NHS Pension - Part Time Work

wotsthat

I've a family member who has asked me to sense check an idea they have.

Currently they're working part-time and contributing to the 1995 scheme. They reckon that if they go full-time in one of the final 3 years of employment their pension will be based on a full time rather than part time wage.

As I read it the scheme bases all pension calculations on a full time equivalent but adjusts the number of years down for part time work.

They've asked the scheme admin but are waiting for a reply.

So a career of part time working and a full time pension just for one year working full time hours? Too good to be true?

jem16

wotsthat wrote: »

As I read it the scheme bases all pension calculations on a full time equivalent but adjusts the number of years down for part time work.

That's correct. If you work 20 years of part time say at 0.5 of the working week you will accrue 10 years service instead of 20 years. When it's calculated it's always the full time equivalent wage that's used.

So a career of part time working and a full time pension just for one year working full time hours? Too good to be true?

Yes it is.

wotsthat

jem16 wrote: »

Yes it is.

Sorry, to which question is the answer yes?

It's possible to get a full pension based on only one year working full time or, yes, it's too good to be true and this is wrong?

molerat

Yes it is too good to be true.

If working .5 FTE you accrue .5 years service per year worked.
The pension is based on the FTE pay for that post i.e 2 x actual pay received.
Going full time for the final 3 years will add an extra 1.5 years to the service.
It will have no effect on the pay rate that the pension is based on.

Spirit_2

It is too good to be true.

Your relatives part time years will count as part time years and the full time years will count as full time years.

Using the example of 20 years worked at 50% - that will count as 10 years. If a further 2 years are worked at full time, that would total 12 years reckonable employment.

It is an 80th scheme so the pension will be 12/80 x Final salary. The final salary calculation is based on full time, but the share of it based on reckonable employment.

CLAPTON

wotsthat wrote: »

Sorry, to which question is the answer yes?

It's possible to get a full pension based on only one year working full time or, yes, it's too good to be true and this is wrong?

of course it's wrong : it would be a outrage if some-one could work parttime for 20 years then work fulltime for one year and get 21 full years of pensionable service (i.e. they actually would get 10.5 years of the fulltime salary)

it's already been explained that they work out the equivalent full years and apply that to the notional full time salary whether or not they have ever worked full time

jem16

wotsthat wrote: »

Sorry, to which question is the answer yes?

It's possible to get a full pension based on only one year working full time or, yes, it's too good to be true and this is wrong?

As molerat says - it's yes to the too good to be true question.

wotsthat

Spirit wrote: »

It is too good to be true.

Your relatives part time years will count as part time years and the full time years will count as full time years.

Using the example of 20 years worked at 50% - that will count as 10 years. If a further 2 years are worked at full time, that would total 12 years reckonable employment.

It is an 80th scheme so the pension will be 12/80 x Final salary. The final salary calculation is based on full time, but the share of it based on reckonable employment.

It didn't sound right but I wouldn't have been entirely surprised to find out it was.

I wasn't sure of the reckonable employment part and whether years/ part years were accrued or whether it really was a case of picking the best case scenario from the final 3 years employment.

A number of their colleagues have gone full time just before retirement - presumably then to boost savings just before giving it up.

jem16

wotsthat wrote: »

A number of their colleagues have gone full time just before retirement - presumably then to boost savings just before giving it up.

As it's NHS they probably have a rumour circulating that by going full time just before retirement they will get a full pension.

atush

going full time in the last year will be beneficial as

a, they would get a full years pension rather than .5, and

B they can whack up their savings thu a PP, S&S isas or cash.

wotsthat

jem16 wrote: »

As it's NHS they probably have a rumour circulating that by going full time just before retirement they will get a full pension.

Yes, the rumour mill is where it came from.:)

At least they checked. It's two weeks and counting for a response to the query from the scheme admins.