Cost Control Mechanism

The government commissioned the Government Actuary to assess whether, and to what extent, the employer cost control mechanism is meeting its original objectives. The cost control mechanism determines whether future benefit levels need to change, up or down, where member related costs change. The Government Actuary has now reported its findings and HM Treasury have launched a public consultation on proposed changes to the mechanism, aimed at making sure it better protects members, employers, and taxpayers appropriately when costs change.

SCAPE Discount Rate Methodology

HM Treasury have launched a review of the methodology used to determine this rate, which is used as part of the valuation process in determining the current cost of providing pensions into the future. The review meets a commitment made when the methodology was last looked at back in 2010 and is considering the extent to which the current arrangements meet objectives and whether alternative approaches would better meet them, including the need to provide stability.

Discussions with the Teachers’ Pension Scheme Advisory Board (TPSAB)

Both consultations could have a significant impact on the outcome of the 2020 valuation and the Department for Education is working with member and employer representatives via the TPSAB, as well as directly with HM Treasury and the other public service schemes to ensure the needs/views of stakeholders are fully recognised and considered.

Where can I find more information?

Both consultations run to 19 August and details can be found at the following links:

Cost Control Mechanism consultation (This link opens in a new window)

Discount Rate Methodology consultation (This link opens in a new window)