The number of employers such as universities, charities and housing associations joining the Local Government Pension Scheme (LGPS) has grown rapidly in recent years to more than 10,000 (10,671) – with an increase of 14 percent¹ in 2014-2013 alone. And this could grow even further over the next few years if some 16,000² state schools in England ultimately become academies.

The magnitude of the legal and financial obligations faced by employers participating in the LGPS is often underestimated and as a result some entrants are beginning to question whether they can afford to stay in the pension scheme. To support these employers and local authority funds, the Pensions and Lifetime Savings Association (PLSA) is publishing a series of guides for employers participating in the LGPS. The first of this guidance, published today, is designed to help employers understand what they need to know before joining the LGPS. Joanne Segars, chief executive of the Pensions and Lifetime Savings Association, commented:

“The Local Government Pension Scheme is the largest public sector pension scheme in the UK and provides some fantastic benefits for its members. But for employers participating in the LGPS there are significant legal, financial and administrative obligations which can cause a real headache. Many are beginning to question whether they can even afford to stay in the scheme. “This is why the Pensions and Lifetime Savings Association is launching a new series of guides to help employers gain a better understanding of their duties as part of the LGPS and what they can do to help manage the issues. It’s vital we support these employers to offer their employees the best possible access to saving for retirement.”

The guides will be launched later today (Wednesday) at the Pensions and Lifetime Savings Association’s Local Authority Conference in Gloucestershire and provide ‘scheduled bodies’³ with an introduction to the LGPS and ‘local government contractors’⁴ with help navigating entry into the LGPS. PDFs of both guides: A guide for employers participating in the LGPS: An introduction to the LGPS for scheduled bodies and A guide for employers participating in the LGPS navigating entry into the LGPS: for local government contractors are attached to this press release.

1 Local Government Pension Scheme Advisory Board, Scheme Annual Report 2014

2 DFE, Schools in England, March 2016 data extract

3 ‘Scheduled bodies’: Academies, County councils, London boroughs, post-92 Universities and further education colleges participate in the Local Government Pension Scheme as ‘scheduled bodies’. Scheduled bodies have an automatic right and requirement to be an employer in the LGPS as set out in Schedule 2 of the LGPS regulations. 

4 ‘Local government contractors’: Employers that help to deliver local public services. These employers are typically businesses; charities; and housing associations. If a local authority contract involves the transfer of staff to the organisation under a TUPE arrangement, the employer will come to participate in the LGPS as an ‘admission body’, or will be required to provide a ‘comparable’ pension benefit.