The McCloud Remedy project remains on track for completion by the end of June 2026, despite a primary risk concerning the timely delivery of essential software from provider Civica. This risk is being actively managed through continuous dialogue with the software provider.
An update on key projects within the Shared Pensions Administration Service revealed that over 76% of employer data required for the McCloud Remedy has been matched and validated. The project is expected to transition from data validation to the rectification phase from April 2026, focusing on recalculating pensions and updating members' deferred benefits.
The McCloud Remedy addresses unlawful discrimination in public service pension schemes, ensuring that all eligible members receive the correct benefits. The project's progress was highlighted as a key success in the Pension Administration Projects Update report.
Anticipated Challenges and Financial Impact
The Governance and Risk Update
report lists a red rated risk concerning the failure by software provider Civica to provide compliant software, and outstanding issues with the software remain, and further patches are still expected.
The core risk is that until a fully compliant and tested solution is delivered, the Fund lacks a guaranteed operational system compliant with Local Government Pension Scheme (LGPS) regulations, which could lead to the incorrect payment of member benefits. This situation is being closely monitored.
Regarding the financial implications, the Pension Fund Business Plan 2026-29 and Budget 2026-27
document notes that the benefits budget has increased due to the annual pension increase and a provision for the McCloud Remedy. Furthermore, the Triennial Valuation and Funding Strategy Statement Update
estimates the cost to rectify the McCloud discrimination to be an increase in liabilities of £3m at this valuation. However, a comprehensive financial impact on public sector pension funds is not detailed within the provided information.
