Is the teachers pension scheme permissible?

Q: I was automatically enrolled onto the pension in April through my school.

Q1: Is it permissible to continue with the teachers pension scheme?

Secondly, if it is not permissible, what alternatives are there for Muslims who want to take out a pension?

Q2: Do you know of any Sharia Compliant pension schemes?

A: الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب

The Teachers Pension Scheme is a defined benefit pension scheme. The previous position of the Al-Qalam panel was that defined benefit schemes were not permissible on account of the uncertainty they entailed. See: https://alqalam.org.uk/wp-content/uploads/pensions-and-gross-uncertainty-revised-V1aa.pdf However, the position of the Al-Qalam panel has now changed with regards to such pensions. Further to discussions with one of my esteemed teachers, it is now the opinion of the Al-Qalam Panel that defined benefitpensions may be tolerated and deemed permissible as, despite the gross uncertainty they entail, the uncertainty does not lead to inordinate dispute between the pension holder and pension provider.

Thus, the Teacher Pension Scheme as it currently stands is permissible.

And Allah knows best.
Mufti Mohammed Zubair Butt
Chair Al-Qalam Sharia Scholars Panel