Can I receive a refund of my contributions?

If you are entitled to a deferred pension then you will not be eligible for a refund of your contributions already paid into the scheme.

The ERPF should have written to you at the time you left the scheme to confirm the benefits you are entitled to.

What happens to my benefits now?

If you are not entitled to claim a refund of your contributions then your benefits will be deferred in the LGPS under the ERPF until your Normal Pension Age unless you choose to retire early or transfer your benefits to another pension provider. 

How can I find out my Normal Pension Age and my State Pension Age?

Your Normal Pension Age in the LGPS is dependent on when you left the LGPS and the benefits that you have earned.

If you left the LGPS before age 65 or your new State Pension Age if this is higher.  You can find you current State Pension Age here (https://www.gov.uk/state-pension-age) but you should be aware that this may change in the future.

As your Normal Pension Age is linked to State Pension Age any changes to State Pension Age in the future will apply to the entire pension you build up in the scheme after 31 March 2014. That means that the age when you can take your pension without suffering any actuarial reduction or actuarial increase to your pension will change.

If you built up membership in the LGPS before April 2014 then you will have membership in the final salary scheme. These benefits have a different Normal Pension Age, which for most is age 65.

Will my deferred benefits increase?

During the time your benefits are deferred in the Fund, they will be increased in line with the Consumer Price Index (CPI) each year from the date you leave.

Can I access my benefits early if I am ill?

If you are unable to work due to illness you may be able to receive immediate payment of your benefits with your previous employers consent.

Your employer must be satisfied that you are permanently unable to do your previous job until your Normal Pension Age and also that you are unlikely to be capable of undertaking other paid employment of at least 30 hours a week for a period of 12 months or more for at least 3 years.

They will refer you to an independent occupational health physician, appointed by them, for an independent opinion on whether or not you meet these criteria

You must contact the ERPF in the first instance if you wish to pursue this option.

When can I take Voluntary retirement?

When you can retire depends on when you left the LGPS. 

If you left after 31 March 2014, you can choose to retire at any time between the ages of 55 and 75 but reductions may apply to your benefits.  More details are provided below.

If you left after 31 March 2006 but before 1 April 2014, you can choose to retire at any time between the ages of 55 and 65 but reductions may apply to your benefits.  More details are provided below.

If you left after 31 March 1998 but before 1 April 2006, you can choose to retire at any time between the ages of 55 and 65 but reductions may apply to your benefits.  More details are provided below.

If you left before 1 April 1998, you MUST retire at age 55 or when you have reached your Critical Retirement Age if later.  The ERPF will write to you when it is time for you to retire.  If you retire before reaching your Critical Retirement Age reductions may apply to your benefits.  More details are provided below.

Will my benefits be reduced?

If you voluntarily retire before your Normal Pension Age then your benefits will normally be reduced to take account of the fact that they are being paid early and therefore your pension will be in payment for longer.  The amount of the reduction will depend upon how early you draw your benefits.

The reduction is calculated in accordance with guidance issued by the Secretary of State from time to time. The reduction is based on the length of time (in years and days) that you retire early – i.e. the period between the date your benefits are paid and your Normal Pension Age.  The earlier you retire, the greater the reduction.

As a guide, the percentage reductions (as at April 2014) for retirements up to 13 years early are shown in the table below. Where the number of years is not exact, the reduction percentages are adjusted accordingly.

 

 Band Pension reduction Lump sum reduction
0 0% 0%
1 5.1% 2.3%
2 9.9% 4.6%
3 14.3% 6.9%
4 18.4% 9.1%
5 22.2% 11.2%
6 25.7% 13.3%
7 29% 15.3%
8 32.1% 17.3%
9 35% 19.2%
10 37.3% 21.1%
11 41.6% N/A
12 44% N/A
13 46.3% N/A

 

 

No reduction is applied to benefits paid for retirement on the grounds of ill health or redundancy.

What is Pensionable pay and how does it affect my pension?

Pensionable Pay

This figure is used to calculate career average pension from 1 April 2014. It is the pay on which you normally pay contributions on your normal salary or wages plus any shift allowance, bonuses, overtime (both contractual and non-contractual), maternity pay, paternity pay, adoption pay, shared parental pay and any other taxable benefit specified in your contract as being pensionable.

You do not pay contributions on any travelling or subsistence allowances, pay in lieu of notice, pay in lieu of loss of holidays, any payment as an inducement not to leave before the payment is made, any award of compensation (other than payment representing arrears of pay) made for the purpose of achieving equal pay, pay relating to loss of future pensionable payments or benefits, any pay paid by your employer if you go on reserve forces service leave nor (apart from some historical cases) the monetary value of a car or pay received in lieu of a car. More information on how your pension is calculated is detailed in the ‘How are my benefits calculated’ question below

Final pay

This figure is used to calculate the final salary benefits accrued to 31 March 2014 (if you have any). It is usually the full time equivalent pay in respect of (i.e. due for) your final year of scheme membership on which you paid contributions, or one of the previous 2 years if this is higher, and includes your normal pay, contractual shift allowance, bonus, contractual overtime (but not non-contractual overtime), maternity pay, paternity pay, adoption pay, shared parental pay and any other taxable benefit specified in your contract as being pensionable.

If you were part-time for all or part of the final year the whole-time pay that you would have received if you had worked whole-time is used and if your pay in your final year was reduced because of sickness or relevant child related leave, final pay is the pay you would have received had you not been on sick leave or relevant child related leave.

More information on how this portion of your benefits is calculated is detailed in the question ‘How are my benefits calculated’ below.

How are my benefits calculated?

Post 1 April 2014 benefits are calculated as follows:

  • main section membership: CARE Pensionable Pay x 1/49
  • 50/50 section membership: CARE Pensionable Pay x 1/98
  • Any pension you buy in each scheme year through an APC (Additional Pension Contribution) contract
  • The amount of pension that any transfer into the scheme purchases is added to your pension account in the scheme year in which the transfer takes place.

Some examples of how CARE is built up in your pension account are available here Calc examples

If you have membership in the scheme before 1 April 2014, your benefits before this date are calculated using your service and final pay before 1 April 2014.

Pre 1 April 2014 benefits are calculated as follows:

  • service up to and including 31 March 2008: Final Pay x Service (in years and days) x 1/80
  • service from 1 April 2008 to 31 March 2014: Final Pay x Service (in years and days) x 1/60
  • the pre 1 April 2008 automatic lump sum: Final Pay x Service (in years and days) x 3/80

If you worked part time your service would have been reduced by the proportion of the full time equivalent hours you worked but your final pay would be calculated on the full time equivalent and would ignore times when you may have been on reduced contractual pay or no pay due to sickness or injury, on ordinary or paid additional maternity/ paternity/ adoption leave, paid shared parental leave, or on reserve forces service leave.

After 1 April 2014, any Assumed Pensionable Pay for these periods of leave will be included within the CARE figure.

For details of how any contracts you have for buying additional pension benefits will be treated please click here Extra conts and retirement table

How do I request an estimate of my benefits?

Before making a decision on whether or not to retire you need to make sure that you know the benefits you will receive. 

All estimates can be requested through your employer but estimates for the following types of retirement:

  • Ill-Health
  • Redundancy
  • Flexible Retirement
  • Interests of business efficiency

MUST be requested through your Employer as they require your Employer’s consent.

You can request an estimate directly from our Retirement team for voluntary retirements between the ages of 55 and 75 by completing an estimate request form and sending it to us.  The form can be downloaded here Member Estimate.  You can also request this type of estimate through your Employer.

What is the Annual Allowance and Lifetime Allowance limit and how will I know if I have exceeded them?

Her Majesty’s Revenue and Customs (HMRC) places restrictions on:

  • the total amount of contributions you can make into all pension arrangements and receive tax relief
  • the increase in your pension savings each year before you become subject to a tax charge, this is called the Annual Allowance
  • the amount of benefits you can receive at retirement before you become subject to a tax charge, this is called the Lifetime Allowance.

This is in addition to any tax due under the PAYE system on your pension once it is in payment.

Although there is no limit on the amount of contributions you can pay into your pension arrangements, tax relief will only be given on contributions up to a total of 100% of your taxable earnings in each tax year.  There are, however, some restrictions on the amounts you can buy or pay into some contracts where you make extra contributions in the LGPS.

Most people will be able to save as much as they wish as their pension savings will be less than the allowances.   

Further info

If you have an Additional Voluntary Contributions (AVCs) contract which started before 1 April 2014, you are limited to paying 50% of your pay each pay period into your AVC.  That limit does not apply if you have an Additional Voluntary Contributions (AVCs) contract which started on or after 1 April 2014.

Will I get an Annual update on my pension benefits?

The ERPF sends out an Annual Benefit Statement (ABS) each year to members who are active members of the scheme around 31st August each year.  The statement shows you the benefits you have accrued to date and gives you an idea of the benefits you could receive at your Normal Pension Age or in the event of your death. 

Unfortunately sometimes not everyone receives an ABS, usually because we are making important changes to your record that means any statement we sent would be incorrect.  If you have not received your ABS this year we will be trying to correct your record before the next ABS statement is due to make sure you receive a statement next year but if you require a statement this year please email ABS@eastriding.gov.uk

How do I let the ERPF know that I want to retire?

Before making a decision on whether or not to retire you need to make sure that you know the benefits you will receive. 

All estimates can be requested through your employer but estimates for the following types of retirement:

  • Ill-Health
  • Redundancy
  • Flexible Retirement
  • Interests of business efficiency

MUST be requested through your Employer as they require your Employer’s consent.

You can request an estimate directly from our Retirement team for voluntary retirements between the ages of 55 and 75 by completing an estimate request form and sending it to us.  The form can be downloaded here Member Estimate.  You can also request this type of estimate through your Employer.

Once you have received an estimate, if you want to go ahead with your retirement then you need to let your Employer know that you want to retire and they will talk you through the procedure and send us the paperwork we need to complete your retirement.

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