HM Treasury announce changes affecting transfer, divorce and retirement calculations
On 19 May 2026, HM Treasury announced changes to the actuarial assumptions used for members of public service pension schemes. This includes the Local Government Pension Scheme (LGPS), which the EAPF is a fund of, and means that the factors used for a range of pension calculations in the LGPS will be changing.
These changes will affect members who want to:
- Retire before or after their Normal Pension Age (NPA)
- Transfer their previous private sector pension rights into their public service pension scheme (applicable only to contributing members)
- Have a Cash Equivalent Transfer Value (CETV) of their pension rights, to investigate the possibility of transferring their public service pension rights to a non-public service pension scheme
- Have a Cash Equivalent Transfer Value (CETV) of their pension rights for divorce purposes
Due to these changes in calculation factors, as a precaution (and at the Local Government Association’s recommendation), we took the following actions:
- Placed a ‘hold’ on cases for contributing members wishing to transfer previous private sector pension rights into the EAPF
- Placed a ‘hold’ on cases for members wishing to have a CETV of their pension rights (this hold has now been lifted as new calculation factors were issued for these cases in early June).
- Inserted a paragraph in all retirement option/quotation letters, to ensure members are made aware that the early/late retirement reduction factors used in the calculations will soon be changing
- Placed a warning message on the contributing member Retirement Illustrator page in the EAPF Online portal, to ensure members are made aware that the early/late retirement reduction factors used in the calculations will soon be changing
The Government Actuary’s Department (GAD) who are responsible for producing new factors released the first batch of new factors at the beginning of June, which means that CETVs can be calculated.
However, at the time of writing, we don’t have confirmation of when the new factors affecting early/late retirements will take effect, or whether any transitional arrangements will apply to members retiring around the implementation date.