Employer Policies on Discretions
With effect from 1 April 2014 the Local Government Pension Scheme Regulations 2013 and the Local Government Pension Scheme (Transitional Provisions, Savings and Amendment) Regulations 2014 came into force.
Under these Regulations, as with previous Regulations, Scheme employers are required to prepare, maintain and keep under review a statement of policy concerning a number of discretions made available to them throughout the Regulations. Scheme employers have many decisions to take with regard to numerous discretions and requirements made of them as outlined in the statutory legislation and it is important that each Scheme employer takes full responsibility for ensuring that their obligations are fulfilled appropriately and in accordance with the statutory instruments laid by Parliament.
Some statements of policy in respect of certain Scheme Regulations are compulsory as in the main they can carry significant cost implications for a Scheme employer and this is the minimum policy requirement made of Scheme employers. However, it is generally recognised that there is considerable value in Scheme employers making statements of policy in respect of other Scheme Regulations where discretion is available to them for ease of administration and consistency of approach even though it is not compulsory to do so.
The discretions that Scheme employers must publish policies on are:
- Employer Funded Additional Pension contributions (Reg 16(2) (e) and 16 (4) (d)
- Flexible retirement (Reg 30(6)
- Wavering of Actuarial Reduction (Reg30(8)
- Award of additional pension (Reg 31)
- Rule of 85 Voluntary Early Retirement (Schedule 2, para 2(2)
Find out more about the London Borough of Redbridge Discretions Policy (PDF 2.9MB)