Civil Service Classic Pension queries

Dazed_and_C0nfused

hyubh said:

Dazed_and_C0nfused said:

hyubh said:

kjs31 said:

Another thing I noticed when I read the T&Cs is that there is an annual increase to the deferred pension in April each year, so I will get an annual increase to my deferred pension in April this year and then my pension starts to pay in December 2024. When it comes to the increase in April 2025 I only get a percentage of the increase as the pension has only been physically paying for 3 months. So I won’t get any increase for the period between April and December when it was still deferred? Surely I can’t be disadvantaged by being born later in the tax year? 🤷🏻‍♀️

No, this is not correct. Public sector pensions 'revalue' in deferment by applying pension increases (most private sector DB pensions, in contrast, have a distinct revaluation calculation). So the first, pro-rated increase is for the first part year after leaving, not the first part year after retiring.

I get what the op is saying though, they have been a deferred member for many years so have been receiving the full annual revaluation for a long time.  This would have added 10.1% in April 2023 and a further 6.7% in April 2024.

For simplicity say September 2024's CPI figure is 6.0% and the pension is put into payment at NPA in December 2024.

They will get 1.5% increase in April 2025 but appear to be missing out on the remaining 4.5%.

If the revalued pension at April 2024 was exactly £10,000 then from April 2025 won't the pension be just £10,150?

You've lost me I'm afraid. Why would the OP only get a 1.5% increase in April 2025 if the September 2024 CPI figure were 6%...?

Because the pension commenced payment 3/4 of the way through the year (6.0% x 3/12= 1.5%).

This extract from civil service pension website refers.

Pensions increase

Pensions in payment increase every year in line with the cost of living. All pensioners aged 55 or over get these increases. Preserved benefits are also increased to maintain their value up to the date they become payable.

You will also receive the cost-of-living increases if you are aged under 55 and if:

you retired because of ill health; or if

the pension is paid to a widow, widower or surviving civil partner; or if

the pension is paid for a child.

Example:

You retire in mid-October with an annual pension of £7,500.

The following April, the cost-of-living increase is 3.5%.

As you retired exactly halfway through the relevant 12-month period, the pension is increased proportionately (that is, by one half of the total increase – 1.75%).

During the second year, the cost of living increase is 4.2%. Your annual pension becomes £7,631.25 after six months and £7,951.76 a year later.

https://www.civilservicepensionscheme.org.uk/knowledge-centre/pension-schemes/classic-scheme-guide/retirement/

Silvertabby

This is for someone who retired from active service in mid October, hence the pro-rata increase.

In the case of someone drawing their benefits from deferred status, the following April's increase would be the full 3.5% as the pension increases are applied in both deferment and payment.

hyubh

Dazed_and_C0nfused said:

hyubh said:

Dazed_and_C0nfused said:

hyubh said:

kjs31 said:

Another thing I noticed when I read the T&Cs is that there is an annual increase to the deferred pension in April each year, so I will get an annual increase to my deferred pension in April this year and then my pension starts to pay in December 2024. When it comes to the increase in April 2025 I only get a percentage of the increase as the pension has only been physically paying for 3 months. So I won’t get any increase for the period between April and December when it was still deferred? Surely I can’t be disadvantaged by being born later in the tax year? 🤷🏻‍♀️

No, this is not correct. Public sector pensions 'revalue' in deferment by applying pension increases (most private sector DB pensions, in contrast, have a distinct revaluation calculation). So the first, pro-rated increase is for the first part year after leaving, not the first part year after retiring.

I get what the op is saying though, they have been a deferred member for many years so have been receiving the full annual revaluation for a long time.  This would have added 10.1% in April 2023 and a further 6.7% in April 2024.

For simplicity say September 2024's CPI figure is 6.0% and the pension is put into payment at NPA in December 2024.

They will get 1.5% increase in April 2025 but appear to be missing out on the remaining 4.5%.

If the revalued pension at April 2024 was exactly £10,000 then from April 2025 won't the pension be just £10,150?

You've lost me I'm afraid. Why would the OP only get a 1.5% increase in April 2025 if the September 2024 CPI figure were 6%...?

Because the pension commenced payment 3/4 of the way through the year (6.0% x 3/12= 1.5%).

I'm still lost - how is this relevant for the OP, who's been deferred for many years...?

The fundamental thing is that pension increases for the PCSPS and other public service pensions start from leaving (or potentially earlier, given scheme-specific protected final pay provisions), not retirement. There's no second pro-rata on retirement if you've been in deferment for 12 months or more.

Dazed_and_C0nfused

Silvertabby said:

This is for someone who retired from active service in mid October, hence the pro-rata increase.

In the case of someone drawing their benefits from deferred status, the following April's increase would be the full 3.5% as the pension increases are applied in both deferment and payment.

Thanks, can see where I've been going wrong 😕

Dazed_and_C0nfused

hyubh said:

Dazed_and_C0nfused said:

hyubh said:

Dazed_and_C0nfused said:

hyubh said:

kjs31 said:

Another thing I noticed when I read the T&Cs is that there is an annual increase to the deferred pension in April each year, so I will get an annual increase to my deferred pension in April this year and then my pension starts to pay in December 2024. When it comes to the increase in April 2025 I only get a percentage of the increase as the pension has only been physically paying for 3 months. So I won’t get any increase for the period between April and December when it was still deferred? Surely I can’t be disadvantaged by being born later in the tax year? 🤷🏻‍♀️

No, this is not correct. Public sector pensions 'revalue' in deferment by applying pension increases (most private sector DB pensions, in contrast, have a distinct revaluation calculation). So the first, pro-rated increase is for the first part year after leaving, not the first part year after retiring.

I get what the op is saying though, they have been a deferred member for many years so have been receiving the full annual revaluation for a long time.  This would have added 10.1% in April 2023 and a further 6.7% in April 2024.

For simplicity say September 2024's CPI figure is 6.0% and the pension is put into payment at NPA in December 2024.

They will get 1.5% increase in April 2025 but appear to be missing out on the remaining 4.5%.

If the revalued pension at April 2024 was exactly £10,000 then from April 2025 won't the pension be just £10,150?

You've lost me I'm afraid. Why would the OP only get a 1.5% increase in April 2025 if the September 2024 CPI figure were 6%...?

Because the pension commenced payment 3/4 of the way through the year (6.0% x 3/12= 1.5%).

I'm still lost - how is this relevant for the OP, who's been deferred for many years...?

The fundamental thing is that pension increases for the PCSPS and other public service pensions start from leaving (or potentially earlier, given scheme-specific protected final pay provisions), not retirement. There's no second pro-rata on retirement if you've been in deferment for 12 months or more.

Think I've got it now 🤞

bluelad1927

@kjs3 please can I ask what app you got that screenshot from. I am in a similar position with a frozen Classic pension. I did get a paper statement off CSP which took about 3 months to arrive. 

It would be good to be able to log in and see it as frozen Classics previously weren't available to view on MyCSP.

Thanks

kjs31

Silvertabby said:

This is for someone who retired from active service in mid October, hence the pro-rata increase.

In the case of someone drawing their benefits from deferred status, the following April's increase would be the full 3.5% as the pension increases are applied in both deferment and payment.

Is that documented anywhere please? I could only see the details posted by @Dazed_and_C0nfused  

Is it maybe this sentence that applies for a deferred member? It’s not very clear IMO though and should make the distinction between active and deferred members. 

Preserved benefits are also increased to maintain their value up to the date they become payable.

GunJack

bluelad1927 said:

@kjs3 please can I ask what app you got that screenshot from. I am in a similar position with a frozen Classic pension. I did get a paper statement off CSP which took about 3 months to arrive. 

It would be good to be able to log in and see it as frozen Classics previously weren't available to view on MyCSP.

Thanks

You don't need an app, just go to the civilservicepensionscheme.org website and register for an account, follow the links for deferred members, and it's there. I've done it myself and it's only been available recently. Once you get to the home page, click More (next to logout box) and deferred benefits is one of the links in that section. 

kjs31

Here are the notes from my account in relation to the deferred benefits. It’s still not clear to me when they apply the increase for next April. 

Your benefits will continue to increase in line with changes in prices (i.e. inflation) up to your Normal Pension Age.

The preserved benefits shown is the value of your pension or lump sum on the date you left the Civil Service Pension scheme.

The revalued benefits shown is the current value of your pension or lump sum as at today’s date, including any pension increase that is applicable (pension increases are applied in April each year).

kjs31

bluelad1927 said:

@kjs3 please can I ask what app you got that screenshot from. I am in a similar position with a frozen Classic pension. I did get a paper statement off CSP which took about 3 months to arrive. 

It would be good to be able to log in and see it as frozen Classics previously weren't available to view on MyCSP.

Thanks

You need to register and log on here. Don’t bother with the app as it’s a waste of space if you have a deferred pension. 

https://www.civilservicepensionscheme.org.uk/