The McCloud Remedy project, aimed at rectifying age discrimination within the Local Government Pension Scheme (LGPS), has failed to meet its completion deadline, prompting the Kingston upon Thames Council's Pension Board to notify the Pensions Regulator.
The project, which involves recalculating pension benefits for eligible members to ensure they receive the higher of the old or new scheme rules, has been delayed due to industry-wide software issues. The Kingston Pension Fund estimates that 3,483 members are in scope for the McCloud Remedy. However, being in scope does not automatically mean a member's benefits will change; a key part of the project is to perform the necessary calculations to determine which members will see an increase.
Tom Taylor, Head of Pensions Administration, informed the board that the project's revised completion date is now January 31, 2027. He explained that the Fund had reported itself for a breach of the law to The Pensions Regulator due to the delay in issuing McCloud-compliant annual statements. To date, the regulator has only provided acknowledgement, and the fund is not expecting sanctions, though they will keep the board updated.
Software Delays and Industry-Wide Impact
The implementation of the McCloud Remedy is being delayed due to industry wide software delays
from the administration system provider. Specifically, testing by Public Sector clients has revealed several issues within the software release(s)
which prevent the system from performing accurate McCloud calculations.
The provider has notified that these defects will be addressed via a series of subsequent software patches,
but the delivery date for this software is currently to be confirmed.
This is an industry wide issue affecting a large number of public sector pension funds, who are collectively pressing their software providers to deliver the essential system upgrades.
The Kingston Pension Fund is actively engaged with its provider and other LGPS funds to expedite the necessary software updates. A red
rated risk remains concerning the software provider's failure to deliver compliant LGPS regulations software, which has led to the reported breach to The Pensions Regulator.
Mitigation and Contingency Plans
The 'red' rated risk is being mitigated through hold[ing] regular meetings with the software provider to monitor progress
and agree[ing] on a delivery schedule with the software provider.
There is also a formal method of escalation with the software provider if key milestones are missed.
Contingency plans are in place for members retiring or passing away before the project's completion. Procedures are in place to ensure any members retiring in the interim will have their benefits calculated correctly using the established workarounds.
The report also mentions that the standalone calculator for immediate retirement and death cases
is being used to ensure compliance for new events.
Despite the setback, Taylor assured the board that all members in scope of the McCloud Remedy would receive updated communications and, upon project completion, revised statements detailing any impact on their pension benefits.
The delay is attributed to the complex nature of the LGPS regulations and historical data requirements, which have impacted software providers across the sector.
Public reports pack Wednesday 14-Oct-2026 10.00 Pension Board.pdf