Changes to the SCAPE Discount Rate

On 30 March 2023, the Chief Secretary to the Treasury made a written ministerial statement confirming that the SCAPE discount rate has been adjusted to take into account the long term expected GDP growth figures published by the OBR in July 2022. Based on these figures the new SCAPE discount rate is CPI plus 1.7%, a reduction from CPI plus 2.4%.

The SCAPE discount rate is used to determine the actuarial factors which apply across all public sector schemes including the Local Government Pension Scheme (LGPS).  As such, with effect from 30 March 2023, we have been instructed by the Department for Levelling Up, Housing & Communities (DLUHC) to suspend the following calculations until new actuarial factors are issued:-

• Non-club transfers in to the LGPS.
• Non club transfer out of the LGPS.
• Interfund calculations when transferring from one LGPS fund to another.
• Refund cash transfer sums where service is greater than 3 months but less than 2 years.
• All cash equivalent values (CEV) for divorce. If we have previously provided a quotation for divorce purposes but the pension sharing order has not yet been made, you may need to notify the court to inform of the change in the CEV to be taken account in the financial settlement.

This will impact all new quotations as well as any existing cases where the original quote is out of guarantee, which is normally 3 months from the date of calculation.

We understand that the new transfer factors will be issued sometime in April/May, therefore, please bear with us in the interim period and we will process any requests as soon as we have the revised factors from the Governments Actuary Department.

We can continue to provide estimated retirement quotations with an effective date on or after 1 April 2023, but please note that the factors will be changing at some point over the coming months and so any final retirement figures may change as a result of this.