CETV How much would temp you?.

neilvw

It would be interesting to see what your current scheme would offer for the transfer-in, once you have that figure.

brewerdave

5% a year increases guaranteed ??? I'd be very worried that the scheme was going to be underfunded (if not already) -and might go under in the near future:eek:

ajbell

The scheme is well funded but now absorbed into the Royal Ordnance/Baesystems pension scheme but retaining its own rules.
About 20 years ago I was given 4 extra years service to get rid of a surplus before being taken over by Baesystems.
This particular scheme has no new members and I am probably the youngest deferred member.

ajbell

Found the "certain limits " bit but don't fully understand it.

What are three sections of the Royal Ordnance Pension Scheme and how do they differ?

The Crown Service and 1984 schemes merged on 6 April 1991 to form The Royal Ordnance Pension Scheme, and then in 1995 the BMARC scheme merged with the Scheme. The three membership categories in the Scheme correspond to the three old schemes:

Crown Service: This section is for members who were part of The Royal Ordnance (Crown Service) Pension Scheme. 75% of membership.

1984: This section is for members who were part of The Royal Ordnance (1984) Pension Scheme. 21% of membership.

BMARC: This section is for members who were part of the British Manufacture and Research Company Limited Pension and Life Assurance Scheme (BMARC). 4% of membership.

Benefits differ between the sections of the Scheme: Crown Service Section: pensions (in excess of the Guaranteed Minimum Pension (GMP)) are guaranteed to increase in line with the RPI.

1984 Section: pensions (in excess of the GMP) are guaranteed to increase in line with RPI up a limit of 5% in each year.

[COLOR="rgb(255, 0, 255)"][COLOR="rgb(255, 0, 255)"]BMARC Section: pensions (in excess of the GMP) are guaranteed to increase at 5% each year subject to the limits imposed by Her Majesty’s Revenue & Customs (HMRC).[/COLOR][/COLOR] Members of the Royal Ordnance Pension Scheme are contracted-out of the State Second Pension (S2P), the second tier of the State Pension. This means that the Scheme replaces some of the pension that the second tier of the State Pension would have paid to you at retirement. Your basic State Pension (the first tier) remains unaffected and you remain eligible to receive it in addition to your pension from the Royal Ordnance Pension Scheme.

ajbell

So the "certain limits " are HMRC limits.
Any idea what they would be?.

mania112

i 'think' there's something about what happens if you die within the 5 year guarantee period that would restrict the annual increases.... but i'm less than confident on that.

redbuzzard

I hope we get to know what the CETV is here, the suspense is almost unbearable!

CETVs aren't calculated from annuity rates. The factors will have been proposed by the actuary and will have regard to the way the benefits are funded. If the scheme is well funded and has been largely de-risked (noting that almost all members are over 50) and is funded mainly by matched bonds then the CETV could be exceptionally good given the low gilt yields likely to have been assumed at the last valuation. The higher the reliance on growth assets, the higher the discount rate and the lower the CETV. If there is a substantial deficit, in theory the trustee can decide to reduce transfer values. In practice they probably won't have done that, unless they think there is a real risk of a default.

The range of possibilities is very wide! The guaranteed 5% will push it up. That is a hell of a guarantee by most people's standards. My DB pension is RPI up to 5% in deferment, then a mixture of RPI capped at 2.5% and 5%.

ajbell

I will come back and tell everyone what I am offered.


this year other pensioners in the Royal Ordnance schemes were given 1.2% I think but my scheme was 5% as promised.
Looking forward to getting the figure.

brewerdave

5% guarantee is amazing! Good luck to you -just bunged 5% in for my current pension taken early -I'd be ~ £7k p.a better off by now compared with the acual RPI up to 5% .

AlanP_2

Unlikely to have the option of transferring it into current DB / FS scheme I would have thought with 10 years service already. My experience is you have to make that choice within first 12 months of new employment.