With the recent news that the next increase in contribution costs for the Teachers’ Pension Scheme (TPS) will be delayed from 2023 to 2024*, many independent schools have taken the opportunity to draw breath and consider the TPS further.
Punter Southall Aspire is here to help schools wishing to consider if the TPS remains appropriate, and what alternative options are out there.
One key factor you should consider carefully is timescale and the pace of change.
We know that and we anticipate that the number will continue to increase over the coming years.
In an upcoming blog we’ll be sharing a few “lessons learned” from our experience with schools making this change, but in the meantime we thought it would be useful to share a few thoughts on the timescales for making a change.
Leaving the TPS?
How long does it take to review your options and, if appropriate, leave the TPS?
The simple answer is that we recommend schools factor in one full academic year in order to take the school on the change journey.
Why does the process take so long?
The actual timeline for change differs across each school, and legal advice should be sought on the contractual requirements.
However, the below sets out an example timeline with some of the key tasks and the time they take.
Here’s a little more detail:
Number of school terms
It’s vital that due care and consideration is given to the project, teaching staff’s needs and the school’s needs at the outset. This should typically include professional advice as well as consideration and agreement to proceed by the full Board of Governors.
Typically, this can take up to 1 full academic term to ensure the school is as well prepared as possible before commencing this challenging consultation with staff.
Up to one full term
A collective consultation is required first to engage with staff on the proposed changes and seek feedback. The legal requirement is 30 or 45 days (depending on the size of the school). However, we recommend a 60-day consultation to ensure the best outcome for schools and staff
Legal advice should be sought to confirm the legal and contractual duties of the school.
60 days, broadly 1 full academic term.
One full term
Contract termination (if required) If any teaching staff do not agree to the variation in their terms, it’s common for a 1 term notice to be provided to terminate their contract and re-hire on new contractual terms.
It is hoped that this is not required but it must be factored into any planning.
1 full academic term prior to implementation
One full term
Scheme goes live
End-point of the change project
(around 3 full terms/one school year, as shown above)
Preparation is the key to success
There are a few “war stories” across the independent school sector of good and bad outcomes following consultation with staff.
In addition, it’s important that those who will be seen as the decision makers (often the governing body) are well prepared to address concerns raised by teaching staff. This takes time; if it isn’t given the full attention it deserves it can cause significant employee relation challenges, or worse, financial challenges to the school through being unable to implement the changes required.
We appreciate how tough a time this is for many independent schools, which is why we've developed a simple, cost-effective service to help support you through any pension changes you want to make.
*Editor’s Note: This change is currently only effective in England and Wales and no announcement has been made for the Scottish Teachers’ Pension Scheme and Scottish Teachers’ Superannuation Scheme, although from conversations locally we believe the same alteration may be announced shortly. When we have further confirmation we’ll update you.