COPE reduction issue from SP

Frey_Bentos

Hi Dazed,
My original record showed periods where I was down as being contracted out but knew for certain I wasnt and had wage slips to prove it. My full NI record from HMRC backs up my position and shows only contracted out during the final salary element of working for the NHS, the rest appears to have been corrected.
The pension forecast is pretty short on information, it shows nothing about how much my serps element is, it just shows a final figure and the COPE reduction of 21 quid and says I cannot do anything to improve this figure. I have 39 years NI and plan on working for possibly a few more years. The fact the figure is above the basic state pension amount is irrelevant, it should be higher.
So, worryingly, this new detail of GMP is not anything to do with COPE.
Clear as mud from the HMRC, how on earth is anyone supposed to reconcile their figures when they only give you half the picture.
I wont even start on the fact they have sent me details of my company car that do not bear any resemblance to reality.

xylophone

The pension forecast is pretty short on information, it shows nothing about how much my serps element is, it just shows a final figure and the COPE reduction of 21 quid and says I cannot do anything to improve this figure. I have 39 years NI and plan on working for possibly a few more years. The fact the figure is above the basic state pension amount is irrelevant, it should be higher.
So, worryingly, this new detail of GMP is not anything to do with COPE.

GMP does have something to do with COPE.

Have a look at this, bearing in mind that at 6/4/16, (introduction of NSP), the Basic State Pension was £119.30 and the NSP £155.65.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/210299/single-tier-valuation-contracting-out.pdf

For "rebate derived amount" read COPE.

Daniel54

As per Zylophone's post and mentioned earlier in the thread , your starting amount 6/4/16 was basic state pension plus Serps/S2P.

For this year the basic state pension is £137.6 per week.Taking your figure at the top of this thread ,your state pension forecast therefore  includes £48.16 per week for the earnings related portion from being contracted in.

It is unfortunately common to think that the basic state pension increased overnight to the level of the new state pension..However the transitional arrangements ensured that the higher of the old or new calculations was applied.

molerat

A quick calculation of your entitlement seems to be :

assuming your 39 years is 34 pre 2016 and 5 post

At April 2016 your old scheme pension was £119.30 basic + £42.01 S2P, £161.31, and the new scheme was £151.20 - £21.08, £130.12, so the old scheme won.

As it was already in excess of the new scheme maximum of £155.65 nothing could be added going forward - you got what you had already built up under the old scheme.

You had a relatively healthy S2P and a relatively low COPE figure which confirms your likely contracted out and in periods - to compare my COPE was £74.82 and S2P £17.19 having spent the majority of the time contracted out with the last few years contracted in.

Your problem is  that pension wise time has stood still for you since 2016.

xylophone

With regard to the information in https://forums.moneysavingexpert.com/discussion/comment/78557429/#Comment_78557429

https://techzone.adviserzone.com/anon/public/pensions/Tech-guide-guaranteed-min-pen

 Above  will be worth reading for explanation of S148 Orders.

Looking at the detail of your post above, what was your employment/pension situation between April 2004 and April 2007?

RPA means Responsible Paying Authority.

Frey_Bentos

Xylophone, between april 2004 and 2007 I was working full time, for the same company as in 2003, they were going through the usual company shenanigans though of changing company name, tupe us from one entity to another, all the usual company dodgy stuff to minimise tax and change contracts, I was unaffected by all of it, but did have a supposed gap in my NI class A contributions which was incorrect and the HMRC record appears to have put that right, I have payslips showing i paid class A etc.

Frey_Bentos

Molerat, I think you have hit the nail on the head. I am getting messages in my gov portal that I cannot do anything to improve my SP figure. Does this mean the COPE figure will never change and that despite the fact that im currently paying ££thousands in NI each year until I finish, the COPE figure will never reduce and those contracted out years cannot be replaced by new full years, it seems harsh as im effectively paying NI, at the time of my life when my earnings are at their highest, for nothing.
Everyone else around me family wise is reducing their COPE amount each year by working and paying NI.

molerat

No one is reducing their COPE amount, it cannot be reduced, it is a sum fixed at April 2016 and was only used in the calculation of the starting amount for the new pension.   Post 2016 people are adding to their starting amount, a route only available to those with a starting amount below the full new pension. Once they have reached the full new pension amount then any NI they pay will have no effect on their pension amount.  In my case I was unable to reach the full pension amount as there were insufficient post 2016 years available to make up the gap.

Frey_Bentos

Molerat,
Thank you for your help, youve switched a light on in my knowledge gaps, these rules are fiendishly difficult to interpret, as everyones situation is different.
Ive been trying to compare myself and explain why, for example my sister who is 2 years older than me is currently improving on her SP figure whereas mine is stuck.
My sister has been in a DB scheme for 35 years and has a large COPE figure but is currently working part time to pay her stamp and improve her figures and her SP forecast improves each year yet mine is stuck.

it seems unfair that im putting ££thousands into NI, when I really could do with it being in my PP to help fund my own retirement, not much guaranteed income for me, small ex NHS pension and  just my PP until I hit SP age.
Wont stop me retiring though, im going at age 56 next year, time is my currency.

jamesd

Frey_Bentos said:

Ive been trying to compare myself and explain why, for example my sister who is 2 years older than me is currently improving on her SP figure whereas mine is stuck.
My sister has been in a DB scheme for 35 years and has a large COPE figure but is currently working part time to pay her stamp and improve her figures and her SP forecast improves each year yet mine is stuck.

it seems unfair that im putting ££thousands into NI, when I really could do with it being in my PP to help fund my own retirement, not much guaranteed income for me, small ex NHS pension and  just my PP until I hit SP age.

"My state pension is estimated to be £185.76 a week" The highest single tier state pension under the rules from 2016 and later is £179.60 per week. Anyone with more than that in April 2016 keeps the extra. Nobody with £179.60 a week gets increases in their state pension except the usual inflation or triple lock increases.

Under the old state pension system before April 2016 there was an earnings-related part that increased for each year you worked, no cap, potentially leading to over £300 a week in state pension, with even lifelong low earners expected to be over £200. That was removed for future accrual in the 2016 changes, to increase the single tier state pension to a level higher than the old basic state pension and help those with little or no work history, notably women. The result is a reduction in expected state pension for everyone with a reasonably full working life, including you, as you stop accruing after 35 years and income makes no difference in the new system.

Those with less than £179.60 aren't increasing their state pension by reducing COPE, they are increasing it by 1/35th of the new single tier state pension for each year worked or credited. Any effect on COPE is incidental and irrelevant to their increases because COPE plays no part in them getting the increase.

A high income makes it easier to contribute to private pensions or stocks and shares ISAs and that route is still open to you. Increasing your state pension isn't, except by demonstrating errors in your past contracted in or out history.