Unified Scheme 2017 Review
Unified Scheme Reforms
Tynwald approved the Isle of Man Government Unified Scheme (Amendment) Scheme 2017 on 21 February 2017.
As a result of this, the Isle of Man Government Unified Scheme 2011 will be amended as follows:
For Active Members on 31 March 2017:
1. Reduce pension benefits built up on or after 1 April 2017 by 6%; and
2. Increase member contributions by 2.5% - phased in from 1 April 2018
For New Members on or after 1 April 2017:
3. Benefit accrual reduced by 6%; and
4. A contribution rate of 7.5%; and
5. For Fire-fighters in Section 7 a contribution rate of 13.5%
In addition to this Tynwald approved a motion that the PSPA and Treasury should further investigate options for managing the legacy position in the long term and should report back to the Council of Ministers, so it can put forward a full range of options and proposals to Tynwald by November 2017.
Background
In 2014 Tynwald passed a motion that expressed concern over the continued rising cost and liabilities of public sector pensions and called upon the PSPA to undertake a valuation of the schemes and report back to Tynwald in December 2014, on the feasibility of implementing further cost sharing and other measures, to reduce the long term liability and provide for a sustainable and fair pension scheme.
A Working Group was duly set up and it produced the Public Sector Joint Working Group Report – Fairness and Sustainability along with supporting documents.
As a consequence of this the PSPA set up the PSPA Pensions Committee (the Committee) to undertake a wide and in-depth consultation with all affected staff and their representatives into the recommendations made in the report. In January 2016, the Committee put forward a range of proposals to the PSPA – to increase contributions and to look at reducing the cost of member’s pension benefits in the future. The proposals were not endorsed by Prospect and the Prison Officers Association. This Committee was been disbanded in January 2016. Member notices issued can be found on the PSPA Pensions Committee page.
The PSPA submitted its report to the Council of Ministers in February 2016 and the proposals put forward by the PSPA were considered and approved by Tynwald in June 2016.
The PSPA consulted on the scheme changes during December 2016 and January 2017. The amendment scheme was subsequently approved by Tynwald on 21 February 2017.
Copies of the consultation documents can be viewed below:
PSPA Consultation Response Document
A copy of the PSPA consultation notice can be viewed
The full Consultation Document including the draft Isle of Man Government Unified Scheme (Amendment) Scheme 2017
A factsheet on how the changes will impact on member pensions
A factsheet on how the changes will impact on Practitioner Member pensions.
