NHS pension anxieties...any thoughts?

Dr_Wu

Hi there

I'm in the fortunate position of having 25 years service with the NHS and having Mental Health Officer status which basically means I now have 30 years pensionable service and can retire on full pension at 55 in 8 years time. So far so good.

I've been increasingly aware through the media that moves are afoot to cut the amont spent on public sector pensions and that depending on which paper you read "pensions are to be slashed" etc.

Now I'm a realist, I accept that the cost of these final salary pensions is high and probably unsustainable in the current economic climate and that changes will have to be made. I personally don't object to making increased contributions.

Does anyone have any thoughts on what at the end of the day the changes which will affect me are likely to be given that by the time any legislation is passed I'll have been in the scheme for 26 years and likely only be 7 years from retirement?

I know it's guesswork but I'd be interested in people's opinions especially if there's anyone out there in a similar situation.

Steve

Paul2009

Sorry to sound harsh put I hope a future gov DOES stop you from taking your full pension at 55 and are made to work till 65 to get the full pension. There is no way on earth you will have paid in enough in 25 years to cover the cost of paying a full
indexed linked pension from age 55.

After saying that I don't think they will have guts to make the cuts needed ( unless we end up with IMF at the door ) so I bet you will be ok.

Oldernotwiser

Paul2009 wrote: »

There is no way on earth you will have paid in enough in 25 years to cover the cost of paying a full
indexed linked pension from age 55.

The OP already has 30 years' pensionable service and plans to work for another 8 years; I make that 38 years rather than 25!

Dr_Wu

Paul2009 wrote: »

Sorry to sound harsh put I hope a future gov DOES stop you from taking your full pension at 55 and are made to work till 65 to get the full pension. There is no way on earth you will have paid in enough in 25 years to cover the cost of paying a full
indexed linked pension from age 55.

After saying that I don't think they will have guts to make the cuts needed ( unless we end up with IMF at the door ) so I bet you will be ok.

Just a quick factual correction there Paul:

As I said in the post I currently have paid in to the scheme for 25 years. I retire in 8 years so that will be 33 years not 25 years service.

Our contributions also count double from 20 years on so I will actually have made a total of 46 years pension contributions (20 plus 2x 13) when I go at 55.

Old_Slaphead

Dr_Wu wrote: »

Just a quick factual correction there Paul:

As I said in the post I currently have paid in to the scheme for 25 years. I retire in 8 years so that will be 33 years not 25 years service.

Our contributions also count double from 20 years on so I will actually have made a total of 46 years pension contributions (20 plus 2x 13) when I go at 55.

How does that work then?

Presumably you started at 22 and by 55 will have 33 years service. But you've accrued 46 years contributions ???

Valli

Old slaphead - what the OP is saying is, that under the T&Cs of his pension (or her) once 20 years service is completed future contributions are in effect worth double, so 1 year of additional service accrues two years of pensionable service.

It will have been put forward as an idea to retain experienced employees and discourage them from leaving and entering the private sector, for a guess.

But no doubt those entering the sector NOW will not have the opportunity to enhance their pensions in this way, as so many schemes are cutting down/winding up.
*sighs as was member of a non-contributory scheme*

EdInvestor

Dr_Wu wrote: »

Now I'm a realist, I accept that the cost of these final salary pensions is high and probably unsustainable in the current economic climate and that changes will have to be made. I personally don't object to making increased contributions.

Does anyone have any thoughts on what at the end of the day the changes which will affect me are likely to be given that by the time any legislation is passed I'll have been in the scheme for 26 years and likely only be 7 years from retirement?

I'd expect that public sector pensions will move from final salary to career average basis for future contributions over the next few years.This would not affect you to any great extent however, as the vast majority of your contributions will be on the original basis, which wouldn't be changed retrospectively

Andy_L

Service acrued already is protected by law, only future service can be changed (including losing the "double counting" of years.
Whilst the gov could "change the law to let them break the law" if you see what I mean it opens such a can of worms that its extreamly unlikely

marklv

Dr_Wu wrote: »

Hi there

I'm in the fortunate position of having 25 years service with the NHS and having Mental Health Officer status which basically means I now have 30 years pensionable service and can retire on full pension at 55 in 8 years time. So far so good.

I've been increasingly aware through the media that moves are afoot to cut the amont spent on public sector pensions and that depending on which paper you read "pensions are to be slashed" etc.

Now I'm a realist, I accept that the cost of these final salary pensions is high and probably unsustainable in the current economic climate and that changes will have to be made. I personally don't object to making increased contributions.

Does anyone have any thoughts on what at the end of the day the changes which will affect me are likely to be given that by the time any legislation is passed I'll have been in the scheme for 26 years and likely only be 7 years from retirement?

I know it's guesswork but I'd be interested in people's opinions especially if there's anyone out there in a similar situation.

Steve

I wouldn't worry. No sensible government would ever slash existing public sector pensions unless they want a general public sector strike. New joiners may well by forced to go into less beneficial schemes, but existing members will almost certainly be left to choose between keeping their old scheme and joining the new one.

Ignore the idiots on this forum who vomit sour grapes - stick two fingers up at them!

marklv

Paul2009 wrote: »

Sorry to sound harsh put I hope a future gov DOES stop you from taking your full pension at 55 and are made to work till 65 to get the full pension. There is no way on earth you will have paid in enough in 25 years to cover the cost of paying a full
indexed linked pension from age 55.

After saying that I don't think they will have guts to make the cuts needed ( unless we end up with IMF at the door ) so I bet you will be ok.

You stink of sour grapes!

Up yours mate. :beer:

marklv

EdInvestor wrote: »

I'd expect that public sector pensions will move from final salary to career average basis for future contributions over the next few years.This would not affect you to any great extent however, as the vast majority of your contributions will be on the original basis, which wouldn't be changed retrospectively

Based on what has happened recently in the civil service the final salary scheme will be replaced with a slightly less advantageous career average one, but members of old schemes will be to stay in them. Moving to a new scheme will be optional unless you are a new joiner.