Finance delays for divorcing teachers and NHS staff as pensions recalculated

Divorce of teachers and NHS staff faces delays in financial settlement as Treasury recalculates public sector pensions.

Both current and retired employees will be affected, which lawyers say could have a “serious and drastic” impact on thousands of divorcing couples.

One woman told BBC News she did not expect the change and was unable to move home.

The Treasury announced the delay in March and promised a solution by the summer.

Although only teachers and NHS staff are currently affected, police officers, firefighters and members of the armed forces are expected to be next in line.

Louise Harris, 41, from Kesgrave in Ipswich, says the recalculation of the cash equivalent transfer value – or CETV – of the pension means her children are currently stuck in an unsuitable home.

“It’s having a negative impact on my children and also on my own mental health,” the former teacher told BBC News.

“My family has to live in an unsuitable space. It is unacceptable that this happened unexpectedly.”

When couples separate, they finalize their financial arrangements through a consent form — a legally binding agreement made between spouses based on the value of their current assets.

Both parties must provide information about their possessions, savings and pensions.

If they have a public sector pension, the only way to determine current value is to apply for a Cash Equivalent Transfer Value (CETV).

In March, both the NHS and the Teachers’ Pension Fund temporarily halted all calculations of the CETV while awaiting new ‘factors’ – complex mathematical tables used to calculate the pension value.

Easy Online Divorce’s James Brien said the Treasury changes and the resulting delay caused “a lot of unnecessary stress” for divorcing couples.

“It started with a couple of teachers telling us they couldn’t give their pension numbers because there was an embargo.

“Phones are ringing non-stop as more and more people become aware of this massive problem.

“For most couples, retirement is the greatest asset they have after home, so this delay creates a lot of unnecessary stress and uncertainty.”

“It’s possible to get a divorce without agreeing on finances, but it’s risky, especially with pensions because you lose any right to a widow’s/widower’s pension or benefits once the divorce is finalized.”

There are about 120,000 divorces each year; About 17% of employees work in the public sector.

The UK Treasury announced that on March 30 it announced changes to the way public sector pension CETVs are to be calculated.

“Following the announcement, the calculation of CETVs was temporarily suspended to allow time for the guidance to be updated to reflect the change,” official background information reads.

The document said: “The guidance was published by the UK Treasury on 27 April 2023 and the suspension has ended,” but lawyers say delays are still occurring, leaving thousands of divorcing couples unable to get on with her life.

Are you affected by the problems discussed here? You can contact us by email haveyoursay@bbc.co.uk.

Please provide a contact number if you are willing to speak to a BBC journalist. You can also contact us in the following ways:

If you are reading this page and cannot see the form, you must visit the mobile version of the BBC website to submit your question or comment, or you can email us at HaveYourSay@bbc.co.uk. Please include your name, age and place of residence with each submission.