The current employer contribution rate is 20.9% of pensionable pay for the 1995, 2008 and 2015 pension scheme. This equates to around two thirds of the cost of an individual's pension.
The employer contribution rate for the 1995, 2008 and 2015 schemes will increase to 22.5% of pensionable pay from 1 April 2024.
The employer contribution rate is set through a process known as the scheme 'valuation'. A scheme valuation is carried out every four years and it measures the full cost of paying pension benefits (to current pensioners). The most recent scheme valuation was carried out in 2020. The 2020 valuation concluded that in order to pay the current pension benefits from the scheme, an increase, of 1.6 per cent, in the employer contribution rate was required from 24/25. The results of the 2024 scheme valuation will determine the employer contribution rate required from 2027/28.
Pension contributions should be paid by the 19th of the month following deduction from members pay. Employers should log on to the online portal provided by SPPA to record contributions collected each month.
All scheme members are allocated to a contribution tier based on their pensionable pay. For most officer members the contribution rate to be applied is based on whole-time equivalent pensionable earnings for the previous scheme year. For practitioner and non GP provider members the contribution rate is set based on their current year earnings from all pensionable sources.
Contribution Table from 1 October 2023
Pensionable earnings band
Contribution percentage rate
|1||Up to £13,330||5.7%|
|2||£13.331 to £23,819||6.1%|
|3||£23,820 to £28,186||6.7%|
|4||£28,187 to £35,364||8.2%|
|5||£35,365 to £35,521||9.8%|
|6||£35,522 to £37,086||10%|
|7||£37,087 to £45,079||10.5%|
|8||£45,080 to £48,784||10.8%|
|9||£48,785 to £68,222||11.3%|
|10||£68,223 and above||13.7%|
For officer members changing or starting a new job part way through the year their contribution rate is based on estimated whole time/whole year pensionable earnings in the current year.
Employees new to the NHS will be allocated to a tier based on the whole-time equivalent salary and fixed allowances as at date of commencement.
The regulations do not allow members to be excused from paying contributions that are properly due. Care should be taken, therefore, to ensure as far as possible that arrears of contributions do not arise.