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2015 Pension Scheme FAQs

Updated: June 2014

(Printable Version)

Q1.   When will the new arrangements be implemented?

A. These changes will come into effect from 1st April 2015. Up until then members will continue in the 1995/2008  Superannuation Scheme.

Up until then members will continue in their current pension scheme.

Q2.  What will the 2015 scheme look like?

A. The Framework Document can be viewed on the SPPA Website.

The main features of the new scheme are:

    • defined benefit - career average scheme
    • Member's normal pension age (npa) will be the same as their state pension age. State Pension Calculator
    • accrual rate of 1/54th of pensionable earnings each year
    • no limit to pensionable service
    • benefits earned whilst in service will be increased annually in line with inflation, (currently the consumer price index - CPI) plus 1.5% per annum
    • when a member retires or leaves the scheme, benefits will be revalued in line with inflation (currently CPI)
    • member contributions to be paid on a tiered basis to produce a total yield of 9.8% of total pensionable pay in the Scheme.
    • no automatic lump sum but members will be able to opt to give up some of their pension for a tax free lump sum at the rate of £12 of tax free cash for every £1 per annum of pension given up (subject to a maximum limit)
    • retirement flexibilities include partial retirement, early/late retirement factors and ability to retire and return to the pension scheme
    • spouse and partner pensions based on 1/160th member's full pension (i.e. before any commutation)
    • abatement as current arrangements
    • lump sum on death payable at 2 x actual pensionable pay
    • option to buy out years to member's NPA over age 65
    • facility to buy additional pension
    • those who transfer from the 1995 section with added years contracts will be able to maintain these
    • Public Sector Transfer Club will continue
    • ill health benefits to be based on current arrangements but upper tier benefits enhancements will be at the rate of 50% of prospective service to NPA.

Q3. Will everyone be moving to the new scheme on 1 April 2015?

A. No. If you were an active member of either section of the 1995/2008 Scheme on 1 April 2012 and on that date you were within 13 years and 5 months of your existing normal pension age you are subject to Protection arrangements. ALL other members will automatically move to the new arrangement from 1 April 2015 for future service only. Click here for more information about the Protection arrangements.

Q4.  For members who are not covered by protection, what happens to the pension they will have earned up to 2015?  Will members have to wait until their state pension age to access it?

A. No. The pension members have earned up until 2015 is protected and they can access it in full at their current normal pension age. This protected pension will be linked to their final salary at the time they leave or retire. If members have a pension age of 55 or 60, they will be required, as now, to retire and leave the pension scheme when they take their benefits. This means that members will either have to take any additional 2015 benefits with a reduction as they are taken early, or defer taking these protected benefits until a later date.

Q5.  What is a Career Average Pension? How does it compare with a Final Salary pension?

A. In a Career Average scheme, everyone earns the same proportion of their total salary in pension. In the proposed NHS career average pension scheme, members will earn 1/54th of their pensionable pay each year in pension. This is then revalued each year and added to the following years pots to get the total pension.

Q6.   What happens to a member's normal pension  age in the 2015 scheme if their state pension age increases?

A. If a member's state pension age rises, then the age at which they can take their 2015 scheme benefits also rises. Members will be able to take their benefits at any age after 55, but there will be an actuarial reduction if it is before their state pension age.

Q7. How do these changes relate to the Pensions Choice Exercise I have already been through?

A. Following the introduction of pension reforms in 2008 members of the 1995 section  were given the choice  to transfer to the 2008 section. Those members who decided not to transfer to the 2008 section and are not entitled to full Protection will be given another opportunity to consider this again under a follow up exercise known as 95 Section Choice Exercise (Choice 2).

Members will wish to note that this exercise is being run later in Scotland than in England and Wales.  In England and Wales, it will start in the
Autumn of 2014.  However, in Scotland, the equivalent exercise will take place after the introduction of the new Scheme on 1st April 2015. Further information on the second choice exercise

Q8. When will further information on the 2015 scheme be made available?

A. Further information about the detail of the new arrangements will be published on the SPPA website as it becomes available.

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