Please Help - Opting Out of NHS Pensions

TheoL

Hi

I am very much an avid reader rather than a poster. I need some advice which I am having big trouble getting from my employers. Apologies in advance - long post.

I took voluntayr redundancy in April 2011.

I returned to the NHS on a bank basis on a much lower band in July 2011. I agreed to contribute to NHS pensions as I was told that I could have pay protection by my employer. I later found out from NHSPA that I am not able to. By that time, 1 month of contribution has been taken from my salary.

I wrote to my employer explaining that I do not wish to contribute and could they please refund my one month contribution. They asked me to sign an SD502 Form, indicating that I wish to opt out of NHS Pensions. I was told that I have to backdate this to July when I first returned to work in the NHS.

If I sign this Opt Out Form:

1. Does it mean that I only wish to cancel my contribution for this employment only? And does it mean that I am opting out of NHS Pensions completely?

2. When I come to draw my pensions at 60, will it be based on the salary in April or will it be based on the much lower salary with this employment?

3. Does it mean that I will not be able to re-join the NHS Pensions in future employment, and at the 1995 terms?

I am sorry to have to ask for help from people in the forum when I should be be ableto get answers from my employer. They have been less than helpful and three different managers in Payroll/Finance have all told me slightly different things over the last 3 weeks. I am very worried and do not know what to do.

Many thanks for any help and advice in advance.

snowcat53

Your pension rights up to April should be now preserved and you will receive a pension based on that final salry (uprated by CPI) at 60. This will not be affected by your now opting out. Effectively you would be starting a new pension now on the lower salary although i dont know if this would be under 1995 or 2008 scheme- ask.

However are you sure you want to opt out? Why?

atush

Why would you opt out? What do you mean by 'pay protection'?

TheoL

snowcat53 wrote: »

Your pension rights up to April should be now preserved and you will receive a pension based on that final salry (uprated by CPI) at 60. This will not be affected by your now opting out. Effectively you would be starting a new pension now on the lower salary although i dont know if this would be under 1995 or 2008 scheme- ask.

However are you sure you want to opt out? Why?

Thank you Snowcat53 for taking the time to respond.

I was told that it would be under the 1995 section.

I wanted to opt out because this post is lower in salary by around 20K, and I am only goingto be in it as a Bank basis for about 4 months. I am worried that it would negatively affect my pension benefits when I claim at 60.

My Pension Manager at my employer's also confirmed that my optimum final salary is the one at April 2011.

So I thought it is safer and easier if I opt out.

TheoL

atush wrote: »

Why would you opt out? What do you mean by 'pay protection'?

Thank you Atush

Reason for opting out as above.

I was given to understand that pay protection is protecting a particular salary so that it is not negatively affected if you choose to step down and do a lesser paid job with less responsibility.

snowcat53

TheoL wrote: »

I wanted to opt out because this post is lower in salary by around 20K, and I am only goingto be in it as a Bank basis for about 4 months. I am worried that it would negatively affect my pension benefits when I claim at 60.

I think i answered that point already. There are 'stepdown' rules to ensure that someone who takes a less well paid job at the end of their career does not lose out .

However you should get proper advice on these questions from your pension dept or (better ) from NHSBA.

There are also rules about rejoining the pension scheme after leaving it -are you clear this is allowed?

If it is all ok you may be throwing away a very good deal by opting out.