Barclays Final Salary pension GMP/Excess revaluation & Anti-franking

SnowMan

That sounds promising Mike.

So it may be a case after all that they will step up the pension at 65 to the revalued GMP at 65 plus revalued excess to 60 under the normal retirement option, the 'correct' approach as I am calling it.

That is the only outcome that makes sense to me.

There is now all round agreement that actuarial equivalence to the NRA pension from 60 with no step up at 65 because the revalued GMP will already be covered, is not consistent with the size of the early retirement pension quoted.

But note also that looking at the figures it appears actuarial equivalence to the NRA pension from 60 with a step up at 65 to the revalued GMP at 65 + unrevalued excess at leaving, is not consistent with the size of the early retirement pension quoted either (that is the early retirement pension would be lower than quoted if that was the step up)


It shows how important it is to persevere as you have done. I see some light at the end of the tunnel (just hope it's not the light of an oncoming train :rotfl:).

xylophone

However, your normal retirement quote may need a step up to cover your GMP and SPD.

Are TW now saying that the NRD quote is wrong and that Mike should be receiving both revalued GMP and revalued excess at NRD?

In which case at NRD his pension will be in excess of the £14,200 because there will have been no actuarial reduction at all?

If they are sticking with the £11025, then is the calculation using 'HIPPS rules" (see post 97) correct in which case "may be" a step up at 65 seems comprehensible?

Or must they pay Mike an additional £6745 at 65 and if so, why are they not saying that there will definitely be a step up at 65?

Or will they pay a pension equal to revalued GMP and revalued excess as at NRD at NRD and then provide a step up at 65 if the total pension at 65 is not equal to or greater than the GMP and excess revalued to age 65 ( I think that Mike calculated this as £15000+?

Or is the scenario sketched out in my post 97 (to attempt explaining the "may be" ) the answer?

Or is the truth of the matter that there can be no step up to his pension at 65 if his total pension at that age is greater than his revalued GMP - if so, then it is obvious that there can be no step up?

I think I'm shunting myself into the sidings for a rest...:D

SnowMan

xylophone wrote: »

Are TW now saying that the NRD quote is wrong and that Mike should be receiving both revalued GMP and revalued excess at NRD?

I think they are still saying that if Mike takes his deferred pension at the NRA of 60 he will then be paid the unrevalued GMP plus statutorily revalued excess at 60 estimated to be £11,025pa (= 1803 + 9222).

However they are now accepting that there will be a step up at age 65 which they are asking the actuaries to confirm (previously they were saying there was no step but Mike has convinced the administrators there must be a step). I am expecting the actuaries to say that there will be a step at 65 up to the revalued GMP at SPA plus the statutorily revalued excess to age 60 so the pension will increase to about £17,770pa (= 8547 + 9222).

If Mike alternatively takes early payment of the deferred pension (the £14,209 pa quote at 31st January) then there will be no step. So under the early retirement option he has a higher pension than the NRA option from 60 to 65 and then after 65 a lower pension as the step at 65 takes the NRA option above the early retirement option.

All to be confirmed or not by the actuaries.

And the state pension deduction to be applied from 65 also to reduce these amounts.

I''ll do an updated version of post 31 if we get the expected response from the actuaries.

MikeFloutier

Thanks guys, I'll post again when I hear the actuary's response from TW.

However, as you say, its starting to look more sensible finally.

MikeFloutier

In the meantime, I'll revisit the scheme booklet when we get home at the weekend. I guess it'll make a lot more sense following the last fortnight's posts.

xylophone

I'll revisit the scheme booklet

An excellent idea but do you also have access to the Scheme Rules?

Remember Mr Ainsworth's view of his Scheme booklet?

xylophone

Scheme Rules?

Having said that, you may notice that the Ombudsman refers to "Scheme Rules and overriding legislation.....

I am wondering now if TW are correct in calculating that an early pension is paid including revalued GMP to age 60 when a pension taken at NRD is not - surely a more logical (and fairer?)position (since revalued GMP does not have to be paid until GMP age) would be for the early retiree to receive his unrevalued GMP plus his revalued excess, the latter actuarially reduced by the relevant factor.
Then both would receive any necessary step up at GMP age - this would also seem easier administratively?

Incidentally, I am assuming that the SPD will not take place until you reach SPD age which in your case no longer exactly coincides with GMP age, though there is not much in it.



However, we'll just have to wait for the Scheme Actuary to pronounce judgement!

xylophone

Incidentally, (although I am sure that you have read enough about pensions to last you several lifetimes), cast your peepers over this http://www.mycompanypension.co.uk/State-Pension-Age-Pensioner-Members-DB

Makes me want to sing that old song..."There are more questions than answers ....... the more I find out the less I know.....":rotfl:

MikeFloutier

Thanks Xylophone, I see what you mean!

I came across this HMRC link regarding NICO which gives a very precise description of Anti-franking and exactly what situations it applies to. Also what situations are exempt - which may include my early retirement quote.

The relevant details start on page 48 with the exemptions on page 50.

It appears to add support to our view regarding my NRD quote although I'm certainly not as skilled at reading these things as you guys; what do you think?

SnowMan

MikeFloutier wrote: »

Thanks Xylophone, I see what you mean!

I came across this HMRC link regarding NICO which gives a very precise description of Anti-franking and exactly what situations it applies to. Also what situations are exempt - which may include my early retirement quote.

The relevant details start on page 48 with the exemptions on page 50.

It appears to add support to our view regarding my NRD quote although I'm certainly not as skilled at reading these things as you guys; what do you think?

Xylophone linked to the same document CA14 in post 59. I'm afraid it was my fault that we didn't look at that closer as I said it wasn't useful (not quite sure what I was looking at when I decided it wasn't useful).

It actually covers it perfectly.

As you say the early retirement quote is exempted provided that it is of equivalent value to the NRA option (to which the anti-franking check does apply).

The early retirement options is what it is actually referring to in para 87 3a of PSA93 as pointed out by the Pensions Ombudsman in the Biggs case.