Civil Service Classic/Alpha Actuarial Reduction tables

kassy64

chubsta said:

Hi, yes I was, and still am, a shift worker, and any absolutely minimal pay-rises we got were completely taken out by drops in allowances, although our shifts never changed! Looking at my figures, due to the large increase in CPI over the last two years it has increased my Classic to the point that my Alpha is effectively a 'free' pension, and as I was not interested in promotion it was a very good decision to have made. I am lucky in being part of the Golden generation who were in Classic long enough to get a decent pension and lump sum put aside when the switch happened in 2015.

I am dreading dealing with MyCSP but I do have full records of everything going back to 2009, spreadsheets showing what I should be getting according to CPI uplift expected next April, as well as actuarial reductions figures, hence my interest in making sure they are up-to-date.

Knowledge is power and having seen many of my colleagues have problems but also absolutely no idea of what they should be getting has really focussed my mind.

I put my retirement request through in early April last year, to retire at the end of August (so 5 months). I actually retired without knowing what I would be receiving and finally got everything sorted in the October. As I said earlier the deferred Classic element confused MyCSP a lot and they actually tried to give me my 1982-2015 service pension twice. Luckily its all ok now and once sorted there's very little to worry about afterwards. Because of the deferred element I effectively receive 3 x pensions - Classic 1982-2015 (28 day gap) Classic 2015-2017 (under tapering rules I was allowed to extend) and then Alpha 2017-2022. Although it all gets paid as a single payment. 
Plus, we all have the McLeod (?) ruling to change everything maybe later this year, although I'm not expecting to hear anything before 2024 at the earliest.
ps - from my basic calculations for me it wont make a massive difference but will wait to see what the offer is. 

westv

Sort of connected to CS pensions, does anybody know when the latest CS salary increase will be agreed/implemented?

sammyjammy

westv said:

Sort of connected to CS pensions, does anybody know when the latest CS salary increase will be agreed/implemented?

Depends on individual departments.

r6mile

I am in DSIT and had been hoping August but not likely. In any case it will get backdated to August - however does anyone know how this impacts which Pension contribution band you are in for that month? I am on the upper end of the 5.45% band, so wonder if a backdated payment will push me to the 7.35% band for that month.

hugheskevi

r6mile said:

I am in DSIT and had been hoping August but not likely. In any case it will get backdated to August - however does anyone know how this impacts which Pension contribution band you are in for that month? I am on the upper end of the 5.45% band, so wonder if a backdated payment will push me to the 7.35% band for that month.

It was changed a few years ago so that backdated pay does not count when determining pension contribution threshold.

See para 2.7 at this link.

Miser1964

IMHO anyone in the age-group transitioned/tapered onto Alpha will likely be better off electing to roll-back onto Classic/Classic Plus once the McLeod judgement details come out.

chubsta

Miser1964 said:

IMHO anyone in the age-group transitioned/tapered onto Alpha will likely be better off electing to roll-back onto Classic/Classic Plus once the McLeod judgement details come out.

Not necessarily - in my case I am thousands of pounds better off by keeping my Classic as-was and being on Alpha since 2015. 
The important thing is doing the maths and understanding everything, I have seen too many people have literally no idea of what their pensions will be.

Lyncroft

On a rough calculation I reckon there wasn't much in it for me. Quite glad as the thought of MYCSP processing  historic adjustments doesn't take my fancy. Hopefully, they'll have everything sorted out though. Alpha gets a lot of criticism, but I think it's a decent scheme.

hugheskevi

chubsta said:

Miser1964 said:

IMHO anyone in the age-group transitioned/tapered onto Alpha will likely be better off electing to roll-back onto Classic/Classic Plus once the McLeod judgement details come out.

Not necessarily - in my case I am thousands of pounds better off by keeping my Classic as-was and being on Alpha since 2015. 
The important thing is doing the maths and understanding everything, I have seen too many people have literally no idea of what their pensions will be.

Very much agree.

Usually there is little difference between outcomes under alpha and classic and things like whether a member would take a lump sum from alpha at 12:1 commutation can be significant in determining which is better. For a member who wishes to maximize value (ie no lump sum beyond the automatic classic lump sum), alpha usually will slightly beat classic. But I suspect many will want to match the lump sum they got from classic in their alpha option, in which case classic may well be better than alpha.

Premium and Classic Plus members will usually be better off in the legacy schemes, particularly with the recent high inflation and the superior inflation protection those schemes offer to active members. 

Nuvos members will almost all be better off under nuvos then alpha, unless ill health is relevant or they reached State Pension age before it increased beyond 65.

But as you say, many members will be blissfully unaware of these sort of details so hopefully the options literature will make the comparison simple. However, even then I think members will make poor decisions around the value of annual pension compared to lump sums.

kassy64

I'm just hoping that when the final 'options' packs start dropping through our letterboxes it will be a fairly simple process to make the correct call. From my own calculations I'm not expecting a significant +/- difference between the two. As previously stated Alpha is a decent pension as long as you keep up your career earnings  (which for those who work shifts and attract a large portion of their salary through pensionable allowances then if ever they lose those or they keep getting cut back by Government it will obviously be reflected in their Alpha pension).