Getting A Grip On Pensions

As we are all well-aware, there are many serious on-going problems with every part of probation since it was split in two by Chris Grayling and continues to hemorrhage disgruntled but experienced staff on a daily basis. Here's Napo Assistant General Secretary Dean Rogers writing recently about the thorny issue of pensions in the NPS. At first sight it might appear a bit of a nerdy topic, but this is surely the sort of bread and butter stuff you'd expect a trade union to be getting to grips with:-  

NPS Pension Faultline and the Next Steps for the NPS

Since before the transfer of staff to the NPS and CRCs, I have been raising concerns about the contractual sustainability and HR problems inevitably arising from probation staff becoming civil servants continuing to be members of the Local Government Pension Scheme (LGPS) – and as such, not having any right to be members of the Principle Civil Service Compensation Scheme (PCSPS).

Napo recognise and have never opposed the reasons for the separation – primarily the extraordinary cost of transferring pension liabilities, combined with the practical need to reassure transferees that they would suffer no pension loss upon becoming civil servants.

However, it wasn’t long before these concerns become self-evident. The depth of the problem, in there being a core difference in probation staffs’ terms and conditions from those of all other staff employed directly by NOMS or the MoJ, shouldn’t be under-estimated, especially with the MoJ ever more determined to align rehabilitation practice and delivery more closely across probation and prison settings.

The problem has come to ahead with the discovery by unions, of the widespread failure to collect or pay employee and employer contributions on potentially thousands of NPS staff pay since the new Single Operating Platform, or SOP was turned on in February 2017. The shortfall to the pension will be in the high £100,000’s. We also believe there are auto-enrolment issues in the NPS – staff transferring in from CRCs being wrongly enrolled in the civil service scheme then taken out of the pension system altogether after the error was identified, a criminal act from the Ministry of Justice! The damage to the credibility of the NPS as an employer at a point of huge recruitment difficulty could be impossible to calculate.

Additionally, we’ve had many grievances and personal cases brought by Napo members since the split when seeking to access elements informed by the LGPS – for example, the confusion about partial retirement rights, processes and obligations; application of the 85 Year Rule and discretions; or staff simply seeking to clarify their entitlements prior to retirement and being wrongly directed towards the civil service pension operator, MyServices and advice specifically relevant to the PCSPS.

Further confusion has arisen from the wider application of the PCSPS to non-pension specific related exit and compensation terms. The LGPS is a funded scheme and as such, without looking like Maxwell or Green, the scheme cannot be raided for redundancy or any other purpose beyond paying pensions (although there are LGPS rules which afford members being made redundant over the age of 55 rights to immediately access their pension at protected terms; as well as protected terms afforded under Ill-Health Early Retirement Rules within the scheme which differ in specific aspects from the PCSPS equivalents).However, the PCSPS is and always has been, a unfunded scheme and as such is freer of such restrictions. “Pension speak” is routinely used and applied interchangeably with language about compensation, redundancy etc.

This problem of different language has cropped up consistently and has been amplified by the Shared Service Centre model, (aka SSCL) which is at the heart of all HR advice and support to line managers. The SSCL concept only works where basic assumptions the computer makes are shared and common. When these basic assumptions differ then the systems literally crash, or worse, try to make up an answer that ends up multiplying the problem – a case of “artificial stupidity”. We have seen the SSCL struggle to cope with any differences of process, pay, leave, expenses, etc. However, whilst it is plausible, at least in theory, to try to address these via harmonising NPS staff onto common terms (and even potentially pay rates) that in some way mirror or align with the rest of the MOJ, we can never fully integrate and harmonise because of the pension conflicts. In short, this is a big problem that isn’t going away whilst staff are in separate pension schemes and staff will have to remain in separate schemes until HM Treasury picks up an extraordinary bill for liabilities.

The urgency of recognising this now is even greater as a result of the proposed new civil service compensation arrangements and caps. These will, following the PCS Court victory recently, now presumably need to be re-negotiated.

However, in light of that verdict, the MoJ will also need to decide if NPS staff are:
included in these terms – in which case Napo and Unison must be a party to all the relevant negotiations and we will have to pick through the pension issues in a collective setting or; specifically excluded from all caps and any relevant changes – in which case we will need to decide what aspects of the civil service code will need to be adapted to recognise this difference.

ALTERNATIVE

There is an alternative – namely, breaking the NPS out of the MoJ SSCL systems. If the NPS was to become a Next-Steps Agency with greater autonomy to operate independently of the failing SSCL contract then many of these issues would dissolve. A more independent status for the NPS would also boost morale and potentially boost the profile and status of probation at a critical time professionally, without compromising the accountability of staff as crown servants and/or civil servants.

Indeed, Cafcass already provide a model for this within the MoJ family, having become adopted cousins on transfer from the DfE in 2015. Cafcass staff are bound by the same professional standards and accountabilities as civil servants (indeed even more so given the license to practice that also applies to them as social workers and which is another good idea probation could borrow) but Cafcass staff are members of the LGPS and they have separate pay and grading structures.

Napo recognises that politically this will be a challenging proposition from the MoJ – given they are seeking to place rehabilitation principles at the heart of the HMPPS, and are proposing more NPS employees working alongside prison service colleagues, mentoring and coaching them towards more enlightened practice. However, our argument must be that this aspiration will be hindered not helped by the continuing fault-line at the heart of our members’ terms and conditions arising from the different pensions schemes.

We would argue that greater co-operation and assimilation is best served (and possibly can only be served) by recognising this difference and finding ways of safely bridging it. This can be done by a combination of three things that are supposedly being considered already, namely:

A. Probation pay reform, recognising the gap that has arisen as a result of failed pay progression and providing more equitable and competitive pay rates for probation staff to comparator workers, not just in the MoJ but across police, courts, social work and the private and/or third sectors – something which is currently happening anyway.

B. Introducing a unified national set of professional standards underpinned by a Rehabilitation License to Practice – this is also already under consideration and is in our view essential to ensuring common professional standards and expectations across diverse private and public sector providers. With common standards and personal accountability arising from the introduction of a licensing system then closer working collaboration and co-operation between staff employed by different bodies must become easier – as seen in health and social work.

C. A clear and agreed set of secondment arrangements allowing staff to move between bodies and establishments without upsetting their terms and conditions – this could also be the easiest way of ensuring frequent movement (for example between custodial and community settings) without hitting huge terms and conditions issues and the pension fault-line constantly being problematic.

In effect, A, B and C are already desperately needed. Meeting them against the context of establishing the NPS as a more independent body will be easier and more sustainable, as opposed to trying to meet them whilst seeking to cajole and persuade probation professionals to assimilate into the prison centric HMPPS. Re-constituting the NPS as a Next-Steps Agency, and stabilising the risks associated with the pension fault-line, is much safer and easier than trying to force the pension fault-line into the HMPPS.

Closer working and assimilation of probation staff into the HMPPS around an otherwise broadly similar set of professional standards, pay rates and terms and conditions is much safer with a semi-independent NPS, holding on to its LGPS membership, than trying to force a square and funded pension scheme into a round and unfunded hole.

Dean Rogers
Assistant General Secretary