Academy status

Once set up as a new employer within the Pension Fund, the Academy will be treated in complete isolation from its related Unitary Authority for pension purposes.

Since 1 April 2014, and following the triennial valuation as at 31 March 2013, the Actuary has pooled all academies together for the purpose of calculating an employer contribution rate. It is likely that an Academy will have a different employer contribution rate to schools remaining as part of the Local Education Authority (LEA).

The 2022 valuation report shows the full list of employer contribution rates from 1 April 2023 to 31 March 2026.

The correct rate of both employee and employer contributions must be deducted from each scheme members' pay bearing in mind that contributions are deducted before tax, i.e full tax relief is given on pension contributions.

The pension contributions must be paid to the Pension Fund each month and by the 19th day of the following month in respect of which the contributions have been deducted. A breakdown between the employee and employer contributions must be provided when each payment is made.

The Academy will also be required to provide an annual return for reconciliation purposes setting out the total amount of employee and employer contributions in respect of each scheme member (and each pensionable post held by an employee) for the period 1 April to 31 March each year.

Pension Administration - Employer responsibilities

If an Academy continues to use the payroll and HR services of their respective Unitary Authority there will be little difference to the administrative processes already in place.

However, as it is likely that an Academy will appoint an external provider for payroll and HR services, there are many issues that need to be considered and are the responsibility of the Academy as the Scheme employer:

Provision of day-to-day paperwork for pension administration purposes including:

• Details of new employees joining the scheme
• Contract variations e.g. hours changes, breaks in service
• Details of leavers and retirements including final pay calculations

Employer decisions including:

• Policy making in respect of employer discretions available within the LGPS
• Awards of benefits including ill health retirements and the use of an Independent Registered Medical Practitioner (IRMP)
• Dealing with disputes under the Internal Resolution Disputes Procedures (IDRP)

Further details will be provided by way of a Service Level Agreement between the Academy and the Royal County of Berkshire Pension Fund.

It is important to realise that it is an Academy that becomes a Scheme employer of the Pension Fund and not the appointed payroll/HR provider. An Academy will need to be very clear when appointing any external provider of these services as to where the responsibilities lie and to ensure that they enter into a contract that is sufficiently robust to meets the needs of the pension administration service level agreement.