Designating bodies

Overview

A designating body is a type of scheduled body that can choose whether it offers LGPS membership to its employees. The most common types are:

• precepting authorities like town and parish council’s
• levying bodies like internal drainage boards
• subsidiaries and other bodies controlled or funded by a scheduled body
• other bodies listed in part 2 of schedule 2 of the LGPS regulations.

Examples of when you might leave the LGPS

There are several reasons why you may be leaving the LGPS, like your:

• last active member of the LGPS is leaving your employment
• organisation is wound up, merged, or ceases to exist
• Local Government or organisation restructures
• you decide to offer a different pension scheme to your employees.

Cessation policy

The circumstances around your exit will determine how we manage your exit, particularly whether:

• you plan to permanently leave the Fund
• you expect to have new active members within 3 years
• another body will take responsibility for some or all your pension liabilities.

You should contact us as soon as you know an exit is possible to discuss the implications and any actions you need to take.

Permanent exit

If you’re permanently leaving the Fund, we’ll ask our actuary to carry out a valuation to work out if there’s a funding deficit or surplus at the date of exit.

Funding deficit

If there’s a funding deficit at exit. The Regulations, require the exiting employer to pay an exit payment to the Fund equal to the value of the deficit, unless other arrangements have been agreed between:

• the admission body
• administering authority
• any body providing a guarantee to the Fund.

If payment is needed, we’d normally ask the admission body to pay the full amount as a lump sum.

If immediate payment of the deficit is unaffordable, the admission body may be allowed to enter into an agreement with the Fund to spread the payments over an extended period or delay a full exit from the Fund. Our cessation policy provides information on the options available and the conditions that must be met for such an agreement to be put in place.

Funding surplus

If there’s a funding surplus at exit, the administering authority is required to decide the value of an exit credit (which may be nil) to be paid to the exiting employer. The decision is made at the discretion of the administering authority considering factors set out in the regulations along with any other relevant factors.

Our cessations policy sets out our approach to making this decision, including the factors that will be considered when doing so.

More information

You can find out more information in the following documents. These are published under Employer policies on the Key documents page for your respective Pension Fund.

• Cessations policy
• Admissions and bulk transfers policy
• Funding strategy statement.