BT Pension Scheme Review: Help please.

robin61

tigerspill wrote: »

I think it was part of the negotiation to close the BTPS. SO I guess that gain a lot that way. One of the big reasons for closing was not just cost, but predictability.

Absolutely. Another example of winners will be people who are still working for BT who are over 60 and have not been allowed to take their pension. If they retire once the changes come in those guys are going to get an enhancement that they would not previously have got.

Also taking the pension whilst still working is back although you need to agree to leave by a certain date to get it. I expect most will be reluctant to do that until there is more clarity. I wonder how it would impact your qualification for either redundancy or an early leaver package. They have just not made that clear at all.

robin61

tigerspill wrote: »

There have been new redundancy terms detailed (as opposed to a voluntary leaver scheme which have run many times). These seem very good, but they need to enter formal redundancy notice to offer this. However, I wonder will that offer a much enhanced leavers scheme similar to the new EVR scheme benefits to try and lose people on the same deal but without the hassle of redundancy.

That would be superb. Some of the changes they've put forward as part of the negotiations are surprising. So who knows ? I'm finding it all a bit unsettling. Patience isn't one of my virtues.

tigerspill

robin61 wrote: »

That would be superb. Some of the changes they've put forward as part of the negotiations are surprising. So who knows ? I'm finding it all a bit unsettling. Patience isn't one of my virtues.

I'm exactly the same. For me anyway, ideally I would be offered the new EVR and then wait a couple of years to 55 and take my pension with a much reduced actuarial reduction. That would be perfect if it kicked off in the autumn.

robin61

tigerspill wrote: »

I'm exactly the same. For me anyway, ideally I would be offered the new EVR and then wait a couple of years to 55 and take my pension with a much reduced actuarial reduction. That would be perfect if it kicked off in the autumn.

A possible fly in the ointment could be that BT has only committed to definitely keeping those new rates in place until June 2019. I think if I get the chance before then I'll grab it while it's there. However I'm a few years older than you at 57 and a half.

tigerspill

robin61 wrote: »

A possible fly in the ointment could be that BT has only committed to definitely keeping those new rates in place until June 2019. I think if I get the chance before then I'll grab it while it's there. However I'm a few years older than you at 57 and a half.

TBH, I think I will be grabbing whatever scheme comes. There is almost always a leavers scheme in the new year in preparation for cosy savings going in to the new FY. And often one in the autumn as well. Even if it was the normal leaver's scheme - March 19 would suit well.
Just have to wait an see. One thing is for sure, they will have to work hard to lose 13,000 people. Thats at least a third of the people in the impacted grades. So maybe they will be more generous. Here's hoping.

robin61

Actually this is looking a lot more positive for people approaching retirement than I had first thought it would be. I'm in scheme B and I've noticed the following.
1) The actuarial reduction rates for taking the pension early have been improved in our favour
2) The choice between taking the standard pension and a higher initial pension in return for a semi index linked pension looks like it has been improved and the difference between the two is now greater making taking the larger initial pension more compelling.
3) For anyone who has already worked past 60 or wants to there will be an enhancement for the pre 2009 element of the pension.
4) We've been told that from 2019 it will be possible to split the pension and take the pre 2009 element at 60 and take the post 2009 element at 65. Therefore avoiding any actuarial reduction.
5) We've been told we can ask to take the pension early whilst still working for BT as long as we leave within 2 years. Although it's not been made clear how this might impact your chances of an early leaver package or redundancy. So personally I would be cautious about doing this at the moment.
6) after initially telling us that AVC contributions would have to stop when the scheme closes they have put this temporary additional volountary contribution in place until September 2019 that can be used in a similar way to the AVC.
7) this will vary of course but for the last 2 years as a manager my pay increase has been pants and well below CPI. At least once our pensions are deferred we will get either a CPI or RPI increase depending on the scheme. At least I know I'm sure of that.

For me anyway, I think all of this gives potential early retirement hopefuls some more flexibility. It's certainly changed my way of thinking. Does it all point to BT wanting to get older people out of the door ?

For younger people the move from DB to DC is unlikely to be positive though and that's a shame.

tigerspill

robin61 wrote: »

Actually this is looking a lot more positive for people approaching retirement than I had first thought it would be. I'm in scheme B and I've noticed the following.
1) The actuarial reduction rates for taking the pension early have been improved in our favour
2) The choice between taking the standard pension and a higher initial pension in return for a semi index linked pension looks like it has been improved and the difference between the two is now greater making taking the larger initial pension more compelling.
3) For anyone who has already worked past 60 or wants to there will be an enhancement for the pre 2009 element of the pension.
4) We've been told that from 2019 it will be possible to split the pension and take the pre 2009 element at 60 and take the post 2009 element at 65. Therefore avoiding any actuarial reduction.
5) We've been told we can ask to take the pension early whilst still working for BT as long as we leave within 2 years. Although it's not been made clear how this might impact your chances of an early leaver package or redundancy. So personally I would be cautious about doing this at the moment.
6) after initially telling us that AVC contributions would have to stop when the scheme closes they have put this temporary additional volountary contribution in place until September 2019 that can be used in a similar way to the AVC.
7) this will vary of course but for the last 2 years as a manager my pay increase has been pants and well below CPI. At least once our pensions are deferred we will get either a CPI or RPI increase depending on the scheme. At least I know I'm sure of that.

For me anyway, I think all of this gives potential early retirement hopefuls some more flexibility. It's certainly changed my way of thinking. Does it all point to BT wanting to get older people out of the door ?

For younger people the move from DB to DC is unlikely to be positive though and that's a shame.

Hi,
Very useful summary. Just a couple of things -
1) Have you had any formal communication on the changes to the actuarial reductions. I heard 3% and 3.5% for Sections B & C respectively, but have not seen any official or formal document detailing this. I would like to see that before adjusting what I am planning.
2) Again, have you seen the details on this?

I totally agree with your last point - it has certainly changed what I am planning - if I can see the details documented somewhere.
If you have seen some of this could I ask you to point me in the right direction?

On Friday I did tweak my %age for the new BTRSS so I get the maximum "matching" level. I also put some into the new SAC - which can ultimately be moved to AVCs and get the resulting tax benefit. Didn't put much in yet until I can actually see the money on the Std. Life portal (from July's pay so hopefully will see in August).
Thanks

robin61

tigerspill wrote: »

Hi,
Very useful summary. Just a couple of things -
1) Have you had any formal communication on the changes to the actuarial reductions. I heard 3% and 3.5% for Sections B & C respectively, but have not seen any official or formal document detailing this. I would like to see that before adjusting what I am planning.
2) Again, have you seen the details on this?

I totally agree with your last point - it has certainly changed what I am planning - if I can see the details documented somewhere.
If you have seen some of this could I ask you to point me in the right direction?

On Friday I did tweak my %age for the new BTRSS so I get the maximum "matching" level. I also put some into the new SAC - which can ultimately be moved to AVCs and get the resulting tax benefit. Didn't put much in yet until I can actually see the money on the Std. Life portal (from July's pay so hopefully will see in August).
Thanks

I went onto the pension portal and did a quotation for retirement on 30 June (that's currently the latest date it will allow due to the scheme closing. I hope they will sort that out next month). Luckily I had one I had done a few weeks back for the same retirement date and I can see the differences in both the standard and semi index linked options.
I also rang the BTPension scheme help desk and asked them to send me the new accurarial reduction rates for scheme B. I had the previous ones so I can see the difference. As you say around 3% for B but I don't have C. If you ring them they will send you the rates straight away.

In August we will be able to contact Standard Life and change the funds for both the BTRSS and the additional volountary contributions. For now they will be invested in their default funds.

Also everyone need to make sure that they name their beneficiary for the 10x salary Life Insurance linked to the BTRSS. You can do that now via Your Rewards.

tigerspill

robin61 wrote: »

I went onto the pension portal and did a quotation for retirement on 30 June (that's currently the latest date it will allow due to the scheme closing. I hope they will sort that out next month). Luckily I had one I had done a few weeks back for the same retirement date and I can see the differences in both the standard and semi index linked options.
I also rang the BTPension scheme help desk and asked them to send me the new accurarial reduction rates for scheme B. I had the previous ones so I can see the difference. As you say around 3% for B but I don't have C. If you ring them they will send you the rates straight away.

In August we will be able to contact Standard Life and change the funds for both the BTRSS and the additional volountary contributions. For now they will be invested in their default funds.

Also everyone need to make sure that they name their beneficiary for the 10x salary Life Insurance linked to the BTRSS. You can do that now via Your Rewards.

Thanks for the info. And good advice on the beneficiary. Will do this in the morning.

robin61

tigerspill wrote: »

Hi,
Very useful summary. Just a couple of things -
1) Have you had any formal communication on the changes to the actuarial reductions. I heard 3% and 3.5% for Sections B & C respectively, but have not seen any official or formal document detailing this. I would like to see that before adjusting what I am planning.
2) Again, have you seen the details on this?

I totally agree with your last point - it has certainly changed what I am planning - if I can see the details documented somewhere.
If you have seen some of this could I ask you to point me in the right direction?

On Friday I did tweak my %age for the new BTRSS so I get the maximum "matching" level. I also put some into the new SAC - which can ultimately be moved to AVCs and get the resulting tax benefit. Didn't put much in yet until I can actually see the money on the Std. Life portal (from July's pay so hopefully will see in August).
Thanks

Regardin my point 2. Just to clarify. It looks like % difference between the standard and semi index linked is the same. It's just that the actual difference is greater because both have lower reduction rates applied and are therefore higher.