Winding Down Scheme Rules

The winding down scheme closed on 31 March 2022 so no new applications can be made by teachers. The rules set out below are for information and reference purposes only.

To take part in the Winding Down scheme applicants must have attained the age of:

  • 56 if your normal pension age is 60 or
  • 61 if your normal pension age is 65

Members must have attained a minimum of 25 years teaching service (for example, they must have had a contract to teach for at least 25 years) of which, the last 10 years must have been full-time service. A credit of up to five years for a break, or breaks, in service were acceptable and counted as qualifying service only (not for the calculation of benefits). Only teaching service qualified. If for example a winding down scheme member had transferred in service from the Local Government Superannuation Scheme, this service does not count towards the 25 years required. However service transferred from one of the other statutory teachers schemes did count. Service previously refunded from the STSS counted for qualifying purposes only.

Winding down employment must have been part-time service which is equal to or more than 0.5 full-time equivalent. Winding down employment allows each year of service under the part-time contract to count as one full year for pension benefit calculation purposes.

When winding down, full-time service equivalent contributable salary rate couldn’t be less than the teacher's salary rate prior to commencing the winding down employment.

The final pensionable salary, for benefit calculation purposes, was the salary that the member received in the 365 days prior to entering winding down employment, index-linked to the actual point of retirement.

This may not be the most beneficial as the index linked winding down salary may not provide a pension equal to or better than a pension based on similar part-time service and using the average of the best 3 out of the last 10 years’ salary.

The following did not count as teaching service:

  • previously purchased Past Added Years or Current Added Years (unless members were employed in a school or in an educational role supervising teachers outside the UK)
  • transfers in, unless from another Teachers’ pension scheme (for example, England and Wales, Northern Ireland, Guernsey, Jersey, Isle of Man or elsewhere outside the UK)
  • the purchase of Additional Pension
  • contributions payable

The contributions both the member and their employer paid were based on the actual salary they received for the part-time post.

It was only possible to remain in winding down employment for a maximum of 4 years and was only available up to 31 March 2022. Members must have retired at the end of the four year period although could retire before the end of the that period. Members who did not complete the four year winding down period by 31 march 2022 could continue to work part time in the 2015 Teachers scheme but would no longer accrue service at full time equivalent as the winding down scheme closed when the final salary schemes closed on that date. Any winding down service built up until 31 March 2022 could be retained.

If you return to full time teaching, it was not possible to retain the full time service credit awarded whilst the member was in winding down employment.

A teacher lost their service credit for winding down if they:

  • return to full time employment
  • exceed the 4 years maximum period
  • work less than a 0.5 contract
  • revoke their election in writing

If a member ceased to be in winding down employment and returned to teaching, the service credit during the period of winding down employment was removed and the service reverted to the part-time hours worked.

Members considering entering into a winding down arrangement were advised to take independent financial advice prior to entering winding down employment as once the pension is in payment it cannot be revoked. Members were also advised to check their benefits before retirement to find out if the winding down election was still more beneficial or if revoking the winding down election prior to applying for retirement benefits would offer more valuable benefits package.

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