advice.


  1. The forms Annex 13A and 13B should be used to request the pensions and compensation information you require for your accounts from your pensions administrator, and the pensions information you require for your accounts from the House of Commons (HoC) Pensions Unit (see Annex 13B). You should send your request as soon as possible so that they can ensure they have all the data they need on the individuals concerned. Pensions administrators will not be able to start calculations until they have updated the pension records to reflect the March payroll. It is therefore essential to discuss with your pensions administrator when your figures will be available
  2. Employers are responsible for identifying the individuals for whom disclosure information is required. Employers must request pension information from their pensions administrator using the Annex 13A. On receipt of the Request Form, the pensions administrator will carry out the necessary pension calculations and enter the details in the relevant boxes in the Request Form. The form is then returned to the employer contact for their action.


  1. You must enter an up to date salary for the member and an accurate figure of the contributions paid by the member. You will have to contact your payroll to provide you with this information. . If you do not supply this information promptly you will delay your pensions administrator from getting the information back to you. You should include as salary: gross salary; performance pay or bonuses; overtime; London weighting or allowances; recruitment and retention allowances; private office allowances; ex-gratia payments; and any other taxable allowances or payments. The payment of legitimate expenses is not part of the salary. You must send the completed Annex 13A to your pensions administrator.
  2. The pensions administrator will not process your calculations unless the information is sent to them on a fully completed Annex 13A. Once the pensions administrator has received the fully completed Annex 13A, it will take them some time to return the completed calculations to you. Please contact your pensions administrator to discuss these timescales. You are responsible for the security of sending the Annex 13A to the pensions administrator so please ensure that you are following your department’s guidelines.

Earnings Cap

  1. If you had any members during the 2008-09 accounting period who were subject to the earnings cap but who had transferred-in service that was pensioned without regard to the earnings cap, it is possible that their CETV calculation was incorrect. If this was the case you will have to put a note in the 2009-10 resource accounts correcting the previous year’s error. See Annex 13C for an example of how this is worked out, pensions administrators have been told about this issue and will make the calculations for you.

Partial Retirement

  1. Under the scheme rules, people may take partial retirement if they reshape their job so that their pensionable earnings are reduced by at least 20%. On partial retirement they may draw all or part of their pension and their accrued benefits/reckonable service are adjusted accordingly.
  2. For the purposes of disclosure, someone who has taken partial retirement will be reported as having a mix of active and pensioner benefits. This disclosure should be made both in the year when partial retirement happens and in subsequent years.

Reporting year in which partial retirement takes place

  1. The start-of-year figures will be displayed as normal but the end of year figures will reflect a mix of active and pensioner membership benefits:


Member 2 has taken partial retirement from 1 December 2009 and he draws a pension of £43,572 and a lump sum of £130,716. (These figures must reflect any commutation decision and reflect the award sent to Capita Hartshead. However, if there was a pension share against the member then the figures reported must be pre-debit.)

At the end of the scheme year Member 2 has accrued benefits not yet in payment of £290 pension and a lump sum of £870. Add the pension/lump sum paid and the pension/lump sum accrued, but not yet in payment, together. You will receive the completed Annex 13A from your pensions administrator as below.

Row 10 Pension at ED (£) £43,862, of which £43,572 is in payment
Row 11 Lump sum at ED (£) £131,586 of which £130,716 has been paid

Subsequent reporting year(s)

  1. It should still be noted in the Remuneration Report that a member has taken partial retirement and the amount of any pension and lump sum taken. This information should be published as a footnote in the Remuneration Report for as long as the member is being reported on.
  2. The lump sum disclosed for the 'active' element not yet in payment will only apply to members in classic and classic plus as per normal.

Disclosure of other pension information

  1. You should continue to disclose the information about retirement benefits, required by section 8 of the FReM, as a note to the resource accounts.


  1. There are many reasons that would cause a negative value in the “real increase in CETV” including:

i. If a rise in pensionable salary is less than the rate of inflation;

ii. If someone joined or left mid year:

iii. In classic plus the lump sum for service up to 30.9.02 will always give a negative value

iv. The pension factors for the over 60s decrease the value of the pension that could have been taken at 60.


This document replaces EPN240


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1 February 2010
Last updated:
24 April 2023