Academies and the Local Government Pension Scheme
Date: 13th August, 2013 | Author: Wendy Bambrick | Comments: 0
Hertfordshire Pension Fund Local Government Pension Scheme (HPLGPS)
Historically schools have been able to take advantage of a pooling arrangement with the Local Authority (LA) however if a school has converted to an academy this pooling ceased.
In June 2013 the HP released a briefing note and pooling policy on the matter. The new pooling arrangement will extend participation to academies and separate out non-schools staff. It is stated that the benefits of being able to be in the pool are:
- It provides some protection against fluctuations in contribution rates;
- A common contribution rate can be set;
- Pension risks are shared.
There are two main questions that academies need to consider before deciding whether to opt in to the pooling arrangement:
- What will the contribution rate be under the pooling arrangement and how does that compare to the rate if the academy does not opt in.
- Will the academy be able to remove the pension liability from its balance sheet, this would only be the case if the academy’s share of the LGPS can not be separately identified.
For academies within the Hertfordshire Pension area then the deadline for opting in is 30 September 2013.
For other academies they should check with their local council to see what they are doing, if anything, with regard to pooling arrangements.