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  • FIRST POST
    • jan9912
    • By jan9912 30th Nov 17, 2:52 PM
    • 14Posts
    • 1Thanks
    jan9912
    Redundacy /Pension
    • #1
    • 30th Nov 17, 2:52 PM
    Redundacy /Pension 30th Nov 17 at 2:52 PM
    Hi Guys

    I wonder if any one has any ideas re the above. Basically i have just heard that work may offer voulantry Redundancy, i am 55 in july would i be right in thinking that my pension would be made up to a full pension if i took V R as well. i have 30 yrs service at work and my pension is local government.

    thanks
    j
Page 1
    • Silvertabby
    • By Silvertabby 30th Nov 17, 3:07 PM
    • 1,932 Posts
    • 2,441 Thanks
    Silvertabby
    • #2
    • 30th Nov 17, 3:07 PM
    • #2
    • 30th Nov 17, 3:07 PM
    No - this is a common misconception.

    Under LGPS redundancy terms (voluntary or compulsary) your pension accrued up to your date of leaving would be paid without any actuarial reduction for early payment, but it wouldn't be enhanced to your NRA.

    Even this would only apply if you are 55+ when you are made redundant. Be careful if your department is offering voluntary redundancy now, as they may be looking at the financial year end - ie, March next year.

    If you were to take redundancy before you are 55, then your pension would be preserved in the scheme until you are 55 - and would be subject to the whole raft of early retirement reductions if taken then.
    Last edited by Silvertabby; 30-11-2017 at 3:21 PM.
    • Peelerfart
    • By Peelerfart 30th Nov 17, 7:53 PM
    • 1,837 Posts
    • 1,618 Thanks
    Peelerfart
    • #3
    • 30th Nov 17, 7:53 PM
    • #3
    • 30th Nov 17, 7:53 PM
    I'm no lgps expert, I was private sector, but IMHO you sit tight until you are 55, then see what options you have. Hopefully things will work in your favour then.
    Space available for rent
    • Teaandscones
    • By Teaandscones 30th Nov 17, 8:21 PM
    • 121 Posts
    • 102 Thanks
    Teaandscones
    • #4
    • 30th Nov 17, 8:21 PM
    • #4
    • 30th Nov 17, 8:21 PM
    Hi Guys

    I wonder if any one has any ideas re the above. Basically i have just heard that work may offer voulantry Redundancy, i am 55 in july would i be right in thinking that my pension would be made up to a full pension if i took V R as well. i have 30 yrs service at work and my pension is local government.

    thanks
    j
    Originally posted by jan9912
    The redundancy terms in LG for a 54 year old are generally rubbish and you get no pension payable.

    However if you are 55 the terms are extremely generous as they will pay your pension already accrued (ie the 30 years worth already earned not another 10 years on top) without actuarial reduction.

    You need to hold out until July.
    • jan9912
    • By jan9912 12th Dec 17, 12:57 PM
    • 14 Posts
    • 1 Thanks
    jan9912
    • #5
    • 12th Dec 17, 12:57 PM
    • #5
    • 12th Dec 17, 12:57 PM
    Aww thanks guys like you said the VR will probably be done by April so ill miss out. Thanks for your advice.

    j x
    • bioboybill
    • By bioboybill 13th Dec 17, 2:21 PM
    • 2,919 Posts
    • 1,302 Thanks
    bioboybill
    • #6
    • 13th Dec 17, 2:21 PM
    • #6
    • 13th Dec 17, 2:21 PM
    I have been in the LGPS for 32 years and my wife was in it 18 years. In July of this year our employer offered a VS scheme. I checked our pension rules and it said that if you are 55 and are offered severance on the basis of efficiency savings you are entitled to an unreduced pension for service up to that point, even if it's voluntary. My wife is 56, so she thought "great!". However, our employer was very sneaky. They asked you to declare whether you wished to take an unreduced pension or would accept a reduced pension. Everybody who asked for an unreduced pension was told they were essential to the business and refused severance. Only those that accepted a reduced pension were allowed to go. My wife took the severance and has defered her pension until we decide we need the money. In other words don't just assume your pension will be unreduced, as employers can be very sneaky in getting round the rules.
    • tempus_fugit
    • By tempus_fugit 13th Dec 17, 2:26 PM
    • 328 Posts
    • 310 Thanks
    tempus_fugit
    • #7
    • 13th Dec 17, 2:26 PM
    • #7
    • 13th Dec 17, 2:26 PM
    My OH was 56 last year when she accepted a VS offer with a retirement option or a severance option. She had been in the LGPS for 18 years at that point. Anyone over 55 could take the retirement option, which had a lower severance payment with full pension payable from date of leaving. BUT there was a maximum cost to the employer of one year's salary. As full payment of pension would have breached this limit, the pension option was not available to her and she had to take the higher severance offer but wait until she is 62 to get an unreduced pension. The solicitor did say that she *might* have a case for being dealt with unfairly but the possibility of losing any case, and the severance offer along with it, made this an unpalatable option for us.
    Last edited by tempus_fugit; 13-12-2017 at 2:29 PM.
    Retired at age 56 after having "light bulb moment" due to reading MSE and its forums. Have been converted to the "budget to zero" concept and use YNAB for all monthly budgeting and long term goals.
    • Crabby
    • By Crabby 13th Dec 17, 3:05 PM
    • 735 Posts
    • 177 Thanks
    Crabby
    • #8
    • 13th Dec 17, 3:05 PM
    • #8
    • 13th Dec 17, 3:05 PM
    They asked you to declare whether you wished to take an unreduced pension or would accept a reduced pension. Everybody who asked for an unreduced pension was told they were essential to the business and refused severance.
    No, they where told they where critical to the business.
    Winner winner, Chicken dinner.
    • xylophone
    • By xylophone 13th Dec 17, 4:05 PM
    • 23,653 Posts
    • 13,782 Thanks
    xylophone
    • #9
    • 13th Dec 17, 4:05 PM
    • #9
    • 13th Dec 17, 4:05 PM
    critical to the business.
    And now critical of the business?
    • AlanP
    • By AlanP 13th Dec 17, 4:25 PM
    • 998 Posts
    • 708 Thanks
    AlanP
    Not untypical, and not totally unreasobale to be honest.

    Typical example - Efficiciency Savings need a Business Case that has to show a saving over 3 years including the Pension Strain Cost that the employer will have to stump up to cover pensions paid out early.

    If it doesn't save the authority, and the taxpayer money, why should they let the VS request go through?
    • Teaandscones
    • By Teaandscones 13th Dec 17, 10:56 PM
    • 121 Posts
    • 102 Thanks
    Teaandscones
    Anyone over 55 could take the retirement option, which had a lower severance payment with full pension payable from date of leaving. BUT there was a maximum cost to the employer of one year's salary. As full payment of pension would have breached this limit, the pension option was not available to her and she had to take the higher severance offer but wait until she is 62 to get an unreduced pension. The solicitor did say that she *might* have a case for being dealt with unfairly but the possibility of losing any case, and the severance offer along with it, made this an unpalatable option for us.
    Originally posted by tempus_fugit
    It is perfectly reasonable for a LG employer to put a financial limit to accepting VR requests. The one year's salary limit to costs including pension strain cost looks fairly typical so that for long serving staff it is very unlikely for anyone 55 to 57 /58 being accepted for VR.

    BUT I think your OH's HR department is skating on very thin ice by agreeing to pay enhanced severance pay. That sounds like de facto redundancy and as such you could claim that you should have unreduced pension as of right under the rules of the scheme whatever HR has said.
    https://www.lgpsregs.org/resources/guidesetc.php

    I would think about writing to your pension administrator to claim that position and then going to IDRP if you are within the time limits. That would put the cat amongst the pigeons.
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