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Help Please To Understand Pension
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sandram
Posts: 11 Forumite
Hello,
I am wondering if anyone can please help me understand my pension details.
I took out a pension in 1986 in 1996 I left the company and deferred the pension. I received a letter telling me of all the increases due until my retirement date in 2008 which amounted to £3084. However in January 2005 the company went into administration. In October 2011 my pension was taken over by the Payment Protection Fund.
My lack of understanding comes from not knowing what happened to any increases before the company went into administration and the 6 years before joining the PPF. On leaving my company my pension was £1962.10 and it is now £2382 an increase of just £420.
Hoping someone can please explain this to me.
Many thanks.
I am wondering if anyone can please help me understand my pension details.
I took out a pension in 1986 in 1996 I left the company and deferred the pension. I received a letter telling me of all the increases due until my retirement date in 2008 which amounted to £3084. However in January 2005 the company went into administration. In October 2011 my pension was taken over by the Payment Protection Fund.
My lack of understanding comes from not knowing what happened to any increases before the company went into administration and the 6 years before joining the PPF. On leaving my company my pension was £1962.10 and it is now £2382 an increase of just £420.
Hoping someone can please explain this to me.
Many thanks.
0
Comments
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Sorry, it is per annum0
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You reached the NRD for your Scheme in 2008 but received no pension payments because the Scheme was in administration?
You started to receive payments in 2011? http://www.pensionprotectionfund.org.uk/Pages/compensation.aspx
"If You Retired Early
If you retired early and had not reached your scheme’s normal pension age when your employer went bust, then you will generally receive 90 per cent level of compensation based on what your pension was worth at the time. The annual compensation you will receive is capped at a certain level.
The cap at age 65 is, from 1 April 2013, £34,867.04 (this equates to £31,380.34 when the 90 per cent level is applied) per year. The earlier you retired, the lower the annual cap is set, to compensate for the longer time you will be receiving payments.
You can view a full list of the compensation caps for each age here.
Once compensation is being paid, then payments relating to pensionable service from 5 April 1997 will rise in line with inflation each year, subject to a maximum of 2.5 per cent. Payments relating to service before that date will not increase."
Does the above explain what has happened with your pension?0 -
I started to receive my pension payment of £2382 per annum in Feb. 2008 at age 60 as per my pension terms.
I originally deferred my pension with the pension people that my company used. When the company went into administration in 2005 the pension was transferred to another company who eventually paid my pension (2008) it was then transferred again in 2011 to the PPF who continue to pay my pension.
However, I don't know why my pension has only increased by £420 over all those years especially as from 1997 -2005 the company was still solvent. It was originally supposed to increase from date of leaving 1996 to retirement date 2008 by
"excess of GMP 5% or RPI if less and the part that corresponds to GMP will increase by a fixed rate currently 7% per annum". Giving a total increase of £3084 bringing a total pension of £5046.
I do not get annual increases as I left the fund in August 1996.0 -
Are you male?
When you left the company what were the figures at leaving for pre 88 GMP, post 88 GMP and excess?
Are you receiving your state pension? If so what is shown on your statement for pre 97 COD?
Have you looked at the PPF link above under "If you have retired"?0 -
Info is still a bit sketchy...
But it sounds like you were below the scheme's NRA of 60 when the scheme entered the Assessment Period in 2005 (?)
As a result the compensation could be the 90% figure mentioned by xylophone (?).
You say your deferred pension at leaving in August 1996 was £1,962.10 pa. What was the split of this between the GMP at leaving and the excess over GMP? We need this to start playing with the numbers.
(edit: cross posted with xylophone)I came, I saw, I melted0 -
I am female and in receipt of state pension.
Sorry if I am sounding vague but I am looking at paperwork and getting info from that. I do not understand all the abbreviated terms.
When I left the company the value of my pension at date of termination was £1962.10 per year inc. any contracted out GMP. It then states the pension will increase until normal retirement date by the amounts I listed above. then continues "Taking the increases into account it is estimated your pension will increase by £3084.74 to a total of £5046.84 per annum. However it has only increased by £420 per annum even though the company was still solvent for several years after I left. The transfer value was £12545.46 if that helps.0 -
That should read "only increased by £420" overall not per annum0
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I am female and in receipt of state pension.
Sorry if I am sounding vague but I am looking at paperwork and getting info from that. I do not understand all the abbreviated terms.
When I left the company the value of my pension at date of termination was £1962.10 per year inc. any contracted out GMP. It then states the pension will increase until normal retirement date by the amounts I listed above. then continues "Taking the increases into account it is estimated your pension will increase by £3084.74 to a total of £5046.84 per annum. However it has only increased by £420 per annum even though the company was still solvent for several years after I left. The transfer value was £12545.46 if that helps.
It's the GMP element of your pension either at leaving or on reaching age 60 (ideally split between pre 88 GMP and post 88 GMP) that we need to know. If you have a deferred benefit statement it should show on the statement either 'GMP at leaving' or 'initial GMP' or 'revalued GMP' somewhere. GMP stands for Guaranteed Minimum Pension.
Because the GMP and excess over GMP increase at different rates the split is needed to make progress here.
The split is also needed to work out where your original £3,084 increase figure (before scaling back under the PPF) might have come from, that figure looks implausibly high, as a mix of 7% and 5% or RPI increases wouldn't result in an increase of that order at age 60 (i.e. a 157% increase is too high based on about 10 or 11 years increases).I came, I saw, I melted0 -
There is nothing like that on the original paperwork on leaving the scheme in 1996. This is where the figures I have previously given have come from.
In 2007 I was sent a statement of benefits which state; pension earned at date of leaving £1962.10. including an amount in respect of GMP of £694.20 a year. Of this amount your GMP accrued after 1988 is £574.08 a year.
It then states these are likely to be reduced to PPF levels as it was in a PPF assessment period.
Thank you for your patience, I hope this helps.0
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