Central government pensions

There are a number of pension schemes which operate within the central government sector in England and Wales.

The largest schemes are:

•
the NHS Pension Scheme
•
the Teachers’ Pension Scheme
•
the Principal Civil Service Pension Scheme

All three schemes are unfunded statutory public service pension schemes.

In addition to the three largest schemes, there are also a range of other schemes operating within the sector, including:

•
the Armed Forces Pension Scheme
•
the Police Pension Scheme
•
the Parliamentary Contributory Pension Fund for MPs

The NHS Pension Scheme

The NHS Pension Scheme (NHSPS) is a multi-employer, unfunded, defined benefit public service occupational pension scheme for employees of the NHS in England and Wales. The scheme rules are set and amended by statutory instrument.

The NHSPS was reformed on 1 April 2008 and different rules apply to members depending on whether they joined before or after this date.

Members who joined the NHSPS before 1 April 2008 participated in the ‘1995 section’ which provides final salary benefits based on a 1/80^th pension and 3/80^th lump sum with a normal pension

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Latest Pensions News

Pensions Data Project report offers insights on members’ data matching for pensions dashboards and small pots consolidation

A report ‘Lessons learned from matching pension provider membership data’ has been launched on 12 February 2025 by the Pensions Data Project providing the initial findings on the potential for matching savers’ data in future initiatives such as pensions dashboards and small pot aggregation. The latest report involved amalgamating data across five master trusts to understand error rates in data matching and to gain insights into levels of matching. The findings from the latest report from the Pensions Data Project, which is being led by five master trusts and coordinated by the Pensions Policy Institute, include the fact that there is a high proportion of exact matches (around 85%) on National Insurance (NI) number, surname, and date of birth - though many partial matches require further verification. Less than 600,000 records matched only on NI number, suggesting its potential as a unique identifier. Approximately 40% of scheme memberships match with another provider, indicating potential for consolidation. There's also a significant chance that new members are already registered with another provider. A more detailed report focusing on understanding the small pots situation, including the value and build up or down of these pots, alongside pensions wealth across five master trusts, is set to be published later in 2025. A further future stage aims to establish a comprehensive database, expanding participation to include other parts of the industry, and data from other types of pension schemes. Insights gained from these reports are set to inform policy initiatives and thereby improve the efficiency of the UK pension market.

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Law360: The Financial Reporting Council (FRC) on 11 February 2025 confirmed that there are now 297 companies signed up to its stewardship code as it looks to finalise the latest iteration of the regime for investors this year.

IFS recommends automatic consolidation to address UK's small pension pots problem

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Law360: 23% of men aged 16 and above are actively contributing to their work-place defined contribution pension plans, compared to only 19% of women, a financial services consultancy said on 11 February 2025, adding to fears that the retirement savings gap between the genders is growing.