updates on FBU, Civil service pensions

Dalemar

Hello all.

I've been following this thread with interest. From 2009 to 2015, I was in nuvos before being transferred to Alpha, which I am still contributing to., It seems now as a result of the McCloud judgement that I will be transferred back into nuvos for my post 2015 service or receive equivalent benefits.

This appears relatively straightforward as the only differences are a 65 NRA and a 2.3% accrual in nuvos against 2.32% i accrual in Alpha and NRA of state pension age (currently 67 for me). Does everyone agree that the decision to move back into nuvos is therefore a no-brainer?

Also I made two-years of EPA -2 payments, does anyone know how these will be treated? Will I get a refund for example, or will the EPA payments be converted to added pension?

I suspect no one knows at this point, but I would be interested in your thoughts.

hugheskevi

This appears relatively straightforward as the only differences are a 65 NRA and a 2.3% accrual in nuvos against 2.32% i accrual in Alpha and NRA of state pension age (currently 67 for me). Does everyone agree that the decision to move back into nuvos is therefore a no-brainer?

If you were to experience severe ill-health, your pension under alpha would be higher (as it would be enhanced to age 67 rather than aged 65, and put into payment immediately).

If you were to die, the survivor pension under alpha could be higher than under nuvos, again because it could be based on service enhanced to a later age and paid immediately.

But aside from some specific circumstances what you say is accurate - except that you do not currently have any decision to take, and how (and when) any decisions members have to take will be determined by HM Treasury and schemes in due course.

Also I made two-years of EPA -2 payments, does anyone know how these will be treated? Will I get a refund for example, or will the EPA payments be converted to added pension?

Details such as this are not yet available, and will probably only be known when schemes publish draft rule amendments in due course.

MrsBrooks13

Some very thought provoking and good advice here so thank you all for educating me.

I am particularly interested in the impact any reversion to a former scheme (in my case Classic) could have on a potential ill-health application. I have 19 years banked reckonable service in Classic and 4 years in Alpha. My SPA is 67. I have suffered several years of ill health and potential ERDIH has recently been mentioned by management if my condition and attendance don’t improve soon. I don’t know whether to initiate an application now (currently on sick leave) or wait until management force the issue, by which time the outcome of the McCloud remedy may be available. My limited understanding of my pension situation is:-

If I had remained on Classic, I would need to be deemed incapable of performing my current or an equivalent job. My NPA would have been 60 at which point I would receive my pension plus a lump sum of 3x pension. As my reckonable service is less than 20 years, I understand my pension would be enhanced to five years over my NPA I.e 65.

On Alpha, I have to be deemed incapable of undertaking my current or similar job to receive a lower tier pension or unfit for any job for higher tier. I understand higher tier is very difficult to achieve and I doubt I would satisfy the stringent criteria. My NPA and SPA are 67. I don’t believe I would therefore benefit in the way hugheskevi explained previously.

Am I correct in thinking that a hypothetical/possible reversion to a Classic Pension would be advantageous to me in that a) there is only one tier to satisfy I.e. incapable of doing your current job or similar and b) i would receive enhancement of my pension to 65 years, plus have the benefit of a lump sum of 3x pension?

Or am missing something here?

Many thanks in anticipation of any advice/suggestions.

poorchester

If you revert to Classic you will get a maximum of 6 and 2/3 years enhancement up to NPA under ill health retirement.
So if you are, for example, 50 you will get an additional 6 and 2/3 years enhancement. If you are 56 you will get 4 years extra. If you are over 60 there is no enhancement.

https://www.civilservicepensionscheme.org.uk/media/95257/pbihr_web-20150714.pdf

Trying_to_be_good

I’m in a similar position but was I’ll enough to be ‘awarded’ ill-health retirement in 2017 - 20 years in Classic plus buying added years plus 2.5 years in alpha, including voluntarily paying full contributions whilst on half and nil pay.

The 6 years 8 months uplift on Classic IHR also means additional lump sum.

I’m wondering if it will be that straightforward.

Ill-health (and survivor) benefits are also part of the calculation for anyone assuming they’re going to work through to their chosen/set retirement age.

MrsBrooks13

Thanks for your replies. As a part-timer for most of my service, I have 19 years reckonable service and am aged 49. The Classic guide refers to two methods of calculating an enhancement, and the one you suggest is Method B. I had worked on the basis of Method A!

Method A
Your reckonable service is increased to 20 years, or, if it is less, to the amount you would have built up if you had worked until five years after pension age.
Method B
Your reckonable service is increased by 6 2/3 years, or, if it is less, to the amount you would have built up by pension age.

So have I misinterpreted Method A? sorry but part of my conditions causes brain fog!

poorchester

Method A only gives you a maximum of 20 years.

JCUK

Useful update from the FBU today:

https://www.fbu.org.uk/circular/2019hoc0658mw/pensions-age-discrimination-claims-remedies-hearing-18-december

nigelbb

JCUK wrote: »

Useful update from the FBU today:

https://www.fbu.org.uk/circular/2019hoc0658mw/pensions-age-discrimination-claims-remedies-hearing-18-december

It looks like they get to choose whichever pension scheme gives the higher pension.

The wording is likely to be agreed. It would say that all members who did not satisfy the age-based requirements for full protection (i.e. they were too young) are entitled to be treated as if they did satisfy them. That would mean that all members of the 1992 Scheme or the 2006 Scheme who were in service on 31 March 2012 would be entitled to be treated as if they had never left.

Note that the wording is “entitled to be treated …” not “must be treated …”. Our lawyers have carefully analysed the differences between the three schemes. In almost all circumstances a member who has a choice between the 1992 Scheme and the 2015 Scheme will be better off on 1992 Scheme terms. That is not necessarily the case for a member who has a choice between the 2006 Scheme and the 2015 Scheme – in some circumstances they would be better off if they are treated as if they are a member of the 2015 Scheme. The Government accepts that no-one should be worse off as a consequence of unravelling the 2015 changes.

The important point is that, provided that you were employed before 1 April 2012, if you were in the 1992 Scheme you would be back in the 1992 Scheme. If you were in the 2006 Scheme you would be back in the 2006 Scheme, provided that it is a better pension scheme for you.

m_c_s

(c) Contributions

The contributions that members of the 1992 Scheme pay are higher than the contributions paid by 2015 Scheme members. That is because it is a better pension scheme. But if members are put back in the 1992 Scheme, one side effect will be that they have to pay the higher contribution rate, and pay the arrears going back to 1 April 2015.

We will negotiate the terms for payment of arrears. They should not have to be paid as a single lump sum, but 1992 Scheme members should start budgeting and planning for this now.

That must be unique to the FB pension? For most other Public Sector pensions I assume the increased contributions from 2012 mean no immediate direct financial hit although obviously long term will be a financial benefit
Seems we will have to wait for Civil Service pensions to be resolved to know how we will be impacted.