Why Were Police Pension Quotes
Suspended in May 2026?

The short version: Many pension calculations, including transfer values and 1987 lump sums, use actuarial factors set by GAD. When the Treasury changed the SCAPE rate and revised its CETV guidance with immediate effect, the existing factors no longer matched the assumptions the schemes must use, and the new factors had not yet been issued.

Why the old factors could not be used: The NPCC said that until updated factors were issued, values calculated on the previous factors might no longer be accurate and could be too high or too low, so calculations were paused to make sure members received reliable figures. It added that the 1987 rules require lump sums to reflect the correct actuarial value at retirement, so once factors are updated the previous ones cannot continue to be used for new retirements (NPCC FAQs 11, 21 and 25).

Urgent cases: The NPCC said that in some urgent cases a provisional transfer value could still be provided, clearly marked as subject to change once the updated factors were available.

How long it lasted: It depended on the factor. New police 1987 commutation and CETV factors were issued on 21 May 2026, GAD says every public service scheme had new CETV factors within 11 working days, and some less-used factors (such as transfer-in factors) took until July. When your own administrator resumed issuing figures depended on its systems; we could not find a published resumption date for each force.

The short version: To understand the impact of the suspension, it is helpful to clarify what a pension quote actually is. An administrative pension forecast, or quote, is a formal document that projects your retirement benefits based on your current service history, salary scale, and intended retirement date.

These statements detail your standard annual pension, your maximum tax-free lump sum, and the commutation choices available to you. For transition officers, the quote also models the impact of the McCloud Remedy, showing the difference between legacy and CARE benefits for the remedy period.

Why accuracy matters: Because these documents are used to make permanent retirement decisions, they must be accurate. A change in a commutation factor can make a difference of thousands of pounds to a lump sum. This is why calculations were paused until the new GAD tables were issued.

Quote vs annual statement: Unlike the Annual Benefit Statement (ABS) which provides a generic estimate at a fixed point in the year, a formal pension quote is a bespoke calculation generated for a specific retirement date. It takes into account exact final salary figures, accrued CARE revaluation amounts up to the final month of service, and any outstanding pension sharing or purchase arrangements.

Quotes are not guarantees: The NPCC says pension estimates are not guaranteed and are based on the factors in place when they are produced; when national assumptions change, updated figures must be used. In the 1987 scheme, notice to commute can be given from 4 months before to 6 months after retirement (reg B7(5)), so officers near their exit dates needed updated figures before deciding.

The short version: A Cash Equivalent Transfer Value (CETV) represents the lump sum cash value of your accrued pension benefits. It is the amount that the scheme would pay to transfer your benefits to another registered pension arrangement.

CETVs are normally used in divorce proceedings to value pension rights, including for pension sharing orders. They are also used by officers looking to transfer service between schemes.

Why CETVs were paused: CETV calculations depend on the discount rate, so the May 2026 SCAPE change had a direct impact on them. A higher rate means future pension payments are valued lower today, so CETVs may be lower than under the previous factors (NPCC). HM Treasury revised its CETV guidance with immediate effect on 19 May 2026, and calculations were suspended until GAD issued new factors; for police schemes in England and Wales, GAD issued them on 21 May 2026.

Divorce proceedings: When a marriage or civil partnership ends, a police officer's accrued pension rights are often a significant part of the financial picture, and the scheme's CETV is the usual starting point for valuing them.

The NPCC said CETVs for divorce were affected in all schemes and that values given during the change period might be provisional. A CETV issued before 19 May 2026 used the old factors, so if your case relies on one, ask your solicitor whether an updated figure is needed.

The Government Actuary's Department is the scheme actuary for the police pension schemes. The 1987 regulations require a commuted lump sum to be the actuarial equivalent of the pension given up, calculated from tables prepared by the Government Actuary (reg B7(7)), and GAD reviews the tables to maintain that equivalence.

Commutation factors are calculated on an actuarial present value basis, allowing for expected future pension payments including pension increases, the timing of payments, mortality, and a discount rate (GAD letter, 21 May 2026, section 3). Because the discount rate went up, the present-day value of future pension payments fell, so the factors fell.

The new factors: GAD's new 1987 table uses a discount rate of 2.0 percent a year above CPI, in line with the SCAPE rate, and updated mortality improvement assumptions. For example, the factor at exactly 50 fell from 26.90 to 25.55, and at 55 from 24.30 to 23.22. The table runs from below age 48 (ill-health retirements only) to 75.

Timing: GAD issued the new 1987 tables on 21 May 2026, two days after the Treasury announcement, and they came into force immediately. GAD says there is no set timeframe for its reviews and that it does not release details until revised factors are issued, at which point they take effect.

The short version: A common question is why administrators could not keep issuing figures on the old tables while waiting for new ones. The NPCC's answer is that once updated factors are in force, administrators cannot apply the previous ones, because the rules require the lump sum to reflect the correct actuarial value at the point of retirement.

What if the wrong factors are used? The NPCC says that if benefits are calculated using incorrect factors after updated ones have come into force, this is likely to be treated as an administrative error; any overpayment would be considered under the scheme manager's usual processes, and any decision to recover overpaid amounts would be proportionate and based on individual circumstances (NPCC FAQ 24).

What about quotes already given? The NPCC said quotes based on the previous factors for retirements on or after 21 May 2026 may need to be reviewed, members would be given the opportunity to review a lump sum decision before retirement, and final figures would only be confirmed once the correct factors were applied. The Police Federation of England and Wales says officers who had already made an irrevocable choice of benefits and retired on or after 21 May 2026 may have a maladministration complaint, through the force's internal dispute resolution procedure and then the Pensions Ombudsman.

What we could not verify: We found no primary source for claims that paying out on the old factors would have triggered unauthorised payment tax charges or Pensions Regulator penalties, so we do not repeat them here.

Why the fear arises: A common source of concern is the fear that pension benefits are being lost. When news of a GAD factor reduction spreads, it triggers immediate concern that the government is clawing back benefits.

What the sources say: The NPCC confirmed that the change does not reduce the pension you have built up or pensions in payment. For the 2015 scheme, section 23 of the Public Service Pensions Act 2013 requires the consent of affected members or their representatives before scheme regulations can make retrospective provision with significant adverse effects on pensions.

The core annual pension you built up under legacy or CARE rules was not reduced by the May 2026 change.

Factors are different: Actuarial factors (commutation, transfer values, early and late retirement) are not accrued benefits. GAD reviews them when it judges necessary and they take effect when issued, which is why a 1987 lump sum can change even though the pension does not.

Annuity vs factor: It is crucial to understand the difference between the core annual pension annuity and the commutation factor. The commutation factor is the exchange rate at which you choose to swap a portion of your annual pension for cash. While a change in the commutation factor alters the size of the tax-free cash lump sum you can receive, it does not touch the underlying annual pension amount you have accrued.

In fact, if you choose not to commute any 1987 pension, your 1987 pension is not affected by the commutation factor change. (A 2015 pension taken before 60 is reduced using early payment factors, which GAD revised from 1 August 2026.)

The legacy PPS 1987 scheme relies on GAD commutation tables to work out cash lump sums. Unlike the 2015 scheme, it does not use a fixed ratio, so its lump sums change when GAD revises the tables.

When the SCAPE discount rate was increased, GAD reviewed and lowered the 1987 commutation factors, so each pound of annual pension surrendered now generates less cash.

Worked example (illustrative, not a real case): an officer retires at exactly 50 under the 1987 scheme with a final salary of £50,000 and 30 years of service, giving the maximum pension of 40/60ths, £33,333 a year. The scheme lets them commute up to a quarter of it, £8,333 a year.

What the factor change does to their cash:

• At the age-50 factor in force until 20 May 2026 (26.90), commuting the full quarter would have produced about £224,167; at the factor in force from 21 May 2026 (25.55) it produces about £212,917, about £11,250 (5.0 percent) less.
• But HMRC's tax-free maximum, 20 × factor × pension ÷ (20 + 3 × factor) (PTM063240), is lower than both: about £178,087 under the old factor and £176,237 under the new one. An officer taking only the tax-free maximum loses about £1,850 (1.0 percent).
• Their remaining annual pension after commuting the full quarter would be £25,000 either way; commuting only the tax-free maximum leaves more pension.

The 2.25 times cap: With under 30 years' service, a 1987 ordinary pension's lump sum cannot exceed 2.25 times the pension (reg B7(4)(b)). For officers at that cap, the lump sum does not fall; they give up more pension to get it.

Other schemes: The 2006 automatic lump sum and the 2015 rate of £12 per £1 are set in the regulations, so they did not change. Other factors for those schemes did (see the timeline).

The short version: The reformed PPS 2015 scheme is a Career Average Revalued Earnings (CARE) scheme. Unlike the legacy 1987 scheme, its lump sum rate does not depend on GAD commutation factors.

The regulations governing the 2015 scheme establish a fixed, statutory commutation rate of 12:1. This means that for every £1 of annual pension you choose to surrender, you receive a flat £12 of cash.

Because this ratio is set in the regulations (reg 124(3)), it did not change with the SCAPE review, and the most you can commute stayed at 35.7 percent of the pension (NPCC). The 2015 scheme was not wholly untouched, though: its early payment reduction factors, used when a pension is paid before 60, were revised (issued 7 July 2026, in use from 1 August 2026), and its transfer values changed like all CETVs.

The trade-off: A fixed rate gives certainty, but it is a lower conversion rate than the 1987 GAD factors.

In the 1987 scheme, commutation factors are above 20 at every age up to 61 under the tables in force from 21 May 2026, meaning an officer receives over £20 of cash for every £1 of pension surrendered. Under the 2015 CARE rules, they receive £12.

Transition officers: For transition officers who have service in both the legacy PPS 1987 and the reformed PPS 2015 schemes, their final retirement calculation will use a split approach. The service accrued up to 31 March 2022 (subject to McCloud remedy elections) will commute using the age-related GAD factors under 1987 rules, while any service accrued from 1 April 2022 onward will commute using the fixed 12:1 ratio.

This means only the legacy portion of their lump sum is affected by the GAD factor updates, while the CARE portion remains static.

Why it still matters: Even after the May 2026 reduction, a 1987 factor of, say, 23.22 at 55 gives far more cash per £1 than the 2015 scheme's 12, which is why the 1987 commutation option remains significant for those who have it.

The reaction to the change was understandable. Officers close to retirement had made plans on figures they had been given, and the change took effect immediately, two days after the Treasury announcement.

Common misunderstandings: Some officers assumed their whole pension was being cut by 5 percent, or that the pause in calculations meant pensions were frozen. Neither was true: the NPCC confirmed that pensions built up and in payment are not reduced. The change affected the 1987 lump sum for each £1 of pension given up, transfer values and some other factors.

Before you act: Decisions made in a hurry can cost more than the change itself. Get a written quote from your administrator on the current factors, and talk to your Federation representative or a regulated financial adviser before committing to a retirement date or a lump sum.

The short version: the 1987 factors had already changed on 21 May 2026, so delaying or bringing forward retirement does not restore the old ones. What staying longer can change is the pension itself:

• Increase your final salary linkage (for legacy benefits).
• Add further accrual to your pension.
• Reduce or avoid early retirement reductions (2015 scheme).

Double accrual: Under the legacy 1987 scheme rules, each year after 20 years of service adds 2/60ths of final salary instead of 1/60th, up to a maximum of 40/60ths at 30 years. An officer with 25 years who leaves early misses out on those years.

Whether that is worth more than the effect of a lower factor depends on your own figures, and GAD does not announce future factor reviews in advance. Ask your administrator for quotes at different retirement dates; this page is information, not advice.