Written evidence from Mr Andrew Grant (USP0059)

• I write as an individual retired member of the Teachers’ Pension Scheme, a former Headmaster and former Chairman of a registered Trade Union.
• I was born in 1953, so fall into the age group most affected by the changes.
• When I began teaching in 1976, the Teachers’ Pension Scheme guaranteed members, subject, obviously, to certain qualifying conditions a fully-indexed defined benefit pension from age 60. This was funded entirely by the Scheme.
• That guarantee remains in place, though the indexation has changed from RPI to CPI.
• In 1978, the TPS contracted out of SERPS. For service between that date and 1988, indexation of the GMP element of the Teachers’ Pension is paid by the Government from the state pension when the teacher reaches state pension age.  For service from 1988 onwards, the TPS was responsible for indexation up to 3% on the GMP element; the Government would pay any excess above that through the State pension.
• This is the position the latest Teachers’ Pensions newsletter continues to publish.  It is notable that the approach of the new state pension has generated articles on the GMP which explain the foregoing, which the Scheme appears not to have felt the need to explain before.  The DWP have, at all times, been silent on the matter.
• The Government’s role in part-funding the indexation of Teachers’ Pensions was not publicised widely, if at all, at the time contracting-out occurred, nor did/does it alter the Teachers’ Pension Scheme’s obligations to its members, which are to honour the guarantee of a fully indexed pension. The source from which the Scheme derives part of its funding is of no concern to the member, whose contract is with the Scheme.
• As I retired at age 61, before the then state pension age, indexation of my Teacher’s Pension until I receive my State pension, is paid by the Scheme.
• I now understand that the introduction of the new State Pension in April 2016 will entail the abolition of the Second State Pension and with it, the Government’s funding of indexing for the GMP element of my Teachers’ Pension.  Ironically, therefore, my Teachers’ Pension will be less fully indexed when I reach State retirement age than it is at present.
• “Contracting-out” does not merely imply a contract; it specifically states that a contract has been created, which the Government now appears to intend breaching, thereby placing the Teachers’ Pension Scheme in breach of contract with its members, unless it assumes responsibility for the gap in funding caused by the Government’s reneging on its contract.
• No information on this has come from the DWP.
• None has come from Teachers’ Pensions, who remain silent on the matter and cannot tell me how I will be affected until the DWP tell them, in just under four years’ time, what my state pension will be.
• The only source of information has been the Daily Telegraph.
• If you have not already done so, I strongly recommend that you review the numerous FOI requests to the DWP on precisely this matter.  The responses, if not actively mendacious, are obfuscatory, evasive, equivocatory and downright misleading.  This can only be deliberate and I was disappointed to see Steve Webb given such an easy ride on this very matter at the meeting on 25 November 2015 of the Work and Pensions Committee.

November 2015