Employer contribution changes – from September 2015

HM Treasury (HMT) has published the final Directions and the expected outcome of the Teachers’ Pension Scheme valuation is a total contribution rate of 26%. The Teachers’ Pension Scheme proposed final agreement provides that scheme members will pay an average contribution rate of 9.6%, with the balance falling on employers; meaning that the new Scheme employer contribution rate will be 16.4% (does not include the 0.08% levy) which will be payable from September 2015. Until then the existing rate of 14.1% will be payable.

The rate will be confirmed when the scheme’s actuary finalises the detailed report in May, although it is not expected to change materially. The Department for Education will be consulting in April on implementation of the new contribution rate. The new employer rate will be payable until the outcome of the following valuation is implemented, which is expected to be April 2019. 

This news item has now been updated, click here for further information. Please direct any queries to the Department for Education.