From 6 April 2015 the Pension Schemes Act 2015 has placed a restriction on transfers-out from unfunded Defined Benefit Public Service Pension Schemes to schemes from which benefits can be accessed flexibly.

A transfer-out of benefits to such schemes is no longer permitted unless the member has not completed the qualification period for pension benefits but has more than 3 months service (this does not apply where the all the service is prior to 1 January 1986).

In order to process applications ahead of the deadline a fully completed Discharge Form 350 was required no later than 5 April 2015.　 The Teachers’ Pension Scheme allowed for an increased number of transfer-out applications to be processed in the run up to the deadline by:

• Increasing the capacity of the dedicated transfers administration team
• Placing a time-limited moratorium on transfers to Defined Benefit schemes in order to focus resources on applications for transfers to Defined Contribution schemes
• Relaxing the policy to allow for date of birth to be verified using notified copies rather than original documents
• Allowing for faxed copies of the Discharge Form 350 rather than the original (as long as the original is received before 30 April 2015.)

Teachers’ Pensions also took a series of steps to notify members of the upcoming deadline by:

• Including a statement on the upcoming legislative changes on letters acknowledging the receipt of the application;
• Writing out to members or their nominated representatives to advise when we could not immediately provide a GTV as further information was required;
• Following up non-responses to third-party information requests; and
• Liaising with HMRC to avoid unnecessary delays in obtaining information on Guaranteed Minimum Pension liability, required for the GTV calculation.

In making the decision to restrict transfers from unfunded Public Service Pension Schemes, the Government had to consider both the interests of members and those of other taxpayers. Continuing to allow such transfers after the introduction of the new pension flexibilities could have exposed the Government to upfront direct costs, leading to either higher taxes or more debt. In light of this, the Government took the view that the balance of interests was in favour of restricting transfers.

Public Service Pensions remain good value to both their members and to the taxpayer, and members who choose to move abroad to work or retire will continue to be able to access their pension, and will continue to have their benefits increased in line with prices. These changes do not affect that.