Teachers Pension Revaluation on Retirement

Silvertabby

FYI.  These are the 2023 figures.  Future years will differ slightly - depends on the actual date the COL increase is applied - but won't be much different.  

Am I entitled to the full increase?
If your pension began on or before 25 April 2022 you are
entitled to receive the full increase. If your pension began
after this date a smaller, prorated increase applies as
shown in the table below:

Pension Begins Increase
On or before 25 April 2022                            10.10%
26 April 2022 to 25 May 2022                         9.26%
26 May 2022 to 25 June 2022                         8.42%
26 June 2022 to 25 July 2022                         7.58%
26 July 2022 to 25 August 2022                      6.73%
26 August 2022 to 25 September 2022           5.89%
26 September 2022 to 25 October 2022          5.05%
26 October 2022 to 25 November 2022           4.21%
26 November 2022 to 25 December 2022       3.37%
26 December 2022 to 25 January 2023           2.53%
26 January 2023 to 25 February 2023             1.68%
26 February 2023 to 25 March 2023                0.84%

Dazed_and_C0nfused

Silvertabby said:

FYI.  These are the 2023 figures.  Future years will differ slightly - depends on the actual date the COL increase is applied - but won't be much different.  

Am I entitled to the full increase?
If your pension began on or before 25 April 2022 you are
entitled to receive the full increase. If your pension began
after this date a smaller, prorated increase applies as
shown in the table below:

Pension Begins Increase
On or before 25 April 2022                            10.10%
26 April 2022 to 25 May 2022                         9.26%
26 May 2022 to 25 June 2022                         8.42%
26 June 2022 to 25 July 2022                         7.58%
26 July 2022 to 25 August 2022                      6.73%
26 August 2022 to 25 September 2022           5.89%
26 September 2022 to 25 October 2022          5.05%
26 October 2022 to 25 November 2022           4.21%
26 November 2022 to 25 December 2022       3.37%
26 December 2022 to 25 January 2023           2.53%
26 January 2023 to 25 February 2023             1.68%
26 February 2023 to 25 March 2023                0.84%

But would something also be added in February 2023 at the point the pension goes into payment?

Silvertabby

Dazed_and_C0nfused said:

Silvertabby said:

FYI.  These are the 2023 figures.  Future years will differ slightly - depends on the actual date the COL increase is applied - but won't be much different.  

Am I entitled to the full increase?
If your pension began on or before 25 April 2022 you are
entitled to receive the full increase. If your pension began
after this date a smaller, prorated increase applies as
shown in the table below:

Pension Begins Increase
On or before 25 April 2022                            10.10%
26 April 2022 to 25 May 2022                         9.26%
26 May 2022 to 25 June 2022                         8.42%
26 June 2022 to 25 July 2022                         7.58%
26 July 2022 to 25 August 2022                      6.73%
26 August 2022 to 25 September 2022           5.89%
26 September 2022 to 25 October 2022          5.05%
26 October 2022 to 25 November 2022           4.21%
26 November 2022 to 25 December 2022       3.37%
26 December 2022 to 25 January 2023           2.53%
26 January 2023 to 25 February 2023             1.68%
26 February 2023 to 25 March 2023                0.84%

But would something also be added in February 2023 at the point the pension goes into payment?

Only if the pension has been brought into payment from deferred.  ie, deferred before 25 April 2022 then 10.10%, etc.

If you mean retiring and taking benefits immediately from Feb 2023 - then that's a bad date to do that, unless there's no other option (ill health, redundancy) as the benefits could also miss out on the CARE 'live'  record revaluation on 1 April.  

Dazed_and_C0nfused

Silvertabby said:

Dazed_and_C0nfused said:

Silvertabby said:

FYI.  These are the 2023 figures.  Future years will differ slightly - depends on the actual date the COL increase is applied - but won't be much different.  

Am I entitled to the full increase?
If your pension began on or before 25 April 2022 you are
entitled to receive the full increase. If your pension began
after this date a smaller, prorated increase applies as
shown in the table below:

Pension Begins Increase
On or before 25 April 2022                            10.10%
26 April 2022 to 25 May 2022                         9.26%
26 May 2022 to 25 June 2022                         8.42%
26 June 2022 to 25 July 2022                         7.58%
26 July 2022 to 25 August 2022                      6.73%
26 August 2022 to 25 September 2022           5.89%
26 September 2022 to 25 October 2022          5.05%
26 October 2022 to 25 November 2022           4.21%
26 November 2022 to 25 December 2022       3.37%
26 December 2022 to 25 January 2023           2.53%
26 January 2023 to 25 February 2023             1.68%
26 February 2023 to 25 March 2023                0.84%

But would something also be added in February 2023 at the point the pension goes into payment?

Only if the pension has been brought into payment from deferred.  ie, deferred before 25 April 2022 then 10.10%, etc.

If you mean retiring and taking benefits immediately from Feb 2023 - then that's a bad date to do that, unless there's no other option (ill health, redundancy) as the benefits could also miss out on the CARE 'live'  record revaluation on 1 April.  

Say it was a deferred pension and had been deferred for several years.

In April 2023 the deferred pension gets the normal 10.1% increase and is then say £10,000.

The September 2023 inflation rate is 5.0% and the pension is taken at normal pension age which is in the period 26 January 2024 to 25 February 2024.       

If I've understood your previous post correctly the increase applied in April 2024 will be 0.83%.  

But will that be applied to £10,000 or will there have been a previous increase when the pension went into payment in the period 26 January 2024 to 25 February 2024?

Silvertabby

Dazed_and_C0nfused said:

Silvertabby said:

Dazed_and_C0nfused said:

Silvertabby said:

FYI.  These are the 2023 figures.  Future years will differ slightly - depends on the actual date the COL increase is applied - but won't be much different.  

Am I entitled to the full increase?
If your pension began on or before 25 April 2022 you are
entitled to receive the full increase. If your pension began
after this date a smaller, prorated increase applies as
shown in the table below:

Pension Begins Increase
On or before 25 April 2022                            10.10%
26 April 2022 to 25 May 2022                         9.26%
26 May 2022 to 25 June 2022                         8.42%
26 June 2022 to 25 July 2022                         7.58%
26 July 2022 to 25 August 2022                      6.73%
26 August 2022 to 25 September 2022           5.89%
26 September 2022 to 25 October 2022          5.05%
26 October 2022 to 25 November 2022           4.21%
26 November 2022 to 25 December 2022       3.37%
26 December 2022 to 25 January 2023           2.53%
26 January 2023 to 25 February 2023             1.68%
26 February 2023 to 25 March 2023                0.84%

But would something also be added in February 2023 at the point the pension goes into payment?

Only if the pension has been brought into payment from deferred.  ie, deferred before 25 April 2022 then 10.10%, etc.

If you mean retiring and taking benefits immediately from Feb 2023 - then that's a bad date to do that, unless there's no other option (ill health, redundancy) as the benefits could also miss out on the CARE 'live'  record revaluation on 1 April.  

Say it was a deferred pension and had been deferred for several years.

In April 2023 the deferred pension gets the normal 10.1% increase and is then say £10,000.

The September 2023 inflation rate is 5.0% and the pension is taken at normal pension age which is in the period 26 January 2024 to 25 February 2024.       

If I've understood your previous post correctly the increase applied in April 2024 will be 0.83%.  

But will that be applied to £10,000 or will there have been a previous increase when the pension went into payment in the period 26 January 2024 to 25 February 2024?

LGPS hat on, but will be very similar for other public sector schemes.

Forget Sep 2023  - yes, public sector CPI increases are determined by the CPI rate at the end of September, but are not brought into practice until the first Monday on or after the following 6 April (10 April this year, 8 April next year)

GMP quirks aside, a pension that has been deferred for many years then brought into payment in Feb 2023 will be at the April 2022 rate.  That will be paid until the 10 April increase applies, when the pension will increase by 10.10%.  The following year the pension will increase by the full 2024 CPI rate. 

Does this pension have an automatic lump sum, or do you intend commuting some of the pension in order to realise tax free cash?  If so, then note that the tax free cash paid in Feb 2023 will be at the 2022 rate and won't increase on 10 April, unless your pension provider offers a 'second bite'.  Not all do, and may not apply in the case of old deferred records.  

Organgrinder

So if i'm reading everything correctly, someone who is in service who retires mid year will get their pension benefits adjusted at the point of retirement, and again in the following April. The two increases will be a proportion of the full year increase, the exact rate dependent on the date of retirement.

hyubh

Silvertabby said:

FYI.  These are the 2023 figures.  Future years will differ slightly - depends on the actual date the COL increase is applied - but won't be much different.  

Am I entitled to the full increase?
If your pension began on or before 25 April 2022 you are
entitled to receive the full increase. If your pension began
after this date a smaller, prorated increase applies as
shown in the table below:

Pension Begins Increase
On or before 25 April 2022                            10.10%
26 April 2022 to 25 May 2022                         9.26%
26 May 2022 to 25 June 2022                         8.42%
26 June 2022 to 25 July 2022                         7.58%
26 July 2022 to 25 August 2022                      6.73%
26 August 2022 to 25 September 2022           5.89%
26 September 2022 to 25 October 2022          5.05%
26 October 2022 to 25 November 2022           4.21%
26 November 2022 to 25 December 2022       3.37%
26 December 2022 to 25 January 2023           2.53%
26 January 2023 to 25 February 2023             1.68%
26 February 2023 to 25 March 2023                0.84%

The OP knows all this. They are asking about the CARE in-service revaluation, not PI.

Silvertabby said:

Dazed_and_C0nfused said:

But would something also be added in February 2023 at the point the pension goes into payment?

Only if the pension has been brought into payment from deferred.  ie, deferred before 25 April 2022 then 10.10%, etc.

If you mean retiring and taking benefits immediately from Feb 2023 - then that's a bad date to do that, unless there's no other option (ill health, redundancy) as the benefits could also miss out on the CARE 'live'  record revaluation on 1 April.  

You seem to be implying there's no CARE in-service revaluation for the final part year. If so, that is wrong, whether for the LGPS or TPS/STPS.

Silvertabby said:

Does this pension have an automatic lump sum, or do you intend commuting some of the pension in order to realise tax free cash?  If so, then note that the tax free cash paid in Feb 2023 will be at the 2022 rate and won't increase on 10 April, unless your pension provider offers a 'second bite'.  Not all do, and may not apply in the case of old deferred records.  

If supplementary PI on a lump sum is payable then it's payable, it's not down to the discretion of the pension administrator.

hyubh

Organgrinder said:

So if i'm reading everything correctly, someone who is in service who retires mid year will get their pension benefits adjusted at the point of retirement, and again in the following April. The two increases will be a proportion of the full year increase, the exact rate dependent on the date of retirement.

Yes, that is correct.

Organgrinder

Fabulous thank you. 

It didn't make any sense to me that someone with exactly the same length service retiring at end August could end up with a significantly different pension to someone retiring at end April following the annual increase the following April. (At today's rates we're talking £600 a year or so on a £20k pension).

Eg if there was no revaluation the teacher who retired in August at today's figure would see a rise to £21,178 whereas the teacher who retired in April would see £21,851. That's quite a difference.

Is the same true for the NPA65 60ths scheme as well as Career Average?

spaniel101

The NPA65 60th is based on Final Salary (the average of your best consecutive 3 years revalued salaries in last 10years of service or last recorded 12 months of pensionable service before your retirement) as 'at date of retirement', then pro-rata CPI increase applied the following April for the remainder of that year since retirement.