can they change NHS pension overnight? from Final salary to Average salary?

Nurse99

Hello

I am an NHS nurse, on a Final salary scheme. I have 18 months before I have Full years of pension, and am currently old enough to retire.


The government are planning to change from a final salary scheme to a Average salary scheme.

HOW QUICKLY can the Government do this? Can they do it overnight? or would i have time to consider my position after they make the announcement?

if they can change the scheme overnight then i would rather just retire now and get a part time job in the private sector

i am really worried thanks for all your advice.

jem16

Nurse99 wrote: »

HOW QUICKLY can the Government do this? Can they do it overnight?

Very unlikely.

Plus it would also be more than likely that your accrued benefits will stay as it is and it would only affect future benefits.

Old_Slaphead

Any such change will not be retrospective and will not affect and final salary entitlement already accrued.

Theoretically they could alter the scheme for future contributions at short notice but I would think it unlikely. I would think any changes are likely to be progressed over next few years.

Loughton_Monkey

I agree that if you have only 18 months to go, you are almost certain not to be affected significantly. Firstly, it will take a long time, and I'm sure they will go through 'consultation' and give notice. Then, as has been said, they cannot really reduce the rights already accrued, so that there will need to be a complicated 'transition period' in which new retirees will not quite get 'Final Salary', but some reduction for the most previous months to reflect the slightly lower entitlement.

Depending upon future pay rise levels, this will probably take 3 to 6 years to work through.

Even if it's rushed through, the actual difference it makes to you will probably be hardly noticeable.

Batchy

changes from final to average could be significant... depending on career progression...
they cannot really change accrued benefits, depending on how many years you have accrued, the reason being is they cannot at the last min move the goal posts.

At the end of the day and average salary scheme will still be better than a contribution based scheme... I would have thought!

Wornoutnurse

Well it looks like they've done it anyway:eek:
NHS pensions to go average instead of final salary from 12th April 2012

I'm in a slough of despond

I'm 57 in Feb 2011 and had already had my State pension moved to 64 yrs from 60 yrs (Been working full time since 1969, no breaks)
Now it's to be 65 yrs 3 months and they've changed the NHS as I've said above.
I'm on a good salary now, but haven't always been, so averaged out pension will be bad for me. Only choice is to retire in Feb 2012 at 58 and get a part-time job, while waiting 7 years for my State pension.
Wish I'd been a member of the NHS one for the whole of my career, instead of just the last 20 or so.
I'm betting there'll be hundreds, if not thousands of senior nurses like me, who'll have to bail out early. Not good for the profession.

molerat

Surely it will be 20+ years at final salary up to Apr 2012 and average salary for the remaining years. This will be the same as anybody moving jobs or scheme changes.

newleaf

Wornoutnurse wrote: »

Well it looks like they've done it anyway:eek:
NHS pensions to go average instead of final salary from 12th April 2012

I don't know where you have got this information from?
I certainly haven't seen it anywhere.

sleepless_saver

I've read absolutely nothing to suggest that the pension you have already accrued would be affected by future changes. There really would be riots on the streets if they tried to make it retrospective.

Why not phone up the pension scheme administrators if you're worried.

dunstonh

I'm in a slough of despond

Why? In the scheme of things there is little difference for you.

already had my State pension moved to 64 yrs from 60 yrs (Been working full time since 1969, no breaks)

The move from 60 to 64 was put in place over 15 years ago. The reasoning being equality. Are you now saying that only men can work that long and women cant?

'm on a good salary now, but haven't always been, so averaged out pension will be bad for me.

Career average is based on your period of membership in the career average scheme. Not your career average whilst you were not in the scheme.

I'm betting there'll be hundreds, if not thousands of senior nurses like me, who'll have to bail out early. Not good for the profession.

Only if they misread the information. There has not been a thing released to suggest any retrospective reduction. In the other pensions that have gone career average, its always been based on the period of membership in that version. Not beforehand. Effectively what will happen is that you will have two schemes. One will contain your old benefits accrued and indexed and the new one will be based on career average from that point forward. Given your age, its unlikely to make much difference as you are likely to be at or near the peak of your earnings on your career path already.

The main losers are the professions that used to "reward" people by promoting them in the last 2-3 years to a higher paid job so they could suddenly boost their pensionable income. Apparently quite common in the Govt backed schemes.

Andy_L

[QUOTE=dunstonh;37727196The_main_losers_are_the_professions_that_used_to_"reward"_people_by__promoting_them_in_the_last_2-3_years_to_a_higher_paid_job_so_they_could__suddenly_boost_their_pensionable_income._Apparently_quite_common_in_the_Govt_backed_schemes.[/QUOTE]

Thats one of those "bloke said, down the pub" statements - Annacedotally i've never seen it happen & i'm unawae of any evidence it's common.