This note sets out how to calculate cash equivalent transfer values (CETVs), cash equivalents on divorce and pension credits using factors provided by the Government Actuary's Department (GAD) under:
- the Judicial Pensions and Retirement Act 1993 ('JuPRA')
- the Judicial Pension Regulations 2015 ('JPS2015')
- the Judicial Pensions (Fee-Paid Judges) Regulations 2017 ('FPJPS')
The factors in this note are suitable for calculating CETVs under the overriding Department for Work and Pensions (DWP) legislation (which also applies to the calculation of cash equivalents on divorce), under the Pension Schemes Act 1993 and the Occupational Pension Schemes (Transfer Values) Regulations 1996.
A Cash Equivalent may be paid by the scheme to another pension scheme calculated in accordance with the regulations.
The Judicial Pension Scheme 2022 ('JPS 2022') came into force on 1 April 2022. Accrual in the 1981 Judicial Scheme, JuPRA, JPS 2015 and FPJPS schemes ('the legacy schemes') ceased for future accrual with effect from 31 March 2022.
Our guidance assumes that the benefits payable in the legacy schemes will be calculated to the appropriate relevant date and will include known pension increases or the calculation of the accrued final salary pension with known salary increases (if applicable) as appropriate.
If the calculation of a CETV, pension credit and pension debit is required in respect of benefits accrued in JPS 2022 , please refer to our latest JPS 2022 guidance on CETVs and Pension Credits for details of the factors and methodology to use.
We understand that members eligible for remedy under the McCloud judgment will have already made their choice about the benefits that they have accrued during the McCloud remedy period (1 April 2015 to 31 March 2022, or date of retirement or leaving if earlier) in an options exercise carried out by Ministry of Justice (MoJ) and the scheme administrator.
Therefore, this guidance has been prepared on the basis that eligible McCloud members have already made their choice (i.e. whether to accrue benefits on a CARE basis under JPS 2015 or on a final salary basis under JuPRA or FPJPS for the remedy period) before the CETV calculation is performed. Where this is the case, benefits for the McCloud remedy period should be calculated using the relevant section of this guidance appropriate to the remedy choice made. No additional adjustment needs to be made to the CETV to account for a McCloud choice.
Where a member is affected by McCloud any benefits accrued before 1 April 2015 and/or after 1 April 2022 for these periods of service should be calculated in line with the relevant section of this guidance note or the JPS 2022 CETVs and Pension Credits guidance note.
If you require guidance relating to the calculation of a CETV or pension credit/debit for an eligible McCloud member who has yet to go through the McCloud options exercise, please refer the case to GAD.
The "CETVs and pension credits in JuPRA" and "Special Cases" sections and the relevant Judicial Pension Scheme factor tables should be used to calculate the CETVs, pension credits and pension debits to be awarded when a member wants to transfer out of JuPRA or is a member with JuPRA benefits who requires a CETV quotation for divorce purposes.
The "CETVs and pension credits in JPS2015" and "Special Cases" sections and the relevant New Judicial Pension Scheme factor tables should be used to calculate the CETVs, pension credits and pension debits to be awarded when a member wants to transfer out of JPS2015 or is a member with JPS2015 benefits who requires a CETV quotation for divorce purposes.
The "CETVs and pension credits in FPJPS" and "Special Cases" sections should be used to calculate the CETVs, pension credits and pension debits to be awarded when a member wants to transfer out of FPJPS or is a member with FPJPS benefits who requires a CETV quotation for divorce purposes.
A member may have benefits in more than one scheme. Where this is the case, benefits for each scheme should be calculated separately using the relevant sections of this guidance and the guidance found in the JPS 2022 CETV guidance note as applicable.
Note that the value of Judicial Service Awards is not included in CETVs or cash equivalents on divorce as calculated in this note. If information on Judicial Service Awards is required for any purpose, it would need to be calculated separately.
The following changes have been made when reviewing this guidance:
- Important information around the expected audience for the guidance, use of the guidance, review of factors, compliance and limitations applies across all sets of guidance. Rather than being repeated in each set of guidance, this can now be found on the scheme home page. It is important to read this information alongside the guidance.
- Calculation methodology: No changes have been made to the calculation methodology.
- Examples: There are no examples in this guidance. Worked examples, using the calculation methodology, can be found in prior versions of the guidance (though please note that these use historic factors).
- Factor tables: The "Factor Tables" tab contains the names of the tables that are referenced in the calculation methodology. The tables of factors themselves can be found in the most recently published "Consolidated Factors Workbook" which is available by clicking the "Download current Consolidated Factors Workbook" button on the scheme's home page.
- Assumptions: The key assumptions underlying the factors in each note are contained in the Consolidated Factors Workbook.
- Regulations: The regulations that require the production of the actuarial factors and/or guidance that is the subject of this note are summarised in the "Regulations" tab.
