Armed Forces Pension Scheme: Future pension provision from 1 April 2022

Question 1

1. 	Consultation process

Accepted Answer

The Ministry of Defence will consult the list of stakeholders identified in Annex A, but this is a public consultation and we would welcome all views on the draft regulations to amend the AFPS.

1.1 Who this consultation is aimed at

This consultation applies to the regular and reserve UK Armed Forces personnel.

1.2 Consultation questions

Respondents are invited to consider the following questions:

Question 1

(1) The Public Service Pensions and Judicial Offices Bill closes legacy pension schemes to further accrual from 1 April 2022 and ensures that all public service workers who continue in service do so as members of reformed 2015 pension schemes. Do you agree that the draft regulations ensure that from 1 April 2022 all serving personnel who were full protection members on 31 March 2022 will transition to the AFPS 15 and begin to accrue benefits under that scheme?
(2) If ‘no’, why?
(3) Are there any other changes needed to ensure the rules of the various Armed Forces pension schemes achieve this aim?
(4) Are there any equality impacts as a result of the proposed regulations to implement the closure of the legacy schemes that the Department has not identified and needs to take account of?
(5) Are there any additional comments you wish to provide with regard to the proposed changes to the Armed Forces Pension Scheme as set out in this document?

Question 2

(1) Do you agree that the draft regulations retrospectively correct an error in the 2015 Transitional Schedules relating to Full Protection Members and Re-joiners in AFPS 05 and RFPS 05?
(2) Do you agree that the draft regulations achieve the purpose of correcting errors retrospectively in respect of the following?

Retrospectively amending the AFPS 75, AFPS 05 and RFPS 05 to require that an application for the secondment Additional Voluntary Contribution (AVC) is accompanied by an application for added pension under AFPS 15
Retrospectively inserting the secondment AVC into the AFPS 05
Retrospectively amending the AFPS 15 to ensure that a person who had opted out of the legacy scheme remains opted out of the AFPS 15

(3) If ‘no’, why?

Question 3

(1) Government policy in cases where the medical boarding process has commenced before 1 April 2022 is that all active members will transfer to the new scheme on 1 April 2022. However, schemes may amend their rules to provide an ‘ill health underpin’ to ensure members are not disadvantaged by moving to the new scheme. MOD has assessed benefits paid in these circumstances and does not consider that members in these circumstances would receive lower benefits, hence, MOD does not consider it necessary to implement an underpin. Do you have any views on this policy?
(2) Do you believe any changes to scheme rules are required to implement this policy intent?
(3) If yes, which rules require amendments and why?

Question 4

(1) Are there any further considerations that you think the Department should take into account when assessing any equality issues arising as a result of the proposed amendments?
(2) If yes, please give your reasons and supporting statement.
(3) Is there anything that could be done to mitigate the impacts you have identified?

Question 5

Do you have any further comments on either the draft regulations retrospectively or the equalities impact of the proposals set out in this consultation?

1.3 Duration of the consultation

The consultation period begins on 22 November 2021 and runs until 31 January 2022.

1.4 How to respond to this consultation

Please send your consultation responses by email to AFPension-Policy@mod.gov.uk or by mail to:

Ministry of Defence
AF Remunerations - Pensions
Main Building
6th Floor Zone M
Whitehall
SW1A 2HB

1.5 Government response

We will aim to publish the government response to the consultation on the Gov.UK website, alongside any updated draft scheme regulations.The timing of the implementation of the scheme regulations is dependent on the passage of the Bill through Parliament.

1.6 How we consult

This consultation is being conducted in line with Cabinet Office consultation principles published in March 2018. These principles give clear guidance to government departments on conducting public consultations. If you have any comments about the consultation process (as opposed to comments about the issues we are consulting on), including if you feel that the consultation does not adhere to the values expressed in the consultation principles or that the process could be improved, please respond to the address provided at paragraph 1.4.

1.7 Freedom of Information and Data Protection

Information provided during this consultation, including personal information, may be published, or disclosed in accordance with access to information regimes, primarily the Freedom of Information Act 2000 and the Data Protection Act 2018.

If you want the information you provide to be treated confidentially, please be aware that, in accordance with the Freedom of Information Act, public authorities are required to comply with a statutory code of practice which deals, amongst other things, with obligations of confidence. In view of this, it would be helpful if you could explain to us why you wish that information to be treated confidentially. If we receive a request for disclosure of that information, we will take account of your explanation, but we cannot give an assurance that confidentiality can be maintained in all circumstances.

We will process your personal data in accordance with the Data Protection Act 2018 (and the General Data Protection Regulation) and, in most circumstances, this will mean that your personal data will not be disclosed to third parties. Details of the MOD’s Personal Information Charter can be found in the MOD’s personal information charter.

1.8 Public Sector Equality Duty

The proposals covered in this consultation have been assessed by reference to the public sector equality duty contained in the Equality Act 2010. This requires the MOD to pay due regard to the need to:

a. eliminate unlawful discrimination, harassment and victimisation and other conduct prohibited by the Act;

b. advance equality of opportunity between people who share a protected characteristic and those who do not;

c. foster good relations between people who share a protected characteristic and those who do not.

We do not believe that the proposals will result in any unlawful direct, or indirect discrimination. These are set out in more detail in the Equalities Impact Assessment published alongside this document.

Question 2

2. 	Changes to the Armed Forces Pension Schemes

Accepted Answer

2.1 Context

As part of the 2015 pension reforms, those within 10 years of retirement on 31 March 2012 remained in their legacy pension schemes. This transitional protection arrangement was determined by a Court to be unlawful age discrimination^{[footnote 2]} and the Government set out its proposals to address that discrimination in a public consultation in 2020. The rationale for reforming public service pensions, and introducing the reformed schemes still stands. The Government remains of the view that the 2015 schemes offer appropriate pension provision and address the objectives of affordability and sustainability.

The reformed schemes themselves are not discriminatory, and the Government believes that moving all active members into the reformed schemes going forward ensures that they are treated equally in respect of the scheme design available to them for future service. These plans achieve this, but if some members were able to remain in legacy schemes while others were not, this key objective would not be met.

Therefore, the Government intends that all members of the main unfunded public service pension schemes (excluding judges) who continue in service from 1 April 2022 onwards will do so as members of their respective reformed scheme. Legacy schemes will be closed in relation to service after 31 March 2022, bringing the discrimination to an end.

The rules of the various schemes need to be amended to ensure that they reflect the primary legislation, allowing members who move to the AFPS 15 on 1 April 2022 to accrue benefits on the same basis as those who moved in 2015. Further, some technical changes were not properly implemented in 2015 and these will be incorporated into legislation to ensure the rules work as intended for all members.

Question 3

3. 	Legislation

Accepted Answer

3.1 Public Service Pensions and Judicial Offices Bill 2021

The Public Service Pensions and Judicial Offices Bill 2021 was introduced on 19 July 2021 and is currently going through Parliament. This Bill, among other measures to remedy the discrimination found by the Court of Appeal, provides that all pre-2015 schemes (legacy schemes) will close for the purposes of future accrual of benefits on 31 March 2022. The effect of this is that it will no longer be possible to accrue benefits in those schemes for periods of service on or after 1 April 2022. The draft regulations on which we are now consulting will amend the rules of the various Armed Forces pension schemes to ensure that they are in accordance with the provisions of the Bill, making the necessary changes to permit formerly protected members to join the AFPS 15 from 1 April 2022, and to accrue benefits in that scheme on the same basis as those who moved in 2015.

The Bill also introduces measures to provide a remedy for those who suffered discrimination between the period 1 April 2015 to 31 March 2022. However, the regulations to implement those measures will be brought forward later in 2022 and this aspect of the remedy is not covered in this consultation.

3.2 Armed Forces Pension Schemes

Prior to 2015, there were 6 Armed Forces Pension Schemes, which provided benefits for either regular or reserve service. These are collectively known as the legacy schemes:

Armed Forces Pension Scheme 1975 (AFPS 75)
Full-Time Reserve Service Pension Scheme 1997 (FTRS 97)
Armed Forces Pension Scheme 2005 (AFPS 05) and Armed Forces Early Departure Payments Scheme 2005 (EDP 05)
Reserve Forces Pension Scheme 2005 (RFPS 05)
Non-Regular Permanent Staff Pension Scheme (NRPS 11)

3.3 AFPS 75

The AFPS 75 covers regular members of the Armed Forces who joined before 6 April 2005 and did not transfer to the AFPS 2005. The rules of the scheme are contained in Schedules 1 and 3 to three identical instruments, made under a mixture of the royal prerogative and statutory powers. Each instrument sets out the rules of the scheme for one of the Services: Royal Navy (Order in Council), Army (Royal Warrant), and Royal Air Force (Queen’s Order).

In 2010, the rules of the scheme were harmonised and re-stated in new instruments, which are amended from time to time. The original pension rules are found in Schedule 1 (which was replaced in its entirety with effect from 3 January 2011) and Schedule 3 contains the transitional provisions made in 2015. The instruments can be found in the Armed Forces Pension Scheme 1975 Regulations. It should be noted that the scheme rules have also been amended by other legislation related to the introduction of same sex marriage and opposite sex civil partnerships.

3.4 AFPS 05 and EDP 05

The AFPS 05 and EDP 05 schemes provide benefits to regular members of the Armed Forces. They were introduced on 6 April 2005 and the rules are contained in two statutory instruments: the Armed Forces Pension Scheme Order (SI 2005/438) and the Armed Forces Early Departure Payments Scheme Order 2005 (SI 2005/437). The AFPS 05 rules are contained in 2 Schedules:

Schedule 1, which contains the scheme rules
Schedule 2, which contains the transitional provisions introduced in 2015

3.5 FTRS 97

The FTRS 97 is made under the Reserve Forces Act 1996 and provides benefits for members who serve on certain types of reserve commitment. The scheme closed to new members on 5 April 2005. The scheme rules are contained in Defence Council regulations and a second Schedule containing transitional provisions was inserted in 2015. Read more: Armed Forces Pension Scheme 1975 Regulations.

3.6 NRPS 11

The NRPS 2011 rules are contained in regulations made under powers in the Reserve Forces Act 1996, which effectively re-state provisions previously made under Part 3 of Chapter 9 of the Territorial Army Regulations 1978. Schedule 3 to the scheme was inserted in 2015 and contains the transitional provisions. The scheme provides benefits to non-regular permanent staff of the reserve forces and was closed to new members on 1 September 2011. Read more: Armed Forces Pension Scheme 1975 Regulations.

3.7 RFPS 05

The RFPS 05 was introduced on 6 April 2005 and provides benefits for members of the reserves forces who are on a full-time reserve service commitment, an additional duties commitment, or who are mobilised and who choose to join the scheme. The scheme rules are contained in Defence Council regulations, and Schedule 2 containing transitional provisions was inserted in 2015. Read more: Armed Forces Pension Scheme 1975 Regulations.

3.8 AFPS 15

On 1 April 2015, the Armed Forces Pension Scheme 2015 (AFPS 15) and Armed Forces Early Departure Payments Scheme 2015 (EDP 15) were introduced. The AFPS 15 provides benefits for all members of the Armed Forces, whether reserve or regular. The EDP 15 provides various benefits, some to regulars only and others to regulars and reserves. The rules of both schemes are contained in regulations made under the Public Service Pensions Act 2013 and are amended from time to time. These can be found on legislation.gov.uk: SI 2014/2336 and SI 2015/2328.

Question 4

4. 	The Draft Regulations

Accepted Answer

This section explains the impact of the draft regulations.

4.1 Closure of legacy pension schemes

All pre-2015 schemes (legacy schemes – see chapter 3) will close on 31 March 2022, under provisions currently found in clause 76(2) of the Bill. The effect of this is that it will no longer be possible to accrue benefits in those schemes for periods of service on or after 1 April 2022.

4.2 Transitional Provisions

In 2015 transitional arrangements were established to protect members who had accrued rights to pension in the legacy schemes^{[footnote 3]}. The draft regulations will ensure that these transitional provisions extend to members who were previously full protection members from 1 April 2022: they will become transition members with continuity of service from that date.

As set out above, these draft regulations make amendments to the scheme rules, for the following purposes:

a. to ensure all active members, who were full protection members in a legacy scheme until 31 March 2022, and who continue in service, have access to the AFPS 15 from that date;

b. to make other minor changes to ensure the scheme rules are in accordance with the primary legislation; and

c. to retrospectively remedy previous errors in scheme rules.

4.3 Full protection and access to the AFPS 15

Part 2 of the Transitional Schedule in each legacy scheme sets out the criteria for being a full protection member of that scheme – and thus being entitled to remain in the legacy scheme.

The draft regulations amend the relevant paragraph in Part 2 of each Transitional Schedule which sets out how a member can lose full protection. The draft ensures that full protection will cease for all members at the very latest on 31 March 2022. This ensures that no members can continue to accrue benefits under the legacy schemes in relation to service after 1 April 2022.

The provisions of paragraphs 1 to 3 of each Transitional Schedule provide that members who lose full protection in this way will become transition members with continuity of service and, as they are in pensionable service on their transition date, they will then become members of the AFPS 15. Once they are no longer Full Protection members of a legacy scheme, they are eligible for membership of AFPS 15 (regulations 14 and 16 AFPS 15).

As these members will be transition members with continuity of service from 1 April 2022, the provisions relating to such membership in the Transitional Schedule for the relevant legacy scheme for their type of service will apply to them, including provisions on the final salary link. Some minor amendments of the provisions are necessary to ensure that this works smoothly for them.

Minor consequential changes to Scheme Rules: All legacy schemes

4.4 Ill Health

In Part 5 of each Transitional Schedule, provision is currently made in relation to cases where an ill-health pension or lump sum award had been claimed before the member’s transition date, but no decision finally made. In 2015, these provisions permitted a member to remain in their legacy scheme until the final decision on whether an ill-health pension should be awarded had been made. These exemptions were along the same lines as those in Part 2 for full protection members. As the Bill revokes the powers under which these exemptions can be made, such exceptions will no longer be possible after 1 April 2022. This means that all members in the legacy schemes will move to the AFPS 15 on 1 April 2022, with no exceptions. These regulations therefore revoke the 2015 provisions in relation to ill-health claims in train before the member’s transition date.

Government policy in cases where the medical boarding process has commenced before 1 April 2022 is that all active members will transfer to the new scheme on 1 April 2022. However, schemes may amend their rules in relation to this cohort of member, to provide an “ill-health underpin” in the reformed scheme rules if this is considered necessary. Such an underpin would involve making a comparison between what the member would have received had they medically discharged on 31 March 2022, and what they are entitled to as a transition member when they actually discharge on medical grounds. In cases where:

the benefits payable on date of actual discharge (accrued rights and new scheme benefits) are lower than the amount that would have been payable on 31 March 2022 from the legacy scheme alone
the member does not ultimately elect for new scheme benefits for the period 1 April 2015 to 31 March 2022

the member would be entitled to receive a top up to their new scheme benefits to bring them up to the value of the benefits that would have been payable under the legacy scheme had they medically discharged on 31 March 2022.

MOD has considered whether such an underpin is required in the AFPS and has concluded that it may not be. The ill-health pension rules in the AFPS 15 and EDP 15 are the same as those in the AFPS 05, EDP 05 and RFPS 05. The threshold for an ill-health pension in the AFPS 75, FTRS 97 and NRPS 11 is that the member meets the threshold for the Tier 1 award under EDP 05 and EDP 15. An assessment of the benefits payable to transition members in these circumstances indicates that these would not be lower than those which would have been payable by the relevant legacy scheme had service terminated on 31 March 2022. However, we will consider further whether any changes to scheme rules are required to ensure that a member medically downgraded by a medical board on or before 31 March 2022, but not seen by an employability board until after 1 April 2022 (and where discharge on medical grounds is confirmed), will be treated no less favourably than if the process had been concluded on 31 March 2022.

4.5 Reckonable service

This applies to all schemes. In all the legacy schemes, the value of the pension is calculated by reference to, among other factors, the member’s reckonable service in the scheme. Each scheme has different rules regarding what is considered to be reckonable service. MOD has decided to amend the rules relating to reckonable service in each scheme to ensure that it is clear that no further reckonable service can be accrued after 1 April 2022. This is not an essential amendment, as it simply reproduces the effect of clause 72(2) of the Bill. However, as all the legacy schemes are made under different statutory powers, and most are not statutory instruments, it seemed prudent to MOD to make the issue clear in the rules.

4.6 Additional Voluntary Contributions: AFPS 75, AFPS 05 and RFPS 05

The AFPS 75, AFPS 05 and RFPS 05 all make provision for members to exercise options to purchase additional benefits: these are termed additional voluntary contributions (AVCs) in each scheme. The standard rules on AVCs are different in each scheme and are set out in Part C of Schedule 1 in each scheme. In 2015, apart from three AVCs in the AFPS 75 (see below), Government policy was that AVCs which had been entered into before the member’s transition date would continue for the original period, and the transitional provisions were drafted on that basis. This remains Government policy: AVCs entered into before 1 April 2022 will remain in place until they reach the end of the agreed term; It will not be possible to enter into new arrangements under legacy scheme rules after 31 March 2022.

4.7 AFPS 75

Under Part C of Schedule 1 to this scheme, members could take advantage of 5 different AVCs. Transitional provision in relation to these is found in Part 6 of the Transitional Schedule:

a. purchase of enhanced benefits for the member (based on actual salary rather than representative rate for rank) (rule C4), enhanced benefits for spouse (rule C6) and an enhanced death in service lump sum (rule C8). These benefits were no longer required once a member had moved to the AFPS 15, and thus provisions in Part 6 of the Transitional Schedule cancelled these three AVCs with effect from the member’s transition date. This will apply to members who transition on 1 April 2022 also. The value of benefits under rule C4 and rule C6 are pro-rated to the member’s transition date and paid in accordance with the scheme rules. A death in service lump sum for a transition member is paid under the AFPS 15 rules only, with no accrued rights in AFPS 75. The AFPS 15 death in service benefit is worth more than the AFPS 75 death in service benefit as it is paid at four times the member’s salary, as opposed to three times the member’s representative rate for AFPS 75.

b. purchase of additional reckonable service (rule C1). This AVC ends the day before a member’s 55th birthday. A minor consequential change is required to paragraph 49 of the Transitional Schedule to replace a reference to 31st March 2015 with a reference to the member’s transition date, in order to ensure it works for all transition members, whenever they transferred to AFPS 15.

c. purchase of reckonable service for period of secondment/loan. Minor amendments are required to paragraph 48 of the Transitional Schedule to replace references to 1 April 2015 with a reference to the member’s transition date. Paragraphs 4.10 - 4.12 below set out further information on this type of AVC.

4.8 AFPS 05

Under the rules of this scheme, members had access to two types of AVC: one to purchase additional reckonable service, and one to purchase additional reckonable service to cover a period of secondment/loan (see below at paragraphs 4.10 – 4.12). Paragraph 46 of the Transitional Schedule provides that AVCs to purchase additional reckonable service entered into before 31 March 2015 continued after that date. The draft regulations simply amend the wording of paragraph 46 to replace references to 31 March 2015 with references to the member’s transition date. This will ensure that the provision works smoothly for those members who transition on 1 April 2022 as well.

4.9 RFPS 05

The rules of this scheme provide that members who had a period of secondment or loan and who returned to service immediately after can opt to purchase additional reckonable service to cover the period of the secondment/loan. Paragraph 43 of the Transitional Schedule made consequential amendments in 2015, and these are now further amended by replacing references to 1st April 2015 with the member’s transition date.

4.10 Secondment/Loan: retrospective provision for purchase of additional reckonable service

It is not uncommon for service personnel to have a period of secondment or loan to external organisations, (for example, UN or NATO). Some external organisations require that the individual joins their occupational pension scheme for the period of the secondment/loan. These individuals are required to pay member contributions during the period of their secondment/loan. However, as they do not usually vest in the scheme, these contributions are refunded to them when the secondment/loan ends. If the individual returns to Armed Forces service, they are able to purchase additional reckonable service equal to the period of the secondment/loan if they pay over to the scheme all the monies refunded or paid to them in respect of their membership of the external organisation’s pension scheme. The amount required to purchase the additional reckonable service is calculated by the scheme actuary, and in some cases, the amounts paid over by the individual from their secondment scheme are not sufficient to purchase the additional reckonable service required: in such cases the rules provide that the member’s Service pays the difference into the scheme.

MOD policy is that where an individual who would otherwise be an active full protection member of a legacy scheme is on such a secondment/loan over their transition date, and they return to pensionable service in the AFPS 15, they should be able to purchase additional reckonable service in the legacy scheme equal to the period of the secondment/loan before 31 March 2022. The requirement to pay the full amount of the monies received from the external pension scheme remains. The transitional regulations in 2015 contained footnotes indicating that members would have an option to purchase added pension in the AFPS 15 by way of a lump sum contribution. Regulation 97 of the AFPS 15 is the relevant regulation and is framed in a very similar way to the legacy scheme rules. Both options must be exercised together, and it is not possible to exercise an option in one scheme and not the other. Internally, the scheme manager will calculate, in consultation with the scheme actuary, the amount required to purchase the added years before transition and the added pension after transition, and the lump sum paid in by the member is used to settle this, with the sponsoring unit making up any shortfall.

4.11 AFPS 05

In 2015, the transitional rules for the AFPS 05 failed to make this type of provision for those on secondment/loan. This was an error and did not reflect the MOD’s clear policy intent. These draft regulations will also amend Schedule 2 of the AFPS 05 rules (the Transitional Schedule) to insert a rule to ensure that those members who have been on a relevant secondment/loan which straddles their transition date (whether that is 1 April 2015 or 1 April 2022) are entitled to purchase additional reckonable service for the period up to their transition date. The amendment is made to clarify the requirement which has been implemented in practice since 2015. This provision will have retrospective effect back to 1 April 2015.

4.12 AFPS 75 and RFPS 05

Likewise, amendments are made to the relevant rules in the AFPS 75 and RFPS 05 Transitional Schedules to explicitly link the purchase of the added years for secondment option in these schemes to the added pension for secondment option in the AFPS 15. These provisions will have retrospective effect back to 1 April 2015.

4.13 Retrospective Provision: amending errors in the 2015 Transitional Schedules relating to Full Protection Members and Re-joiners – AFPS 05 and RFPS 05

The older legacy schemes (AFPS 75, FTRS 97 and NRPS 11) were all closed to new members by early September 2011. In 2015, the rules in the Transitional Schedules for these schemes made no provision for full protection to be restored once lost, because a member had left pensionable service under the scheme.

MOD’s policy intent was that where a full protection member of the AFPS 75, FTRS 97 or NRPS 11 left service and then subsequently re-joined, they could (if they met all the criteria) return as full protection members of the scheme which they could have joined on 31 March 2012. For members of the AFPS 75, this was the AFPS 05 and for members of the FTRS 97 and the NRPS 11, this was the RFPS 05^{[footnote 4]}. This accorded with wider Government policy to allow members of the main public service pension schemes with full protection to move between schemes and to retain that full protection if they met certain criteria (re-joiner policy).

Accordingly, detailed provisions were inserted into the AFPS 05 and RFPS 05 Transitional Schedules, setting out the circumstances in which individuals who re-joined into regular or reserve service, having left a scheme in which they had had full protection, could retain that protection. Paragraph 9 in each Schedule contains the relevant rules. A key feature was that the member would have been a full protection member of their earlier scheme if they had returned to service pensionable under that scheme on the date they re-joined (paragraph 9(1)(d)(i)). However, it was impossible for former full protection members of the AFPS 75, FTRS 97 and NRPS 11 to meet this condition, because it was not possible for them to regain full protection in those schemes once they left service in them.

The draft regulations amend paragraph 9 in each Transitional Schedule to ensure that the MOD’s policy intent is achieved. The amendments will ensure that former full protection members of these three schemes will not be disqualified from full protection status in either the AFPS 05 (regular service) or the RFPS 05 (reserve service) simply because they could not return to full protection membership in their original legacy scheme. These amendments will be retrospective in effect, back to 1 April 2015.

4.14 Amendments to the AFPS 15: Minor, Consequential, and Retrospective

Minor amendments are required to the AFPS 15 to ensure that it works smoothly with the amended legacy transitional rules to allow members who transition on 1 April 2022 to accrue pension in the AFPS 15.

Amendments are made to the definition of transition member, and a new definition of transition date is inserted. Regulation 22, which defines qualifying service for the purposes of the AFPS 15, is amended, in relation to a transition member with continuity of service, to replace a reference to a specific date (31 March 2015) with a reference to the member’s transition date.

Regulation 16 of the AFPS 15 sets out who is eligible for membership of the AFPS 15. It was possible to opt out of membership of the legacy pension schemes and MOD’s policy in 2015 was that only those individuals who were active members of a legacy pension scheme would become members of the AFPS 15 automatically. Provision is made in the AFPS 15 for members to opt into that scheme should they wish to do so, but policy intent was that the rules would not pre-empt that choice for transition members.

A retrospective amendment is made in these regulations to make this policy explicit on the face of the rules. This clarifies that where a member had opted out of membership in a legacy scheme, this opt out remains in force when they enter service which could be eligible for membership of the AFPS 15. The member is at liberty to opt into the AFPS 15 at any time^{[footnote 5]}. This provision will have retrospective effect back to 1 April 2015.

Question 5

5. 	Conclusion

Accepted Answer

The Government believes that the reformed pension schemes, including AFPS 15, offer appropriate and generous pension provision for members, whilst also offering protection for the taxpayer against unsustainable costs. They are among the best available in the workplace: backed by the taxpayer, index-linked and offer guaranteed benefits on retirement. The rationale for the reforms still stands and it is therefore right that anyone who remains in service from 1 April 2022 will do so as a member of the reformed AFPS 15. This will ensure fair treatment for all.

Implementation of the regulations is subject to passage of the Bill. It is expected that regulations will be laid in March 2022, subject to this consultation, and come into force 1 April 2022.

The pension scheme administrator (Defence Business Services) will write to all members who are in legacy pension schemes to advise them of the changes to pension arrangements from 1 April 2022 and the MOD will issue workforce communications to update on changes and provide more detailed policy guidance. No action needs to be taken by individuals. Changes to pension arrangements will be made automatically.

Question 6

Annex A.	List of Stakeholders Consulted

Accepted Answer

List of Stakeholders Consulted

The Confederation of Service Charities
The Royal British Legion
The Soldiers, Sailors, Airmen and Families Association
The Royal Navy and Royal Marines Charity
ABF The Soldiers Charity
The RAF Benevolent Fund
The RAF Association
The Navy Families Federation
The Army Families Federation
The RAF Families Federation
The War Widows’ Association
The Forces Pension Society
The White Ensign Association

The Veterans Advisory and Pensions Committee
Armed Forces Pension Schemes, Pension Board
Armed Forces Pension Schemes, Scheme Advisory Board
The Pension Regulator
The Armed Forces Pay Review Body

© Crown copyright 2021
This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit the National Archives or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives.gov.uk.

As defined in the rules of the AFPS. ↩
In December 2018 the Court of Appeal found in Lord Chancellor and Secretary of State for Justice v McCloud, The Secretary of State for the Home Department v Sergeant 2018 EWCA Civ 2844 (the McCloud judgment) that the transitional protection unlawfully discriminated against younger members of the judicial and firefighters’ pension schemes on the basis of age, and also gave rise to indirect sex and race discrimination. ↩
Armed Forces (Transitional Provisions) Pensions Regulations 2015 (SI 2015/568). ↩
It was MOD policy by then that no new NRPS commitments were to be allowed: former members of the NRPS 11 should have re-joined as FTRS. ↩
Unless the scheme manager specifies, the member may only exercise the option once during any period of 12 months. ↩

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Consultation 22 November 2021

FOREWORD

Introduction

1. Consultation process