Issue details

The contract for the provision of the shared cost AVC scheme for employees in the Local Government Pension Scheme to further save towards their retirement will expire on 2 May 2026. The Authority is looking to re-procure a contract for the continued provision of this scheme.

There are currently 518 employees with salary sacrifice agreements in place for this scheme. The continued offer will ensure current and future employees retain the option of saving towards their retirement on top of their LGPS, while making savings on their tax and National Insurance contributions. The council also achieves savings via employer national insurance savings arising from those participating in the scheme and the reduction on their gross pay.

The decision to be taken relates to procurement of the scheme which has a significant published contract value, with the council paying costs to administer the scheme as a percentage of the value of the salary sacrificed sums. Based on current council costs and trends in increasing employee participation, this will potentially reach and go beyond £500k over the course of the contract of 4 years. Additionally, savings arising from participation in the scheme were £262.5k in 24/25 and are projected to be £340k in 25/26 and follow a similar trend in future years.

This is an in/out spend resulting in the council saving on the participation rather than spending from existing budgets.