LGPS - understanding benefit statement

cambs1999

Hi,

I'm just starting to look in more depth to my pension with LGPS.

I have my 2015 benefit statement and wondered if someone can help me understand it. It has my final salary pensionable pay at a much higher figure than my CARE pensionable pay main section. I'm part time & the CARE pensionable pay is more like my part time income.

Am I to assume that the amounts given as my projected final salary pension and the protected CARE pension & total projected annual pensions at NPA are correct or are the figures based on a full time salary which means I need to break them down further!

Anyone have any ideas as I'm not sure why the amounts would be different as I've been part time for years.

It all seems very confusing.

Thanks

quotememiserable

Effectively you have two pensions, what you earned in the old scheme - which keeps it's value from when it stops, increasing with inflation, plus your new care pension which has only been running since that was introduced, so has much less in it. Over time the care section will rise as you add years.

hyubh

cambs1999 wrote: »

It has my final salary pensionable pay at a much higher figure than my CARE pensionable pay main section. I'm part time & the CARE pensionable pay is more like my part time income.

Simplifying slightly, the CARE pay figure will be your actual pay for the year whereas the final salary pay figure will be whole-time equivalent. This doesn't mean your final salary benefits are as if you were full time, since your reckonable service will be pro-rated down instead (doing things this way means someone who goes part time close to retirement wouldn't suddenly lose out, and conversely, a part timer who switched to full time near the end wouldn't get a massive boost).

Am I to assume that the amounts given as my projected final salary pension and the protected CARE pension & total projected annual pensions at NPA are correct or are the figures based on a full time salary which means I need to break them down further!

I would imagine two figures have been provided, one for the accrued pension to date and one for if you stayed at your current rate of pay and hours until normal retirement age. Unless the service history shown does not indicate part time hours (which would be a mistake), the projection won't be assuming full time working.

hyubh

quotememiserable wrote: »

Effectively you have two pensions, what you earned in the old scheme - which keeps it's value from when it stops, increasing with inflation

Not quite - public sector schemes kept a final salary link for actives when they went CARE. In other words, while the amount of reckonable service for final salary benefits has stopped, the 'final pay' to be used in calculating the value of that service is only determined when the member leaves.

Silvertabby

hyubh is right. Changing the benefit statements to include CARE yet making then easy to understand was a bit of a nightmare!

As a now retired LGPS admininstrator, may I add that the benefit statement is based on the information provided by your employer in their year-end returns. Unless the information is blatantly different (ie, salary has trebled?) the pensions department can't/won't check that information (why? because, for instance, the LGPS I worked for adminstered the pension scheme for over 80 employers and it would have taken until next year's return to check every single record) . However, when a member leaves their job or retires, then a full check of the record is carried out.

However, I would recomment that you check all of the statement - hours, current salary and whole time equivalent pensionable pay (for your pre 2014 final salary benefits) and speak to your pensions administrator if something looks really off. If something has been lost in translation, then it's much easier for all parties to get it sorted in the current financial year.