McCloud delay at SPPA highlights administrators' struggle to meet timetable
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The Scottish Public Pensions Agency has come under fire for repeated delays to delivering the McCloud remedy as public service schemes are struggling to meet timelines.
The so-called ‘McCloud’ remedy must be applied in 20 public sector schemes in the UK, after the Court of Appeal ruled in 2018 that the government had discriminated against younger scheme members when it protected those closer to pension age from a 2015 change to career average.
The remedy involves calculating benefits on both a final salary and a career average basis and letting the individual choose – a process that has put considerable strain on administrators. These double calculations had to be presented to members by 1 April last year, or “such later day as the scheme manager considers reasonable” for a particular member or class of member.
The SPPA, along with many other public sector schemes, is making use of the discretion in the rules. Chief executive Stephen Pathirana expects that the bulk of casework across the Scottish schemes for teachers, police, firefighters and the NHS will be finished in 2026, but that a small proportion of the more complex cases “will likely remain outstanding”, documents by the Finance and Public Administration Committee show.
MSPs are unimpressed by this further delay after previous deadlines have been missed, saying: “The Committee remains to be convinced that these matters are being treated with the sense of urgency that the matter deserves.”
They asked Pathirana to appear before the committee again next month, having met with him in December last year, and to send case numbers and a delivery plan by 2 March.
In October last year, Pathirana said he had engaged with the Pensions Regulator about changing the timetable, and that “the Regulator recognises the scale of the administrative challenges facing all the UK public service pension schemes and has acknowledged our reasons for adjusting the target dates”.
Citing the complexity of legislation and calculations and the fact the remedy is handled on top of routine work and other special work like dashboards, he argued that the progress of the SPPA was “broadly comparable to other public service pension scheme managers who are managing remedy” and even ahead of other providers in some aspects.
The SPPA is not alone in facing an uphill struggle in implementing the McCloud remedy. Delays in the NHS Pension Scheme led the government to adjust the scheme’s delivery timetable in spring last year.
In the Local Government Pension Scheme, the picture looks similar. The Northern Ireland Local Government Officers' Superannuation Committee’s deadline has been extended to 28 February this year. The funds for Buckinghamshire and Leicestershire have extended their implementation deadline until 31 August 2026, while Nottinghamshire’s pension fund has also reported delays.
The fact that many public sector schemes have had to extend their delivery timeline means the regulator appears to be lenient for now.
A TPR spokesperson said: “We are aware that many public service schemes have found it difficult to comply with the timescales to provide members with information about remediation. We are engaging with the largest schemes about their progress and encouraging others to report their progress to us.”
The spokesperson added that “where necessary we are providing support and while we reserve the right to use our powers in the future, at the moment we do not envisage that they would be useful in most cases”.
The SPPA, along with many other public sector schemes, is making use of the discretion in the rules. Chief executive Stephen Pathirana expects that the bulk of casework across the Scottish schemes for teachers, police, firefighters and the NHS will be finished in 2026, but that a small proportion of the more complex cases “will likely remain outstanding”, documents by the Finance and Public Administration Committee show.
MSPs are unimpressed by this further delay after previous deadlines have been missed, saying: “The Committee remains to be convinced that these matters are being treated with the sense of urgency that the matter deserves.”
They asked Pathirana to appear before the committee again next month, having met with him in December last year, and to send case numbers and a delivery plan by 2 March.
In October last year, Pathirana said he had engaged with the Pensions Regulator about changing the timetable, and that “the Regulator recognises the scale of the administrative challenges facing all the UK public service pension schemes and has acknowledged our reasons for adjusting the target dates”.
Citing the complexity of legislation and calculations and the fact the remedy is handled on top of routine work and other special work like dashboards, he argued that the progress of the SPPA was “broadly comparable to other public service pension scheme managers who are managing remedy” and even ahead of other providers in some aspects.
The SPPA is not alone in facing an uphill struggle in implementing the McCloud remedy. Delays in the NHS Pension Scheme led the government to adjust the scheme’s delivery timetable in spring last year.
In the Local Government Pension Scheme, the picture looks similar. The Northern Ireland Local Government Officers' Superannuation Committee’s deadline has been extended to 28 February this year. The funds for Buckinghamshire and Leicestershire have extended their implementation deadline until 31 August 2026, while Nottinghamshire’s pension fund has also reported delays.
The fact that many public sector schemes have had to extend their delivery timeline means the regulator appears to be lenient for now.
A TPR spokesperson said: “We are aware that many public service schemes have found it difficult to comply with the timescales to provide members with information about remediation. We are engaging with the largest schemes about their progress and encouraging others to report their progress to us.”
The spokesperson added that “where necessary we are providing support and while we reserve the right to use our powers in the future, at the moment we do not envisage that they would be useful in most cases”.
