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Finance and Public Administration Committee 17 March 2026 [Draft]

17 Mar 2026 · S6 · Finance and Public Administration Committee

Item of business

McCloud Remedy

Dr Stephen Pathirana (Scottish Public Pensions Agency) Watch on SPTV

Thank you, convener. Morning, everybody. Thank you for the opportunity to update the committee on the SPPA’s further progress in delivering the McCloud remedy. Since I last updated you in December 2025, Audit Scotland has published a section 22 report alongside the SPPA’s accounts and annual audit report. I would like to record that we welcome Audit Scotland’s unqualified opinion of our accounts and the recommendations in its annual audit report. We continue to work constructively with Audit Scotland and look forward to sharing with the Public Audit Committee later today the ways in which we are addressing areas for improvement.I would also like to reiterate the apology that I made when last before the committee for the delays in delivering the McCloud remedy. We have always sought to give accurate information to our members and, with the best possible intentions, shared estimated timelines that are based on our knowledge at the time. Knowing what we know now, we—and, I am sure, other pensions administrators—wish that we had communicated better earlier. We recognise that transparency must accompany delivery if members are to have confidence in the agency, and we will continue to report openly on progress.I would like to express my gratitude to our pension scheme members for their continued patience as we work to achieve the outcome that we all want—that is, everyone who is eligible having been offered and made their remedy choice and seen that choice reflected in their payments.Our members will still be able to retire and receive their full pension based on the rules that are in place at the time, and, in fact, we know that at least around 70 per cent of retired members are already on the scheme that is most advantageous to them.When it became clear to the United Kingdom Government that the original statutory timeframes were overly ambitious and had underestimated the scale of the challenge, it had a significant knock-on effect on pension providers, which meant that preparations inevitably fell short. As the scale and complexity of the remedy became apparent, that threw into sharp relief the reality that public pensions administrators were unable to respond as quickly or as effectively as we would have wished.Our pension system provider, along with others in the UK, could not carry out retrospective comparisons of benefits for individual members under both pension schemes, which is essential for remedy, and there was no off-the-shelf technical solution. To issue choice letters to about a third of our 600,000 members, we have had to develop our own solutions to make complex calculations and automate as much of the process as possible.Since I last appeared before the committee, we have continued to focus on delivering solutions to enable remedy service statements to go out to our retired members, including issuing our first choice statements for retired firefighters. As of yesterday, we had issued 37 per cent of these, exceeding our aim for the end of March.Advances that have been made in our pilots in the police scheme have achieved economies of scale that are benefiting firefighters, national health service and teacher schemes. For example, we have cut the time to process basic NHS pensions administration from two hours to less than half an hour through a new calculation module. In fact, we have made significant progress in delivering digital transformation over the past 12 months.Our on-going investment in people and information technology will help to deliver the remedy and raise service levels for members in future. We have digitised employer data for the police and fire schemes and we are actively onboarding employers into the teachers scheme, with full digitisation expected by the end of 2027.Since I last met the committee, we have launched a new member portal, Engage, across all four schemes. Its functionality is evolving and the portal will give instant access to a range of self-service options, pension information, historical documents, and scheme guidance. We have released an online pensions modeller for police and national health service members, which offers instant remedy compliant pension projections. The development of a modeller for the teachers scheme is in progress.As we look to the future, we are committed to completing the remedy and investing in the IT and data management services that are required to give the service to our members that they are entitled to expect from a modern pensions administrator.

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Finance and Public Administration Committee 17 March 2026 [Draft]

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