The Rule Of 85 Pension: 5 Crucial Facts You Must Know About This Retirement Protection (Especially After McCloud)
The 85-year pension rule is one of the most significant and often misunderstood protections available to long-serving public sector employees in the UK. This rule is not a simple right to retire, but rather a complex safeguard that prevents some or all of your hard-earned pension benefits from being reduced if you choose to take them before your Normal Pension Age (NPA).
As of December 2025, understanding the 85-year rule is more important than ever, especially in light of the ongoing implementation of the McCloud Remedy. This landmark ruling has restored or is set to restore this protection for thousands of members who were unfairly moved to new pension schemes. Here is a deep dive into the five crucial facts you need to know about the 85-year rule.
1. The Simple Calculation: Age + Service = 85
The core of the rule is a straightforward calculation that determines your eligibility for protection against actuarial reduction—the standard reduction applied to pension benefits taken early. If you meet the rule, your benefits are paid out in full, or with a significantly lower reduction, depending on when they were built up.
How the 85-Year Rule is Calculated
- Your Age: Your age in whole years at the point you wish to retire.
- Years of Service: Your total years of pensionable service (scheme membership) in whole years.
- The Threshold: If your age plus your years of service equals 85 or more, you satisfy the rule.
For example, a member aged 57 with 28 years of pensionable service satisfies the rule (57 + 28 = 85). If their Normal Pension Age is 68, they could potentially retire 11 years early without having a reduction applied to their protected benefits.
It is critical to remember that the 85-year rule is not an early retirement rule; it is a protection rule. You must still be eligible to take your pension benefits (i.e., you must have met the minimum vesting period and be over the minimum retirement age, typically age 55, although this is rising to 57 from 2028).
2. Who It Applies To: The Local Government Pension Scheme (LGPS)
The 85-year rule is overwhelmingly associated with the Local Government Pension Scheme (LGPS), which covers a vast number of public sector workers, including local council staff, school support staff, and employees of various public bodies. While other public sector schemes (like the NHS or Teachers’ Pension Scheme) have their own variations of early retirement protections, the specific 'Rule of 85' mechanism is a defining feature of the LGPS.
The Crucial Protection Dates
The rule was originally phased out due to changes in the LGPS, meaning the protection only applies to benefits built up during a specific period. This is where the rule becomes complex:
- Full Protection: You are fully protected if you joined the LGPS before 1 October 2006 and meet the 85-year rule when you retire. This means your benefits built up to 31 March 2008 will be paid without reduction.
- Tapering Protection: For those who joined between 1 October 2006 and 31 March 2014, the protection may be 'tapered' or reduced, and only applies to service built up to 31 March 2014.
- No Automatic Protection: Benefits built up after 1 April 2014 are generally not protected by the 85-year rule and will be subject to a standard actuarial reduction if taken early.
This distinction between pre-2008 and post-2014 benefits is vital for calculating a member's final pension pot, which often comprises multiple sections with different rules.
3. The Latest Update: The McCloud Remedy and the Deferred Choice Underpin (DCU)
The most significant and current development affecting the 85-year rule is the McCloud Judgment (formally the *McCloud and Sargeant* cases). This ruling found that the transitional protections offered to older members when new pension schemes were introduced in 2014 and 2015 constituted age discrimination against younger members.
What the McCloud Remedy Does
The government is implementing the McCloud Remedy (legislated through the Public Service Pensions & Judicial Offices Act 2022) to correct this discrimination. For those affected, the key takeaway is that the 'remedy period' (1 April 2014 to 31 March 2022) will be treated differently.
The remedy uses a mechanism called the Deferred Choice Underpin (DCU). This means that when an affected member retires, they will be given a choice on how their benefits for the remedy period are calculated: either under the old, protected scheme rules (which may include the 85-year rule protection) or the new scheme rules (which are typically Career Average Revalued Earnings or CARE).
Implementation Timeline
While the legislation is in place, the process of providing members with their options and rectifying past pensions is complex. Initial plans targeted full rectification for active and deferred members by August 2025, but this timeline is subject to ongoing developments and scheme-specific changes. Members are being advised to wait for their scheme administrator to contact them with their specific options.
4. The Impact of Flexible Retirement
The 85-year rule can interact with flexible retirement, a feature offered by many LGPS employers that allows members to draw some or all of their pension benefits while continuing to work, often in a reduced capacity or role.
If you opt for flexible retirement and satisfy the 85-year rule, your protected benefits may still be paid without reduction. However, a crucial caveat exists: the 85-year rule will not protect any benefits you build up *after* you first take flexible retirement. These new benefits will be subject to the standard actuarial reduction if taken before your Normal Pension Age.
It is essential to consult with your pension administrator before making a flexible retirement decision, as the rules are often subject to employer discretion, including the ability for an employer to waive early retirement reductions.
5. Why You Must Check Your Annual Benefit Statement
Given the complexity of different protection dates, the phasing out of the rule, and the upcoming McCloud Remedy calculations, your Annual Benefit Statement (ABS) is your most important document. It provides a personalised projection of your pension benefits, detailing which portions are protected and which are subject to actuarial reduction.
If you believe you were affected by the 2014/2015 scheme changes and are approaching retirement, you should specifically look for information regarding the Deferred Choice Underpin or the McCloud Remedy in your scheme's communications. Do not assume your pension administrator has all the correct information until you have received your final options.
Ultimately, the 85-year rule is a testament to the value placed on long-term public service. While its application is intricate, understanding the basic calculation and the recent legal protections ensures you can plan your retirement with confidence and secure the full benefits you are entitled to.
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