Earlier this month the Department for Education (DfE) published the responses to its consultation on the application of New Fair Deal to the Teachers’ Pension Scheme (TPS) and took the opportunity to re-iterate its view on the application of New Fair Deal in the HE/FE sector.

New Fair Deal is non-statutory guidance issued by HM Treasury setting out how pensions are to be dealt with when staff are compulsorily transferred under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) from the public sector to independent providers delivering public services. The guidance states that such staff should continue to be members of the public service pension scheme they were in immediately prior to the transfer, thereby allowing them to continue in membership of that scheme for future service, notwithstanding the change of employer.  A copy of New Fair Deal guidance can be found here.  New Fair Deal only applies to certain public sector bodies but was also, in somewhat of a surprise move, extended so as to apply academies. That adds an extra dimension in the context of possible outsourcing arrangements being contemplated by those institutions and their proprietors.

The move to catch academies raised questions as to its application in the HE/FE sector. Union respondents to the consultation by and large felt that New Fair Deal arrangements should be applied universally, so that all members who currently work in the HE/FE sectors would be covered by New Fair Deal. However, the Government's response to the consultation re-iterates that New Fair Deal will notbe mandatory in the HE/FE sector but that employers will be able to elect to apply the arrangements if they wish to do so. That said, HM Treasury have suggested a review after two years to re-consider the issue against numbers of HE/FE institutions that have elected to apply New Fair Deal - so that may well not be the end of the matter.

 The full Government response can be found here..