Napo have received a large number of enquiries from members who have expressed concern about the impact of the reduction in employment contributions to the Greater Manchester Pension Fund (GMPF) for those Probation employees in England and Wales who are in this particular Local Government Pension Scheme.
We share our understanding of what’s happened, how it doesn’t affect your pension benefits and what we expect next from the employer involved.
Who is the Greater Manchester Pension Fund
The pension fund for the vast majority of our members working in the Probation Service in England and Wales is the Greater Manchester Pension Fund (GMPF)
What’s happened?
Napo members in this pension fund have noticed that their latest payslip shows a reduction in the percentage which the employer contributes to their pension contribution (from 26.5% to 18%). The important thing for members to know is that this change in the employer contribution rate in these circumstances has no impact whatsoever on the accrual of your pension benefits.
The Actuary of a pension fund is responsible for assessing and managing the financial risks of pension plans. It’s not HMPPS that sets the contribution rate, that’s the responsibility of the Actuary, as they are legally required to make sure GMPF have enough money to pay all the pension benefits that have been built up in the past, plus those that will be paid to us in the future.
For GMPF, the Actuary reviews the scheme every three years. If the money GMPF holds falls below the amount needed to meet their pension commitments, employers have to make up the shortfall by paying more. If GMPF has a surplus of funds, then the actuary may reduce employer contributions, as has happened this year and when the last review took place in 2023.
This is completely separate to the recently agreed and hugely delayed 2025/26 pay deal, and the timing is simply a genuine coincidence.
For any members who want to know more about this change then, as is our advice for many issues pension-related, we’d recommend looking at the relevant section of the GMPF website
What is Napo doing about this?
As a trade union we don’t have any collective bargaining rights to negotiate with GMPF directly, and this was the first we were aware of this change too.
The decision by HMPPS not to advise the trade unions, or its employees involved, in advance of this development is yet another serious failure in basic communication with it’s workforce.
We’re raising this urgently with the employer. When this last occurred, three years ago, HMPPS later attempted to claim that they needed to check that the changes had been actioned through SOP properly first. This wasn’t an excuse that was credible or serious then, so it’s to be hoped they come up with a better explanation or simply apologise.
7 responses
Hi i am with this pension provider and my income is incorrect
thanks for the clear explanation Napo – can’t believe that HMPPS didn’t think we’d want to know this and definitely not holding my breath for that apology.
Thank you for looking into this but it does seem to me that they have given us 6% and gained 8% from the pension contribution. So even with break even we should have got an larger pay increase. Please bear this in mind for the next negotiation. This pay increase has not actually cost our employer anything!! I know it is not that simple in actuarial terms but they have done OK out of this.
At what point do we consider these to be continuous breaches of the employment contract? This alongside the failure to pay CBF on time, and working for a year without a pay deal must come to an end. I feel that I can no longer trust the service to support me, and will be looking at the wider Civil Service for employment should this continue for any longer.
It may have been helpful to explain that our pension scheme isn’t a personal “pot of money” that we pay into and then get back later. I’ve only recently understood this myself. The amounts we and the employer pay each month are essentially a membership fee for the scheme, rather than individual savings.
What we receive in retirement is not based on how much has been paid in, but on our salary and the number of years we have been a member of the scheme. From that perspective, the exact percentage the employer contributes each month doesn’t really matter at an individual level.
I think the confusion comes from the employer contribution being advertised as “really good”, rather than being clear that the pension benefit is calculated based on pay and length of service, not the size of the contributions
Thank you for explaining this, I fully understand now because I did not know this is how the pension fund works. Thank you 🙏
Should this not just be for new employees? Surely this is a breach of employment contract?
Im sure this is similar to what happened in the Police and the solicitors working on behalf of cops who got the solicitor involved had it recitified as it was agreed it should have only been for new employees and those that had retired got a lump sum due to this.