NHS 1995 Scheme & Impact of Change To 2015 Scheme in Aug 2021

TojoRalph

Hoping that someone understands the NHS 1995 Scheme and upcoming changes that will Impact the Mrs who is due to move to the NHS 2015 scheme in August this year. Unfortunately there is no NHS helpline and her query submitted today advised a reply may take up to 6 weeks.
The 1995 Scheme appears to have a “standard” retirement age of 60 (for her that’s Aug 2022), which is when she has always been planning to retire. However, in Aug 2021 she will be moved to the 2015 scheme that has a standard retirement date of 65.
Am I right in saying that what in effect happens is in Aug 2021 is the 1995 scheme will cease accruing benefits and the 2015 scheme will begin? Then come Aug 2021 when she reaches 60 she can take her 1995 scheme pension and then five years on there will be a tiny 2015 scheme pension as a result of working Aug 2020 to Aug 2021?
she is looking out paperwork but her concern is that in Aug 2021 all accruals over the years flip to the 2015 scheme and she cannot claim any of her pension until aged 65. Thanks in advance and congratulations for reading this far. 👍 

TojoRalph

As I don't appear to be able to edit .... "Then come Aug 2022 when she reaches 60 she can take her 1995 scheme pension and then five years on there will be a tiny 2015 scheme pension as a result of working Aug 2021 to Aug 2022?"

hugheskevi

The main thing you should start with it reading about the McCloud judgment and how it affects the NHS pension scheme.

The 1995 Scheme appears to have a “standard” retirement age of 60 (for her that’s Aug 2022), which is when she has always been planning to retire. However, in Aug 2021 she will be moved to the 2015 scheme that has a standard retirement date of 65.

The normal pension age of the 2015 scheme is the individual's state pension age. That is age 67 for your wife.

Am I right in saying that what in effect happens is in Aug 2021 is the 1995 scheme will cease accruing benefits and the 2015 scheme will begin? Then come Aug 2022 when she reaches 60 she can take her 1995 scheme pension and then five years on there will be a tiny 2015 scheme pension as a result of working Aug 2021 to Aug 2022?

She will cease accruing reckonable service in the 1995 scheme, but the link to final salary will continue (ie it her salary at date of leaving that determines benefits in the scheme, despite having moved to 1995 scheme.

However, although she will switch schemes, the McCloud judgment means she will be offered a choice in due course of being in the 1995 or 2015 scheme for service between 2015 and 1 April 2022.

From 1 April 2022 her service will just be under the 2015 scheme.

Although the normal pension age of the 2015 scheme is 67 for your wife, it can be taken early with actuarial reduction.

she is looking out paperwork but her concern is that in Aug 2021 all accruals over the years flip to the 2015 scheme and she cannot claim any of her pension until aged 65.

That is not what happens - her pension will be calculated as you outlined in your post.

Dazed_and_C0nfused

What she accrued under the 1995 scheme should be paid under those rules.

What she accrued under the 2015 will be paid under those rules.  One of which I think is that pension age is her State Pension age, not fixed at 65.

ggmf

I read  yesterday that the Government MAY be making an announcement this week on outcomes from the ‘McCloud’ consultation. I hope so as I have3 pensions, 1995, 2008 and 2015, but I'm not holding my breath

TojoRalph

hugheskevi said:

The main thing you should start with it reading about the McCloud judgment and how it affects the NHS pension scheme.

The 1995 Scheme appears to have a “standard” retirement age of 60 (for her that’s Aug 2022), which is when she has always been planning to retire. However, in Aug 2021 she will be moved to the 2015 scheme that has a standard retirement date of 65.

The normal pension age of the 2015 scheme is the individual's state pension age. That is age 67 for your wife.

Am I right in saying that what in effect happens is in Aug 2021 is the 1995 scheme will cease accruing benefits and the 2015 scheme will begin? Then come Aug 2022 when she reaches 60 she can take her 1995 scheme pension and then five years on there will be a tiny 2015 scheme pension as a result of working Aug 2021 to Aug 2022?

She will cease accruing reckonable service in the 1995 scheme, but the link to final salary will continue (ie it her salary at date of leaving that determines benefits in the scheme, despite having moved to 1995 scheme.

However, although she will switch schemes, the McCloud judgment means she will be offered a choice in due course of being in the 1995 or 2015 scheme for service between 2015 and 1 April 2022.

From 1 April 2022 her service will just be under the 2015 scheme.

Although the normal pension age of the 2015 scheme is 67 for your wife, it can be taken early with actuarial reduction.

she is looking out paperwork but her concern is that in Aug 2021 all accruals over the years flip to the 2015 scheme and she cannot claim any of her pension until aged 65.

That is not what happens - her pension will be calculated as you outlined in your post.

Thanks for the feedback and I will do some reading. Since posting the Mrs has logged into the SPPA website and we have had a look at the 2019 and 2020 statements (statements date back to 2016). First off, her date of joining the NHS was June 2004, in the event that tells you anything. On the statement it shows the estimate of final salary benefits is based on NPA 60 and there are only ONE set of figures. Also, it's safe to say that the Mrs will have paid zero attention to any communications on the subject over the years, thus if she was required to do anything, we can safely assume she did nothing. All of that appears to indicate she has everything in the 1995 scheme? I could find nothing in the statement to clarify if the scheme is 1995, 2008 or otherwise.
I guess that raises the question, should she have done something or has doing nothing paid dividends?
Anyway we need to read up as I want to see if the scheme has to have a survivor pension element, ideally not if it means she can have more to herself. Thanks again. 🙂

spaniel101

https://www.nhsbsa.nhs.uk/sites/default/files/2019-03/1995-2008 Members Guide (V22) 02.2019.pdf
https://www.nhsbsa.nhs.uk/member-hub

saucer

ggmf said:

I read  yesterday that the Government MAY be making an announcement this week on outcomes from the ‘McCloud’ consultation. I hope so as I have3 pensions, 1995, 2008 and 2015, but I'm not holding my breath

I have membership in both the 1995 and 2015 parts of the scheme. My intention is to retire before the retirement ages for both parts (of 67 for me in the 2015 scheme, and 60 in the 1995). When I ran the numbers the potential implications of the McCloud judgement made little difference. The reason for this is that, although there is a much bigger penalty for me retiring early in the new 2015 scheme (given the later normal retirement age...more years of penalty), the rate at which the pension accumulates is more generous. There is a larger sum from which any actuarial penalty is paid. 

Whether this will be the same for you will depend on a number of factors including 1. How your pay has changed over the years, and 2. What point you intend to retire (how long before the NRA). 

Also bear in mind that you can take any 1995 pension at 60 and then wait to take the other parts when they are due, without reduction.

JoeCrystal

Here is the link to the consultation outcome response published today. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/958189/20210129_PRP_consultation_response_final.pdf

Link to the webpage containing the rest of the information:

https://www.gov.uk/government/consultations/public-service-pension-schemes-consultation-changes-to-the-transitional-arrangements-to-the-2015-schemes

Happy reading!

saucer

JoeCrystal said:

Here is the link to the consultation outcome response published today. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/958189/20210129_PRP_consultation_response_final.pdf

Link to the webpage containing the rest of the information:

https://www.gov.uk/government/consultations/public-service-pension-schemes-consultation-changes-to-the-transitional-arrangements-to-the-2015-schemes

Happy reading!

Thanks for posting. I’ve eyeballed it. The big take-home message that applies to most people affected is that any decision regarding whether you want benefits from 2015-2022 to accrue under the legacy scheme rules, or new CARE scheme rules, will be deferred until later i.e. retirement. That means the best of both worlds in that a member can see which is best for their retirement income and choose accordingly. There is lots of other info regarding specific circumstances e.g. what happens regarding divorce, death in service, people who have retired since 2015 etc. 

ggmf

saucer said:

ggmf said:

I read  yesterday that the Government MAY be making an announcement this week on outcomes from the ‘McCloud’ consultation. I hope so as I have3 pensions, 1995, 2008 and 2015, but I'm not holding my breath

I have membership in both the 1995 and 2015 parts of the scheme. My intention is to retire before the retirement ages for both parts (of 67 for me in the 2015 scheme, and 60 in the 1995). When I ran the numbers the potential implications of the McCloud judgement made little difference. The reason for this is that, although there is a much bigger penalty for me retiring early in the new 2015 scheme (given the later normal retirement age...more years of penalty), the rate at which the pension accumulates is more generous. There is a larger sum from which any actuarial penalty is paid. 

Whether this will be the same for you will depend on a number of factors including 1. How your pay has changed over the years, and 2. What point you intend to retire (how long before the NRA). 

Also bear in mind that you can take any 1995 pension at 60 and then wait to take the other parts when they are due, without reduction.

Thanks, I'm 63, my 1995 is in payment, my 2008 was split due to the changes, hence I have the 2008 and 2015 (confirmed by the 2019-2020 TRS). The 2008 will be due at age 65, the 2015 element at NRA which for me will be 66. At present I would like them to merge the 2008 and 2015 back together, with a due age of 65.