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Public Service Pensions: SCAPE Discount Rate · Order Paper · Order Paper

HANSARDCommons19 May 20261 contribution

Public Service Pensions: SCAPE Discount Rate

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The Parliamentary Secretary to the Treasury (Torsten Bell)
LabourSwansea West
SCAPE—superannuation contributions adjusted for past experience—is the process for setting employer contribution rates at valuations of unfunded public service pension schemes. As part of the SCAPE process, the SCAPE discount rate is used alongside many other factors such as earnings changes, changes to life expectancy and demographic assumptions to determine the appropriate employer contribution rate. Valuations as at 31 March 2024 are currently under way and will result in new employer contribution rates, which will be implemented from April 2027.
The current methodology for setting the discount rate, based on the Office for Budget Responsibility’s forecast of long-term GDP growth, was adopted in 2011, with a commitment to review its methodology every 10 years. A review under the previous Government, from 2021 to 2023, maintained this methodology.
The SCAPE discount rate to be used as part of the ongoing 2024 valuations will therefore be based on the expected long-term GDP growth figures, published by the OBR in July 2025. Based on these figures, the new SCAPE discount rate is CPI+2% p.a.
[HCWS37]