TfL pension proposal deadline moved to February
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A detailed proposal for the future of the TfL Pension Fund will not be agreed until the end of this month, after the government asked for an extension to the previous deadline of 31 January.
On 20 January, Emma Ward, director general for roads and local group in the Department for Transport, wrote to the TfL interim commissioner Andy Lord, saying that the implementation plan would need to be delayed.
TfL’s independent experts had produced a report with four options for reform of the fully funded scheme without recommending any one in particular.
The options outlined in the report are:
- The current defined benefit final salary arrangement (do nothing)
- An amended final salary arrangement
- A defined benefit career average revalued earnings arrangement
- A defined benefit CARE plus tiered contributions arrangement
Asking for a delay in plumping for an option, Ward wrote: “Given the complexities of the options and the potential implications for wider government, the secretary of state has agreed an extension of the 31 January deadline, in order that government can give the options further consideration. The revised date for TfL and the Mayor to agree with HMG a final proposal is now 28 February 2023.”
Central government made funding for TfL conditional on reviewing the future pension provision. TfL has previously said however that the main risk is not in future but in past service benefits, and suggested that this would require either:
- government support for legislation to enable a transfer of past service assets and liabilities to a new or existing funded or unfunded public sector arrangement in order to reclassify the Scheme as a public sector scheme; or
- government provision of a crown guarantee similar to that enjoyed by BT.
Transport unions have been staging a number of strikes over several months including over pensions. The RMT union said it opposes changing the pension scheme and would "use every weapon” at its disposal to fight possible cuts.
Which option might TfL and government agree on for the pension fund? Could a decision be delayed until the next general election?
