State Earnings Related Pension not correct

moneyistooshorttomention

Are you telling me LOL - re the system being complicated. Whew! By the look of it - that's for sure.

I thought it would be relatively simple to understand (like my Civil Service pension) - which basically boils (boiled) down to 40 years is full pension and each year you work is 1/40th of that and it comes as £x pension pa and £y lump at retirement and I was able to pretty much work out for myself what the figures should come to - to check them.

Basically - it looks rather like we are supposed to trust the DWP to get it right then by the look of it???:eek:

I will have a good read later of the links I've been given on this thread and see if I'm any clearer on whats what then.

moneyistooshorttomention

Whilst I'm clarifying what the position is - I know my Civil Service pension will get uprated for inflation annually and so will my Basic State Pension.

Will my Serps Pension and Graduated Pension have the exact same cost of living rise annually as my Basic State Pension from start of receipt of rest of my pension onwards? I presume they do - as they come under the banner of "State Pension".

- ie if I get 2.5% 2016 cost of living rise on Basic State Pension, then its that same 2.5% cost of living rise that would be applied to my Serps and Graduated Pension and the 2016 cost of living rise would therefore be (assuming its not more than 2.5%):

Basic State Pension goes up by 2.5% to £118.85
Serps goes up by 2.5% to £18.79
Graduated goes up by 2.5% to £1.64

Total 2016 - 2017 = £139.28 and my Civil Service pension and keeping fingers crossed that the £200 pa single persons Winter Fuel Allowance gets a cost-of-living rise (as there doesn't seem to be an automatic mechanism to uprate that - and its down to Government "goodwill").

hugheskevi

Will my Serps Pension and Graduated Pension have the exact same cost of living rise annually as my Basic State Pension from start of receipt of rest of my pension onwards? I presume they do - as they come under the banner of "State Pension".

No. Basic State Pension is highest of CPI, earnings growth or 2.5%. SERPS and Grad are linked to CPI, but will not be negative.

and keeping fingers crossed that the £200 pa single persons Winter Fuel Allowance gets a cost-of-living rise

Winter Fuel Allowance doesn't get automatic increases, it tends to be played around with by politicians according to whatever they feel like doing at any given Budget.

missbiggles1

moneyistooshorttomention wrote: »

Just got my calculator out again and Serps would be £23.25 per week at the same inflation rises as Graduated Pension.

Thus the "extra" bits of pension would come to £23.25 + £1.60 = £24.85 per week on top of my work pension and full Basic State Pension.

The mystery deepens - from the fact I could swear I recall the "extra" was that £35 or so 3/4 years back...

So the only possible explanation I can think of (apart from them making a mistake) is that maybe that "averaging out" that Serps has over the "average 30 years of worklife", rather than the "best 20 years" (as it used to be) has included being averaged out over the gap between my Retirement Age of 60th birthday and that personal revised State Pension Age of mine nearly 3 years later.

As my income has been/is pathetically low at the moment - whilst its work pension only. So much so that I don't pay any tax.

I don't know whether this is true or not but the other obvious explanation is that you've remembered the figure incorrectly.

xylophone

First of all, you get the basic state pension to which your NI contributions have entitled you - as you have at least thirty years you will receive
£115.95

Each year this will increase by 2.5% or CPI or average earnings, whichever is the greatest. This is the so called "triple lock".


You were in employment before 1976 so are entitled to some graduated pension on top of the BSP and this also increases annually with CPI
http://www.monetos.co.uk/pensions/state-pensions/graduated/claiming-inheriting/

The SERPS scheme was introduced in 1978 - employers/employees paid additional NI contributions depending on salary to build up an additional state pension on top of the Basic State Pension.

However, in return for guaranteeing a pension that was at least as great as SERP, the employer could pay a lower rate of employer/employee NI. (Contracting Out).

This was the Guaranteed Minimum Pension. The GMP system ended in 1997 with the introduction of the Scheme Reference Test.

Originally, the Government agreed to pay all inflation linked increases on the GMP at State Pension Age. In 1988 this changed to the Scheme being responsible for increases up to 3% - this is why pre 88 GMP and post 88 GMP are relevant to your pension.

In 2002, SERPS ended and S2P began. It was possible for even contracted out employees to earn some S2P if they were on a modest salary.

The age at which GMP becomes payable is 60 for women and 65 for men and this has not changed even though State Pension Age has.


When you took your CS pension at age 60, the CS could have decided to apply certain rules to your pensions increases - your pre 88 GMP and post 88 GMP could have been split out from your total pension and no increase paid on your pre 88 GMP and only up to 3% CPI inflation on your post 88 GMP - this was because of what the Government of the day agreed concerning such increases.

However, the CS, in common with other Public Service Service Schemes chose to be generous to its pensioners and continue paying the inflation increase on the whole of the pension until State Pension Age.

http://www.civilservicepensionscheme.org.uk/media/14453/pensioners_newsletter_2013.pdf

Once you reach SPA, the splitting out will occur.

Have a look at this on Page 7 of the LGPS Booklet http://www.yourpension.org.uk/Files/Files/In%20The%20Scheme/5.%20GMPGuide240211.pdf

The Pre 97 ASP shown on your statement is what you would have earned in SERPS during the period - it is reduced by what the CS pay you as a result of contracting out - the contracted out deduction.

moneyistooshorttomention

xylophone wrote: »

The age at which GMP becomes payable is 60 for women and 65 for men and this has not changed even though State Pension Age has.


.

I didn't know that.

I'm now wondering whether I should have been receiving that measly little £1 or so per week of Graduated Pension each month since retirement, as well as my Civil Service pension.

It would be rather difficult to tell - as I specifically enquired about "payslips" for my income - even after it had changed from salary to pension. I was astonished to find there doesn't seem to be any mechanism to give pensioners monthly payslips for their income (or even as much as a yearly one at annual cost-of-living rise time each year). The only information I am given about my income is to check the amount I receive into my bank account each month and I have to check the April one particularly each year (ie to see how much my inflation rise was - and I deduct this years from last years and work out what my percentage rise was).

This really surprised me - as I believe the law demands employees receive proper payslips - so not even receiving as much as annual one once you count as retired employee came out of the blue.

For all I know - I could be being paid my "peanuts" Graduated Pension each month along with my Civil Service pension?? Looks like I'd better contact the payer and ask if I am. If not - then I'm owed money for that as from 60th birthday. Not much admitted - but it will be over £100 they owe me - so I need to know whether I have to ask for monies owed on that.

xylophone

Graduated Pension is not the same as GMP.

GP is claimed with State pension see link http://www.monetos.co.uk/pensions/state-pensions/graduated/claiming-inheriting/

Re Civil Service Pension advice

http://www.civilservicepensionscheme.org.uk/news/2015-pensions-increase/

moneyistooshorttomention

Thanks. Its all becoming clearer.

....and lots of reading for me to do...

moneyistooshorttomention

Caught up on reading these links now - thank you.

Well...well....and I thought I should be receiving annual payslip/P60 and that reading has confirmed I should be.

I've duly sent off a "rocket" to my pension provider - asking rather firmly for my missing information since retirement on that:cool:

EDIT; Thought my cost of living rises were rather low - my work pension only increases by CPI (as well as that Serps and Graduated Pension). Not good news....

xylophone

Well...well....and I thought I should be receiving annual payslip/P60 and that reading has confirmed I should be.

At least you're receiving the pension.......;)


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