How are public pensions divided in divorce?
While pensions are included with other assets and liabilities when dividing finances during divorce, separation or civil partnership dissolution, the way the law deals with public sector pensions makes things slightly more complicated.
In this blog, our divorce finance solicitors look at how public sector pensions are divided and why it’s so important to seek legal advice when splitting finances with your ex-partner.
This blog was originally published in July 2025 and updated in September 2026 to include HM Treasury’s change to the SCAPE rate.
What is a public sector pension?
Teachers, civil servants, NHS workers, the armed forces, Police, and fire service workers are all entitled to a public sector pension. This is different from the type of pension offered to those in the private sector, such as those working in financial services, professional services, retail and hospitality, etc.
Most public sector pensions are unfunded, meaning they are paid for by the taxpayer.
Public sector pensions often contain valuable benefits that require specialist advice when considering them as part of a financial settlement.
Some public sector workers have a defined benefit pension scheme, which pays an income on retirement based on their most recent salary and the number of years worked.
How are public sector pensions divided in divorce or separation?
During the divorce process, any public sector pension should be disclosed (alongside other finances, assets and liabilities) within the Form E financial statement. As part of this, the Cash Equivalent Transfer Value (CETV or CEV) of the pensions will be established, which is important when dividing finances as part of the divorce or separation. A CETV is the estimated cash value the pension would have if it were to be transferred out of a pension scheme.
Once your solicitor has the pension’s CETV, they will be able to advise you on how to split it. Public sector pensions are usually split by a Pension Sharing Order or Earmarking Order.
Types of pension sharing orders:
- A Pension Sharing Order allows the ex-partner or ex-spouse to receive a share of the pension’s benefits. This is the most common arrangement for dividing pensions.
- Earmarking Orders, also known as Pension Attachment Orders, allow the holder to keep the pension but arrange for the ex to receive payouts, either as one lump sum or via regular payments.
- Pension offsetting: this is where a party may retain their pension, and the other party with the lower or no pension receives a larger share of another marital asset.
Sharing a public sector pension in divorce is complex, so it’s important to seek legal advice from a solicitor who specialises in divorce finance.
An increase in value for public sector pensions
In May 2026, HM Treasury announced a change to the discount rate used to calculate public sector pension values, known as the SCAPE rate. This led to updated CETV factors being issued across 21 public service pension schemes, including those for teachers, the NHS, the armed forces, and local Government. Changes were rolled out through the summer of 2026.
As with the 2023 review, these updates have increased the calculated value of public sector pensions. This means valuations obtained before these changes may no longer reflect the pension’s current worth, which can be a problem if you’re relying on an older CETV to negotiate a financial settlement.
What does this mean for divorcing couples?
If you or your ex-partner hold a public sector pension, it’s worth checking when your CETV was last calculated. An outdated valuation could mean you’re negotiating based on a figure that no longer reflects the pension’s true value.
What is the McCloud remedy and how does it affect divorce?
If you or your ex-partner had public sector service between 2015 and 2022, your pension may be affected by the McCloud remedy. This followed a legal ruling that certain pension reforms introduced in 2015 discriminated against older scheme members, and it means many public sector workers have had part of their pension rights recalculated.
For couples going through divorce, this matters because it can change the CETV used in your financial settlement. Several schemes are still being reviewed and reissued. If your pension falls within the affected period, your solicitor can advise on whether the CETV reflects the McCloud recalculation before it’s used in your settlement.
This is another reason why specialist legal advice is so valuable when public sector pensions are involved.
Unfortunately, both of the above can cause long delays in public sector pension providers sending out information to their members. These delays can be mitigated by requesting the correct information at the earliest possible stage.
What happens when I retire?
After the Pension Sharing Order has been implemented, you will become a pension credit member of the same pension scheme as your ex-husband or wife. The pension provider will send you periodic statements and, on retirement, you will receive any lump sum and income which you are entitled to under the rules of the scheme.
The age at which the pension comes into payment (including any lump sum payments you may be entitled to) will depend on the specific rules of your ex-spouse’s pension scheme, but these will be known in advance.
What happens if I retire early?
If you retire early and take your public service pension, but it is subject to a Pension Sharing Order, the amount shared with your ex will be determined by the point at which you start receiving the payments.
Don’t forget your death in service benefit
One thing that separating couples often forget about is ‘death in service’, a benefit offered by many employers.
With a death-in-service benefit, if an employee passes away during their employment, the employer makes a payout to a nominated person, i.e. their spouse. It is important to cancel this nomination when you are divorcing or separating.
If you die before a Pension Sharing Order has taken effect, your former partner or spouse will not be entitled to anything. It is therefore important to either nominate a new person or re-nominate your ex-partner to ensure the benefit goes to the right person.
If you have children with your ex, you may wish to re-nominate them so that your children can benefit from the payout.
Advice on pension sharing in divorce
If you are separating from your partner and are worried about how your public sector pension might be divided, it is important to get legal advice from a divorce finance solicitor.
Get in touch with our divorce and separation lawyers on 0117 325 2929 or fill out our online enquiry form, and we will contact you.
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- Gareth Hughes
- Senior Associate
