Government confirms annual public service pension increase rate

The government has announced the rates of indexation and revaluation that will be applied to public service pensions in April 2022.

In a written statement, Chief Secretary to the Treasury, Simon Clarke, noted that public service pensions are required by law to increase annually in line with the state pension.

Public service pensions will therefore increase in line with the 3.1 per cent rise in Consumer Prices Index (CPI) on 11 April 2022, except for those that have been in payment for less than a year.

Separately, pensions in accrual in the career average revalued earnings public service pension schemes introduced in 2014 and 2015 are revalued annually in relation to either prices or earnings, depending on scheme rules.

The schemes that rely on a measure of prices will use the CPI of 3.1 per cent for the prices element of revaluation.

This applies to the civil service, the Local Government Pension Scheme, and the judiciary.

Public service schemes that rely on a measure of earnings will use the figure of 4.1 per cent for the earnings element of revaluation, which applies to firefighters and the armed forces.

The revaluation figure for the police stands at 4.35 per cent, at 4.6 per cent for the NHS and at 4.7 per cent for teachers.

Clarke stated: “Revaluation is one part of the amount of pension that members earn in a year and needs to be considered in conjunction with the amount of in-year accrual.

“Typically, schemes with lower revaluation will have faster accrual and therefore members will earn more pension per year.”

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