What is McCloud?

After reforming public service pension schemes in 2014 and 2015, the Government introduced transitional protections for older members. However, in December 2018, the Court of Appeal ruled that younger members of the judicial and firefighters’ pension schemes had been unlawfully discriminated against because the protections did not apply to them.

This ruling is called the ‘McCloud judgment’. As a result of the ruling, changes have been made to the LGPS to remove the age discrimination. These changes are known as the ‘McCloud remedy’.

In 2014, the LGPS changed from a final salary scheme to a career average scheme. Older members who were closer to retirement were protected from these changes. Members were protected if they met these conditions:

• born before 1 April 1957
• joined the LGPS before 1 April 2012 (or another public service pension scheme)
• under age 65 and an active member between 1 April 2014 and 31 March 2022
• took their pension straight away when they left the LGPS.

When a protected member retired, their pension fund compared the career average pension they built up before age 65 with the pension they would have built up in the final salary scheme. If the final salary pension was higher, the difference was added to their pension. This protection is called the underpin.

There were problems with the underpin. The ‘old’ rules did not guarantee that all protected members got a pension at least as good as they would have got under the final salary scheme.

The LGPS rules changed from 1 October 2023 because of the McCloud remedy. The changes are backdated to 1 April 2014, when the career average scheme started. If you qualify for underpin protection, you will be protected even if you have already left the LGPS or taken your pension.

The McCloud remedy means two main changes for LGPS members:

1. Qualifying younger members are now protected by the underpin too. This removes the discrimination found in the McCloud judgment.
2. The new underpin rules are much more detailed. This means that the underpin works fairly and consistently for all protected members. If you were protected by the ‘old’ underpin rules when you took your pension before 1 October 2023, your pension might increase under the ‘new’ rules.

The new underpin rules are very complex and will affect a large number of members. Your pension fund must review all the pensions it is paying to work out which ones will increase. Although these changes came into force from 1 October 2023, it will take your pension fund some time to review all the pensions it is paying.

Some LGPS members are protected by the McCloud remedy. Protection depends on when you were a member of the LGPS and if you have any other public service pension scheme membership.

You can CLICK HERE for more information and examples of if you may be protected by the remedy.

If you think you have previous public service which can be used as protection, please see the section below.

You do not need to contact the Fund, if we hold data which puts you in scope and protection of the McCloud remedy then we will include these values in your future annual statements from 2026.

We will look at your pension record to find out if you are in scope and protected by the underpin. If you were a member of another public service pension scheme before 1 April 2012, please complete a McCloud - Public Service Pension Rights Declaration Form we may not know. It is important that you provide the correct information so we can see what protection you are entitled to.

If you were not in the scheme before 1 April 2012 and have no previous public pension rights then you don’t need to do anything. If you qualify for underpin protection, we will work out if your pension is due to increase when you take it. If you are an active or deferred member, we will give you an estimate of how the underpin may affect your pension in your 2026 benefit statement.

Most members won’t see an increase because the pension they build up in the career average scheme is higher than the pension they would have built up in the final salary scheme. If there is an increase, it is likely to be small. If the calculations show your benefits are better by using the McCloud remedy underpin then your pension will be increased. If not, your pension remains the same.

A public service pension scheme is a UK pension scheme for:

• civil servants
• the judiciary
• the armed forces
• local government workers
• health service workers
• teachers
• fire and rescue workers
• members of the police force.

You do not need to complete the form if you are/were a councillor member in the West Midlands  Pension Fund.

You do not need to tell us about:

• membership of a public service pension scheme after you left the West Midlands Pension Fund (you might need to complete a form like this for the scheme you joined later)
• a survivor pension you are receiving from a public service pension scheme – but see the last section of these notes if you are receiving a survivor pension from the LGPS
• a pension credit in a public service pension scheme – this is a benefit awarded to you as part of a pension share following a divorce or dissolution of a civil partnership.

We will use the information you provide to find out whether you are protected by the McCloud remedy. You do this by completing a McCloud - Public Service Pension Rights Declaration Form. We may need to ask for more information from your previous pension administrator.

Active and deferred members: If you are protected, we aim to include an estimate of what this means for your pension in your 2026 annual benefit statement. We will take account of your protection in other figures we produce for you, such as retirement estimates.

This is not the form to use to request a transfer of previous pension rights. If you joined the LGPS less than a year ago, you can request a pension transfer by Contacting us.

A transfer is not usually possible after your first year of membership. Your employer may allow a late transfer in exceptional circumstances.