15 May 2026
The Government has introduced changes to the Local Government Pension Schemes (LGPS) in England and Wales from 1 April 2026, aimed at making the scheme fairer and more accessible. Central to these changes is the introduction of Qualifying Additional Pension Arrangements (QAPAs), which replace the previous system used to restore ‘lost’ pensions.
The LGPS is one of the largest public sector pension schemes and is administered by 86 local authorities across England and Wales, with around 6.9 million members. It is a defined benefit pension scheme, meaning pension benefits are based on the employee's salary and how long they pay into the scheme.
Under the new 1 April rules, short periods of authorised unpaid absences, lasting up to 14 days, will now be treated as fully pensionable, using ‘lost pensionable pay’. This means both employers and employees must continue contributions as if the member were working, with no break in pension build-up. Lost pensionable pay is added to any actual pensionable pay in the period. For example, if the member receives a bonus or backdated pay, then the actual pensionable pay and lost pensionable pay should be added together to find the total pensionable pay for the period.
The reforms also address the research results from the gender pensions gap, where the LGPS had found that women typically receive lower pensions than men. This is due to being more likely to take family-related leave. Unpaid additional maternity, adoption and shared parental leave are now covered by assumed pensionable pay (APP), building pension during these periods without needing to purchase the lost pension amounts. This is usually based on the employee's average pensionable pay before the absence, often over a recent period.
For longer periods of unpaid absence exceeding 14 days, not due to illness or child-related leave, the new QAPA framework provides a more flexible approach for members to buy back pension contributions that would be otherwise lost. Unlike the previous Additional Pension Contributions (APC) arrangements, which required members to confirm if they wanted to buy some or all of the pension contributions lost within 30 days, QAPAs offer a significantly extended election window of up to 12 months of returning to work, provided the individual remains in the same employment. The employer may also allow a longer period for the member to make an election.
Under a QAPA, the amounts are based on the normal contribution rates, ignoring the unpaid leave and are also not subject to reductions where a member retires early due to redundancy or efficiency. The contributions can be paid by lump sum or regular deductions through the payroll, whilst the employer deductions are based on what would have been paid if the member was not absent.
For employers and pay professionals, the changes introduce new operational considerations. Systems and processes will need to ensure that pension contributions continue during short absences of up to 14 days and that members are made aware of their options under the new QAPA rules for longer absences. Clear communication will be essential to support understanding and compliance, particularly where members decide to use QAPA. The Local Government Association (LGA) has published a QAPA calculator to help employers work out the cost of buying back the ‘lost’ pension contributions.
Information provided in this news article may be subject to change. Please make note of the date of publication to ensure that you are viewing up to date information.