Bulletin 7: Scheme Changes for Employers

The Government has confirmed that it will introduce changes, proposed in various recent consultations through 2026. The first phase of changes will come into force on 1 April 2026.

Our current understanding of the more imminent changes relevant to employers are listed below. 

Please note that the changes from 1 April 2026 have now been passed by Parliament and final regulations issued (see LGPS (Miscellaneous Amendments) (Member Benefits) Regulations 2026). However, we are still awaiting detailed guidance from Central Government.

From 1 April 2026:

APP to apply to unpaid additional elements of adoption/maternity/shared parental leave

• Assumed pensionable pay (APP) to apply during unpaid additional adoption leave, unpaid additional maternity leave and unpaid shared parental leave. APP will apply during these types of absences only if the unpaid period starts after 31 March 2026. The current rules will apply to any unpaid additional maternity or adoption leave, or unpaid shared parental leave that started before 1 April 2026 (please note these periods were previously not covered by APP and instead the employee had the option to buy back the lost Pension via an Additional Pension Contribution (APC) ). 

Compulsory pension contributions during first 14 days of authorised unpaid absence

• Compulsory pension contributions during authorised unpaid absences of 14 days or less, with contributions based on ‘lost’ pay and the member and employer’s normal contribution rates. This applies to authorised absences that start after 31 March 2026. The current rules continue to apply to an unpaid break that started before 1 April 2026.

Qualifying additional pension arrangements (QAPAs)

• the cost of buying back pension ‘lost’ during a period of authorised unpaid absence of more than 14 days to be based on the member and employer’s normal contribution rates. These contracts will be known as QAPAs.
• the time limit to apply for a QAPA will be one year after returning to work. This is an increase from the current limit of 30 days, but will only be possible while the member is an active member in the same employment
• allowing employers to contribute to the cost of a QAPA for the whole of an unpaid absence that lasts more than three years
• the pension bought through a QAPA will mirror normal pension built up: it will count towards the calculation of survivor pensions, and will not be reduced if the member retires on redundancy or efficiency grounds
• these new rules will only apply to a continuous period of authorised unpaid absence that started after 31 March 2026
• The existing rules will continue to apply to unpaid breaks that started before 1 April 2026 and those details are:
  • cost to buy ‘lost’ pension is based on Additional Pension Contribution (APC) age-related factors
  • employer funds two thirds of the cost if the member elects to buy the lost pension within 30 days of returning to work (or such a longer period allowed by the employer)
  • added pension reduced on redundancy or efficiency retirement before Normal Pension Age
  • the added pension does not count towards survivor pensions.

From 11 May 2026:

Access to LGPS for Elected Members

Following consultation, the Government has confirmed that it will proceed with plans to extend the LGPS to elected councillors and mayors in England. This change will give access to the LGPS to:

• all mayors and deputy mayors in England
• all elected councillors at principal authorities in England, and
• all London Assembly members.

The regulations are expected to come into force on 11 May 2026, which is the first Monday after the local elections.

Elected members who wish to join will be required to opt in to the Scheme from 11 May onwards, our understanding is that this means they would then be entered into the scheme from the first day of the payment period following the option to join, i.e. if opt in on 11 May 2026, they would join LGPS from 1 June 2026.