Public sector Pension union claims re dismissal

dh-york

My husband is being told (in writing) that the government is changing his pension scheme just like many of us have had changes to already.

However the FBU claim that if my anyone in future is dismissed under 'capability' i.e. age 59 they are no longer pass the fitness test for the Fire Brigade that they will also leave with no pension.

Now my husband pays into this pension 12% salary + employer contributions, surely they cannot 'take' any of his pension fund off him ??

Maybe they can bend the rules about what sort of pension he ends up with i.e. no longer final salary, but please god tell me they are not entitled to take his pension pot accrued to date ???

FBU are using this as a reason to say Yes to a strike ballot, please tell me they are putting a spin on it it cant be legal ????:money:

hugheskevi

Presumably based on much the same information as at this link on the FBU website.

surely they cannot 'take' any of his pension fund off him

No, accrued pension cannot be taken.

The FBU claims that "under current proposals, firefighters who retire or are forced out of work at age 55 will lose around 50% of their pensions" will be based on some sort of comparison of what pension a firefighter remaining in employment until Normal Pension age would receive, compared to one leaving at age 55. Half is a very big amount given that Normal Pension age for active members is 60 so it would be helpful if they outlined their assumptions. It probably reflects to a large extent the difference in Normal Pension age for active and deferred members, but can't be sure without the key assumptions being documented.

Maybe they can bend the rules about what sort of pension he ends up with i.e. no longer final salary

It is not bending the rules, they are changing the basis of future pension provision, as any employer (subject to consultation) is free to do with a few exceptions.

but please god tell me they are not entitled to take his pension pot accrued to date

Aside from the RPI-CPI issue and whether or not that was an accrued rights issue (which was decided in law that RPI indexation was not an accrued right), no.

bigfreddiel

dh-york wrote: »

....t they will also leave with no pension.

its aazing what hogwash people disseminate when all you have to do is read your pension's t&cs

once you accrue pension it cannot be taken away

it can be stolen tho' but thats not going to happen

dont worry your partners pension is safe

fj

hyubh

hugheskevi wrote: »

Half is a very big amount given that Normal Pension age for active members is 60

The OP quoting a contribution rate of around 12% indicates her other half is in the 1992 scheme (this was closed in 2006 to new members). As such, his scheme operates a double accural rate for the final 10 years of 30, similar to the 1987 police pension scheme.

BobQ

Agreed they cannot take away what is accrued as this makes clear.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/14943/120524_-_Final_Agreement_-_Fire_-_FINALv2.pdf

BobQ

dh-york wrote: »

FBU are using this as a reason to say Yes to a strike ballot, please tell me they are putting a spin on it it cant be legal ????:money:

To be fair the FBU has to present the arguments to its members who include many in their 50s who will be relatively unaffected and many who are younger who stand to lose a lot compared with what the current system would offer them.

Whether the changes are fair is a political debate, but many public sector workers do stand to lose a lot compared with the present arrangements. Talk of 50% reduction is alarmist but if you aggregate the impact of the change in indexation to CPI and the move to career average pensions you can demonstrate a substantial impact. Those who have no pensions will mostly say tough but the FBU is there to explain the impact on its members.

However the FBU bulletin

http://www.fbu.org.uk/wp-content/uploads/2013/05/9401-FBU-Pensions-Bulletin-No-11-NFPS-NOT-STANDARD-GREEN-LR.pdf

does highlight the problems of fitness among the post 55 year staff and the lack on non-operational jobs for them to do. So there are real issues which the proposed 2015 scheme allows the employers to exploit. Again some will say so what, its what others in physically demanding jobs face.

As ever those who choose not to protest, acquiesce to the changes.

hyubh

BobQ wrote: »

many who are younger who stand to lose a lot compared with what the current system would offer them.

Hmm... is that really the case? (Having not crunched the numbers, that's a genuine question.) The 1992 scheme being closed to new members in 2006 was arguably a much bigger development for the 'many who are younger'. Conversely, those with (say) 12 years in the 1992 scheme come 2015 are going to be much more worse off than they would have been, or so it would seem at first glance.

Whether the changes are fair is a political debate,

The 1992 scheme is *very* expensive...

dh-york

Thank you all for your help

:j

BobQ

hyubh wrote: »

Hmm... is that really the case? (Having not crunched the numbers, that's a genuine question.) The 1992 scheme being closed to new members in 2006 was arguably a much bigger development for the 'many who are younger'. Conversely, those with (say) 12 years in the 1992 scheme come 2015 are going to be much more worse off than they would have been, or so it would seem at first glance.

The 1992 scheme is *very* expensive...

In general terms a switch from a Final Salary Scheme to a Career Average Scheme makes little difference to those whose careers have peaked but is less favourable to those younger people who spend their early years in lower paid posts than in their later years. Obviously it depends on the terms of those schemes but this is typically the case in public sector schemes.

hyubh

BobQ wrote: »

In general terms a switch from a Final Salary Scheme to a Career Average Scheme makes little difference to those whose careers have peaked

'In general terms' was not what I was talking about: in the specific case of the 1992 firefighter's scheme, the loss is the double accrual for the final 10 years of 30.

Obviously it depends on the terms of those schemes but this is typically the case in public sector schemes.

In the LGPS, moving to a CARE structure is likely to increase liabilities for those currently near retirement given CPI's outpacing of wage inflation.

BobQ

hyubh wrote: »

'In general terms' was not what I was talking about: in the specific case of the 1992 firefighter's scheme, the loss is the double accrual for the final 10 years of 30.

But it is what I was talking about. In general its true of final salary schemes but of course depends on the accrual rate of the career average scheme and special terms such as the double accrual to which you refer.

In the LGPS, moving to a CARE structure is likely to increase liabilities for those currently near retirement given CPI's outpacing of wage inflation.

The OP was not asking about scheme liabilities but the impact on an individual pension and the claims of the FBU that the value of the pension is reduced by 50%. The point I was making is that for those who spend most of their career in a career average scheme it will be cheaper than if they were in a FS scheme assuming their job has some career progression. Why else is the Government making the change? In addition they appear to be offering some protection to those nearing retirement but making changes that will further impact the pensions of those with much longer in retirement. Wage inflation is still likely to increase faster than CPI in the longer term.