Teachers’ Pension: Contributions on the rise
The Government Actuary’s Department completed their valuation of the Teachers’ Pension Scheme, and valuation reports were released in June 2014.
The valuation is a measure of how the scheme’s costs are managed and determines the employer contribution rate that is required for the next four years, including any cost cap. The scheme assets at 31 March 2012 were valued at £176.6 billion and scheme assets were valued at £191.5 billion. As such the scheme is in deficit by £14.9 billion!
The immediate impact is that employer pension contributions for teachers will increase from 14.1% to 16.4%. This will take affect from 1 September 2015. Schools should be careful to consider this on their budgets for the coming years.