Teachers’ Pension Scheme | Barnett Waddingham

Pension services for independent schools

Most independent schools in England and Wales provide pension benefits for their teaching staff through the Teachers’ Pension Scheme (TPS) – a Government-backed, unfunded defined benefit pension scheme that provides benefits for in excess of 700,000 teaching staff throughout England and Wales. In Scotland, pension benefits are provided through a similar teachers’ pension scheme. The contributions the schools are required to pay are set by the Government and reviewed regularly.

TPS (and the Scottish equivalent) is an excellent way to provide defined benefit pension benefits in a low risk and relatively low cost manner, but costs have increased dramatically and schools that participate in the TPS are subject to whatever changes future Governments choose to make

Reviewing TPS participation

The most recent cost increases prompted many schools to take a fresh look at the way they provide pension benefits to teaching staff, while balancing the best interests of the school, pupils, parents and teachers. These reviews have also highlighted some political and other risks associated with TPS, which some schools are keen to avoid.

Solutions can take many forms, including sharing the cost of increases, considering whether to maintain membership for existing staff only might be of merit, offering an alternative arrangement or a combination of any of these. It is very important to understand the position from all sides to ensure a sustainable position is reached.

How we help schools with the Teachers Pension Scheme

Our independent expertise in both the TPS and alternative pension schemes puts us in an ideal position to support schools with these matters, whether it be modelling in relation to the options available, advice on suitable structures and providers if an alternative pension provision will be needed and wider support in relation to connected benefits such as group life cover and income protection

We have worked with the sector to design a modular approach to the support that can be provided. These take schools all the way from first thinking about pensions, through consultations and education with staff and ultimately (if there are any changes) to help implement any agreed arrangement.

We can also work with a school on:

support staff pensions, to help with an overall review of pension arrangements
wider benefits, to help with an overall review of staff benefit packages

We have excellent knowledge of the education sector and are not tied to any pension arrangements so can help ensure your school decides on the most appropriate pension arrangement for your teaching staff.

"The governors engaged BW to assist in two separate pension change strategies. The guidance and support provided was well presented and provided on time. They provided alternative options, outlined the risks and brought structure and clarity of understanding to the decision making process so governors were able to agree on the strategic direction. BW provided the management team with support throughout the consultation processes, the consultations were very complex and sensitive and their continued support gave the governors and management confidence throughout. Both governors and staff complimented BW on the clarity of delivery and the quality of the information provided. Whilst the process itself was challenging the support from BW meant that the process was completed with due care and attention. We have been very satisfied with the delivery of services by BW and we continue to call on them."
King's School Worcester, Feb 2021