Heywood
Last updated: February 2026
The McCloud remedy has moved beyond policy interpretation. It is now a sustained delivery challenge that is reshaping priorities across public service pension administration.
Although remedy legislation came into force on 1 October 2023, implementation remains complex and resource intensive. Administrators are managing large-scale historic data reconstruction, technically demanding benefit comparisons, and prolonged member communications, often alongside pensions dashboards preparation, valuation activity, and day-to-day service delivery. For many schemes, McCloud is no longer time-bound and will remain an operational reality well into 2026 and beyond.
This guide provides a practical overview of the McCloud remedy, how it applies across schemes, where deadlines currently stand, and why data remains the critical constraint on delivery.
What is the McCloud Remedy?
Public service pension reforms in 2014 and 2015 introduced CARE schemes alongside transitional protections for members closest to retirement. In December 2018, the Court of Appeal ruled that these protections were discriminatory on the basis of age. This ruling, known as the McCloud judgment (and Sargeant in Fire schemes), applied across all public service pension schemes with similar arrangements.
The government accepted the judgment and legislated to remove the discrimination. The remedy period runs from 1 April 2015 to 31 March 2022. From 1 April 2022, all remaining members were moved into CARE schemes to ensure equal treatment going forward. Remedy legislation took effect on 1 October 2023.
The form of remedy differs by scheme. Most public service schemes operate a Deferred Choice Underpin, where members choose the most favourable benefits for the remedy period when benefits come into payment. In the LGPS, an automatic underpin comparison applies, delivering the better outcome without an active member choice.
How McCloud affects the LGPS
So why has McCloud proved particularly difficult for the LGPS?
The answer lies in how the scheme transitioned to CARE and, crucially, in what data was no longer required or collected at the time.
The McCloud remedy extends the underpin to all qualifying members with service in the remedy period. In England and Wales, this covers service from 1 April 2014 to 31 March 2022. Qualification depends on membership of any public service pension scheme on or before 31 March 2012, without a disqualifying break of more than five years. That qualifying service does not need to be in the LGPS.
The core challenge is data reconstruction. Administering authorities must now calculate benefits using information they were not previously required to hold. This has meant sourcing years of historic service data from large numbers of employers, many of whom no longer exist or hold incomplete records.
LGPS complexity is increased by aggregation rules, flexible retirement, concurrent employments, and excess teacher service. As implementation has progressed, further operational issues have emerged, leading to the government’s 2025 Access and Fairness consultation and expected follow-up legislation.
How McCloud affects police and fire schemes
At first glance, Police and Fire schemes might appear simpler. Fewer employers. Clearer service histories. So where does the complexity arise?
When CARE schemes were introduced in April 2015, members were fully protected, unprotected, or tapered.
Remedy has been delivered in two stages. All remaining protected members moved into CARE on 1 April 2022. From 1 October 2023, service accrued during the remedy period was rolled back to final salary service, with members given a Deferred Choice Underpin when benefits come into payment. Pensioners and deceased cases must be addressed as soon as reasonably practicable.
While these schemes do not face the same multi-employer data challenges as the LGPS, implementation remains demanding. Administrators must maintain parallel final salary and CARE records across the remedy period, including notional CARE records for fully protected members, at significant scale and precision.
Key deadlines and where things stand
Implementation timelines have proven more challenging than initially anticipated across all schemes.
For the LGPS, statutory guidance issued by Department for Levelling Up, Housing and Communities in June 2024 set a deadline of 31 August 2025 for most members, aligned with annual benefit statements including estimated underpin figures. The guidance allows administering authorities to extend implementation to 31 August 2026, and many funds are now using this discretion.
Other public service schemes face similar pressures. The statutory deadline for Remediable Service Statements was 31 March 2025, but legislation allows extensions where reasonable. Many schemes have relied on this flexibility. The NHS Pension Scheme has experienced significant delays, with revised delivery plans continuing into 2026. Police and Fire schemes have also extended timelines, particularly for complex cases.
Parliamentary debate in June 2025 acknowledged the scale of outstanding work. Regulators, including The Pensions Regulator, have signalled a pragmatic approach, while still expecting schemes to evidence progress, prioritisation, and control.
What remains uncertain is how long this extended implementation phase will realistically last. While current guidance allows flexibility into 2026, further legislative or regulatory adjustment cannot be ruled out, particularly as schemes surface issues that were not anticipated when the remedy was designed.
The data challenge
Everyone agrees data is the problem. The harder question is why it continues to be the problem so far into implementation.
Without complete and accurate service histories, underpin calculations cannot be relied upon. In some cases they will not run at all. In others, they risk producing technically valid but incorrect outcomes.
For LGPS authorities, this has meant large-scale historic data recovery from employers with changing systems, limited records, or no longer in existence. These exercises compete for resource with other major programmes, including pensions dashboards and valuation activity. Member-level complexity such as transfers, aggregation, and qualifying service in other schemes adds further risk.
This is where Heywood’s McCloud data services support schemes in identifying gaps, validating historic service data, and building a defensible foundation for underpin calculations.
Identifying members in scope is also challenging. Statutory guidance and Scheme Advisory Board advice provide frameworks for handling uncertain cases, but administrators are often required to proactively gather information from members where records are incomplete.
For Police and Fire schemes, the challenge is one of precision at scale, maintaining parallel benefit records across the remedy period and ensuring consistency through to benefit settlement.
Because McCloud arises from a binding legal judgment, accuracy is not optional. Poor data increases the risk of complaints, regulatory scrutiny, and future legal challenge.
How Heywood can help
Heywood has been working with public service pension schemes for over 50 years and has developed a suite of solutions specifically designed to support McCloud implementation.
Our McCloud data readiness dashboard, available through Heywood Insights, provides detailed analysis of member data with built-in validation, helping administrators identify gaps and track progress against deadlines. Within Altair, our pension administration platform, the ‘rectification’ data view drives underpin qualification directly from a member’s record, supported by powerful reporting and interface tools for extracting existing data and loading corrected information back into the system.
Beyond the technology, Heywood provides fully managed services to take the operational burden off in-house teams, including bespoke support for uploading and reconciling employer submissions, reviewing affected casework, and modelling rectification scenarios. We also support administrators in meeting their obligations around annual benefit statements and remediable service statements, ensuring compliant and accurate data is ready for members.
McCloud will continue to affect public service pension schemes until the last member with legacy service retires. With further regulatory change expected through Access and Fairness reforms, implementation pressure is unlikely to ease in the near term. Heywood continues to evolve its solutions to help schemes manage that reality and deliver accurate outcomes for members over the long term.
