The Government has confirmed that independent schools can opt for a “phased withdrawal” from the Teachers’ Pension Scheme from 2021 onwards.
Under the DfE’s plans, which will come into effect in spring next year, current teachers in private schools will remain in the current TPS but will allow alternative pension arrangements to be offered to new starters.
The development is in response to a 40 per cent increase in the amount employers have been expected to pay into the schemes since September 2019.
Although the extra pensions cost for teachers in the state sector was picked up by the Government, schools in the private sector had to fund the increase from their own resources.
Following a consultation with the private education sector, pension rules are to be softened, with the Government stating that the phased withdrawal proposal is “likely to result in more teachers at independent schools retaining TPS membership than if the proposal was not implemented”.
As pension rules currently stand, independent schools that seek the Government’s permission to withdraw from the TPS must apply the withdrawal to all staff.
To date, more than 170 private schools have left the TPS, following the rise in pension costs, resulting in incidents of industrial action and fears that staff could leave the independent sector.