Consultation on Normal Minimum Pension Age

The HM Treasury Consultation document can be viewed here

The EIS response to the document and replies to the consultation questions are as follows:

"The Educational Institute of Scotland, Scotland's main union for teachers, lecturers and education professionals, fundamentally disagrees with the proposal as set out in the consultation document on the grounds that there is no reasonable justification for increasing the minimum pension age (NMPA) for Scottish teachers and lecturers.

Teachers and lecturers who currently retire at age 55 with significant actuarial reductions to their pension do so as a result of specific circumstances which mean they are no longer able to continue working in the profession. There is no justification for this increase in minimum retirement age in terms of projected life expectancy in Scotland."

Consultation questions and EIS responses:

1. Are there any specific considerations that should be taken into account regarding the government's proposed framework for the increase to the NMPA?

The proposed increase to the NMPA will remove flexibility for scheme members to access their pension benefits either partially or fully at any age after 55.

2. Are there any particular issues that the government should consider in the way NMPA is defined in pension scheme rules?

The government should consider that current pension scheme rules allow for flexible retirement options at any age after 55 which will allow teachers and lecturers to work longer in better health, an increase to age 57 will be a backwards and possibly discriminatory step.

3. The government proposes that the protected pension age will apply to all the member's benefits under the scheme (if the conditions for a protected pension age are met), not just those benefits built up before 2028. Are there any other alternative options or issues the government should consider around the treatment of accrued and future pension savings?

Scheme members should have a protected NMPA of 55 for all pension benefits going forward.

4. Are there any issues associated with schemes informing members who meet the conditions of their rights to a protected pension age?

This would be a decision for pension scheme managers on how they communicate this information to members but it would be a challenge to ensure that all those affected are appropriately advised.

5. Are there any circumstances why the increase in NMPA may impact on pension flexibility (which was introduced following the 2014  consultation on "Freedom and Choice in Pensions")

Moving the NMPA to age 57 removes flexibility for pension scheme members , if appropriate actuarial calculations are in place there is no justification for the increase.

6. Are there any implications the government should consider by not requiring that all scheme benefits must be crystallised on the same day as a condition for a protected pension age?

Current teachers' pension scheme rules do not allow for this although members may welcome greater flexibility in this respect.

The Pension Scheme Advisory Board response will follow.