Committee publication · Estimate memoranda · 19 May 2026
Judicial Pensions Scheme Main Estimates Memorandum 2026-27
From: Justice Committee
Summary
This estimate memorandum sets out the Ministry of Justice's Judicial Pensions Scheme (JPS) budget for 2026-27, seeking £246.1 million in Resource Annually Managed Expenditure. The JPS covers multiple judicial pension schemes (2022, 2015, 1993, 1981, and fee-paid schemes) with 26,119 total members. The main budget movement reflects a Treasury-set discount rate increase offsetting lower actuarial costs and higher contribution income.
Key findings
- Resource AME sought of £246.1 million for 2026-27, a decrease of £6.8 million (2.7%) from the previous year's supplementary estimate.
- Interest costs on scheme liabilities increased by £18.6 million due to nominal discount rate rising from 5.15% to 5.60%, the primary driver of spending changes.
- Actuarial cost of accruing pensions decreased from 42.8% to 39.1% of pensionable payroll, reducing current service costs by £7.2 million.
- McCloud remedy options exercise for judges commenced October 2023; estimate includes £5 million for additional pension due and compensation for financial and tax losses.
- Total scheme liabilities as at 31 March 2025 were £4.77 billion; JPS administration outsourced to XPS Administration Limited until 30 September 2026, transferring to Spence and Partners Ltd from 1 October 2026.
Tone
ProceduralTopics
Key actors
Ministry of Justice, Government Actuary's Department (GAD), Dr Jo Farrar CB CBE (Accounting Officer), Lord Chancellor (JPS Scheme Manager), XPS Administration Limited (pension administrator until 30 September 2026), Spence and Partners Ltd (incoming pension administrator from 1 October 2026), Punter Southall Limited (former administrator)
Notable line
“Resource AME sought under the Ministry of Justice: Judicial Pensions Scheme Estimate is essentially the amount by which liabilities under the pension scheme are estimated to increase during the year, less the contributions paid by employers and employees towards those liabilities.”
Key Quotes
“The pension has an annual accrual rate of 2.5% (or 2.42% for three years for members who opted to pay reduced contributions until 31 March 2025).”
“An options exercise for judges in scope of the McCloud remedy commenced in October 2023. This allows them to make a retrospective choice of pension scheme membership for the period from 1 April 2015 to 31 March”
“An increase of £18.6m in interest is due to the increase in the nominal discount rate from 5.15% p.a. on 31 March 2025 to 5.60% p.a. at 31 March”
“With effect from 1 October 2026 judicial pension administration will be managed by Spence and Partners Ltd.”
Source · parliament.uk record ↗