Teachers Pension (N.Ireland)

tigerspill

Hi,

My wife just received her pension statement.
This novel to a CARE scheme last year but I have a question about the former final salary part.

The statement has a "Pensionable Salary at 31/3/16".
But there is another row which says "Salary Period used" and this shows a there year period between 2006 and 2009. This is significantly higher and is the number used in the pension calculation.

The pension booklet says -
The benefits accrued under the current final salary arrangements will be based on the final salary at retirement. If you were in pensionable employment on or after 1 April 2007 then your average salary will be the better of:
-  average salary over the last twelve months of service; or
-  average of your best three re-valued years’ salaries of the last ten
years of pensionable employment.

So I assume that the second option has been used.

Does anyone know why it is higher? It mentions "revalued" years. Does this mean it is indexed from the average date or something?

Thanks

jem16

tigerspill wrote: »

So I assume that the second option has been used.

It will be at the moment as that is higher than final salary just now.

Does anyone know why it is higher? It mentions "revalued" years. Does this mean it is indexed from the average date or something?

Thanks

Each year over the last 10 years is revalued using the PI ( Pension Increase ) factor - in other words it's all the RPI/CPI increases from that year to the current year. Once the revalued salary is known then they take the average of each group of 3 years. If that average is higher than the final salary over the last 12 months then that is the figure that is used.

Finst

jem16 has already given a good explain, but to confirm in other words, it means that each of the last 10 years' salary are revalued to today using inflation, so that they are all comparable in real terms (net of inflation). Then you pick the best average of 3 consecutive years.

Assuming that recent salary increases have been below inflation (most have been well below), this will give a higher number than the last 12 months salary

tigerspill

Thank you both.

This explains it well.

I guess teachers haven't had rises in the past few years which explains things.