SERPS

darcybrown

In 1978 to 1988 I was contracted out of serps to my private pension at the company i worked for, when I was made redundant.  Would I have continued to be contracted out when I started a new job with no private pension when I left in 1998 or would I have been contracted back in due to my pension now ending with that company.
I am asking this as I started work in 1966 and worked until I was 65 -my state pension is lower than it should be, but they are confusing me with loads of jargon. I have also sent them a letter requesting a breakdown of my state pension and they are still fobbing me off, the letter was sent in feb 2021 and I ring every 12 weeks and there is still no joy, but when I sent for my husbands breakdown it was with me in 12 weeks.  Don't know what is going on,  I took my state pension in when I was just a new months over 60 due to being born in 1951.   Its so frustrating that I cannot get a strait answer.   Can anyone help,  it seems to be a minefield    Thank you

xylophone

Do you still have your first letter showing your entitlement to SP (sometime around 2011?)?

Do you have your latest letter (you'd probably have received it in March)?

Would you be willing to post up, (all identifying information removed)?

Are you in receipt of a pension from the contracted out scheme?

molerat

darcybrown said:

my state pension is lower than it should be

Compared to what ?

If you are only receiving the basic pre 2016 pension then you could be correctly receiving only £141.85 compared to the current new pension of £185.15 but there is nothing inherently wrong with that.

As above, if you are happy to post exactly what you are receiving someone will try to figure an explanation of how that figure could have been arrived at.

Every year your pension award letter should show the exact make up components of what you receive.

dunstonh

 Would I have continued to be contracted out when I started a new job with no private pension when I left in 1998 or would I have been contracted back in due to my pension now ending with that company.

You would have been contracted back in with the new employer.  

I am asking this as I started work in 1966 and worked until I was 65 -my state pension is lower than it should be, but they are confusing me with loads of jargon.

How is it lower?    Based on limited information, you would have built up basic state pension entitlement only until 1988 and then some SERPs/S2P entitlement from 1988-1998.     You would probably expect to be somewhere between the basic state pension figure and the new single state pension.

Albermarle

xylophone said:

Do you still have your first letter showing your entitlement to SP (sometime around 2011?)?

Do you have your latest letter (you'd probably have received it in March)?

Would you be willing to post up, (all identifying information removed)?

Are you in receipt of a pension from the contracted out scheme?

Alternatively is there a separate pension pot from the contracted out scheme that you have not accessed yet ?

Marcon

dunstonh said:

 Would I have continued to be contracted out when I started a new job with no private pension when I left in 1998 or would I have been contracted back in due to my pension now ending with that company.

You would have been contracted back in with the new employer.  

...but from 1988, you could have used a personal pension to contract out of SERPS - often on something called a 'rebate only' basis. This means you paid full NI, but part of it was paid over ('rebated') direct to the pension provider, assuming you set up such a pension. Very many people did - and then forgot about it!

If you get a really detailed breakdown of your NI history paid during your whole career, that seems the best way to be sure. Try this: https://www.tax.service.gov.uk/shortforms/form/DPU_SAR_NI?_ga=2.230026460.1544670040.1621021753-1315656139.1609178084

dunstonh

...but from 1988, you could have used a personal pension to contract out of SERPS - often on something called a 'rebate only' basis. This means you paid full NI, but part of it was paid over ('rebated') direct to the pension provider, assuming you set up such a pension. Very many people did - and then forgot about it!

But the OP says they were contracted out before 1988, indicating an occupational pension.  Contacting out on an individual basis didn't start until 1988.  So, they couldn't have been on an individual plan (or group plan) prior to 1988.  Contracting out with an occupational pension was possible before 1988

So, contracting out on an occupational pension would end at the point of employment.     As there was no occupational pension with the new employer, it would be contracted in unless the OP used a personal pension for contracting out but nothing in the message says they did.   (as it was 1988 with the new job, that would have been possible)

Marcon

dunstonh said:

...but from 1988, you could have used a personal pension to contract out of SERPS - often on something called a 'rebate only' basis. This means you paid full NI, but part of it was paid over ('rebated') direct to the pension provider, assuming you set up such a pension. Very many people did - and then forgot about it!

But the OP says they were contracted out before 1988, indicating an occupational pension.  Contacting out on an individual basis didn't start until 1988.  So, they couldn't have been on an individual plan (or group plan) prior to 1988.  Contracting out with an occupational pension was possible before 1988

So, contracting out on an occupational pension would end at the point of employment.     As there was no occupational pension with the new employer, it would be contracted in unless the OP used a personal pension for contracting out but nothing in the message says they did.   (as it was 1988 with the new job, that would have been possible)

Your comment that OP would have been contracted in with their new employer overlooked the further possibility that they might have contracted out via an Appropriate Personal Pension. I was making the point OP could have had both -  people posting here won't necessarily realise things may not be as simple as one particular answer suggests. 

As you can see, my answer indicated contracting out on an individual basis became possible from 1988. A full NI history would show both pre and post 1988 positions, and thus clarify the situation.

xylophone

In 1978 to 1988 I was contracted out of serps to my private pension at the company i worked for, when I was made redundant.  Would I have continued to be contracted out when I started a new job with no private pension when I left in 1998 or would I have been contracted back in due to my pension now ending with that company.
I am asking this as I started work in 1966 and worked until I was 65 -my state pension is lower than it should be, but they are confusing me with loads of jargon. 

From the context, I am assuming that the reference to 1998 was a typo.

It is unclear what has prompted the OP to start querying the  amount of her SP now, more than ten years after she started to receive it.

She mentions that she was born in 1951,  and started  work in 1966. 

It is likely that  in addition to Basic State Pension she built up some Graduated Retirement Benefit  (up to 1975) and if so this should show on her state pension statement.

In 1978, the State Earnings Related Pension Scheme was introduced - the OP's occupational pension scheme chose to contract out so that the OP earned no SERPS - instead she accrued a pension within the scheme (which by law would have to have been at least as high as she would have accrued had the scheme been contracted in).

This is the Guaranteed Minimum Pension - it is likely to be represented on her state pension statement by a Contracted Out Deduction.

The OP appears to be indicating (implying) that after being made redundant in 1988, she found other employment and  that after this point and up to reaching SPA in 2011, (although making (or being credited with)  NI contributions, was never again in a contracted out scheme.

She mentions working up to age 65 (to 2016?) but would not have paid NI after SPA.

If the above is the case, then one would expect her latest SP statement to show a full basic state pension  of £141.85 (because she had at least 30 years NI between 1966 and 2011)

In addition, it should show pre 1997  Additional State Pension (with a Contracted Out Deduction to take out of contracting out 1978 - 1988).

It should show any post 1997 ASP accrued.

It should show any Graduated Retirement Benefit.

It may be that the reason that the OP thinks that her SP is lower than it should be is because the sum of the above is less than a current full NSP and she thinks that she should be entitled to a full NSP.

However, she is reached SPA before the introduction of NSP so comes under the old scheme and her entitlement would be calculated as above.

Her latest SP statement should clarify.

darcybrown

Thank you for your input its appreciated

darcybrown

Thank you everyone it is appreciated.