Civil Service Pension - Deferred Benefit Preserved versus Revalued McCloud (Edited)

Bravepants

(Edited)

Good morning,

I was please wondering whether anyone else has yet received their deferred benefits statement including McCloud Options?

I have received a Deferred Benefits statement in my online portal now showing the difference between Option A and Option B for the McCloud remedy. 

My preferred Option in my case would be Option B, whereby I accrued Premium Pension from March 2005 until April 2015 and Alpha From April 2015 until February 2024 when I left work. 

I would like to take the Alpha pension early (possibly this year), and it being larger under option B would provide higher benefits early on.

Under Option B on the online portal I have the three entries listed, two for Alpha and one for Premium. I understand I have two entries for Alpha to cover the period from 1 April 2022 (from which point everyone is now in Alpha) to leaving date in 2024, and from 2015 to 2022 separately. 

In each case there are two values for the pension benefits, "preserved" versus "revalued", with no explanation regarding the meaning of the two. The revalued pension amount is LOWER than the preserved pension amount.

Can anyone please shed any light on the difference between the "preserved" and "revalued" values? Which value will I be actually receiving?

Thanks for any advice.

 

moo121

I haven't received my McCloud options yet (although I believe I'm in scope) but on my preserved benefits page on the portal it does list my deferred Classic and Alpha benefits. 

Preserved here shows the values of my annual pension and lump sum (where applicable) at date of leaving,  revalued is the value of these with all the CPI increases to date applied. 

Bravepants

moo121 said:

I haven't received my McCloud options yet (although I believe I'm in scope) but on my preserved benefits page on the portal it does list my deferred Classic and Alpha benefits. 

Preserved here shows the values of my annual pension and lump sum (where applicable) at date of leaving,  revalued is the value of these with all the CPI increases to date applied. 

Thanks for your reply.

The problem with mine is that the revalued version of Alpha is lower than the preserved value! And I don't understand why. 

Bravepants

I think MyCSP has made a mistake in my calculation for Alpha.

I have sent a message to MyCSP via the website contact entry form and will see what they say. I will report back here if/when I hear something. 

Bravepants

Just an update on this, I have heard nothing from the online contact form submission that I made.

Meanwhile on Tuesday I received the pension benefits quotation that I requested. It seems incorrect as I had suspected! The quote for my Premium portion seems to be calculated correctly (average of 3 year period over last 13 years etc.) and I'm quite pleased with the outcome for that.

However they seem to have reduced my Alpha pension by the amount of Added Pension that I bought. Upon reading the Premium figures more closely I see that they have taken the Added Pension I bought in Alpha and added it to Premium instead. Bearing in mind this is Option B - in other words I remain in Alpha from 1 April 2015 and therefore I would expect the figures to be in line with all the annual benefits statement I have received since that time.

They then seem to have reduced the Added Pension by the actuarial reduction factor for taking premium early, added it to the calculated Premium earned pension amount and then applied the actuarial reduction to the sum again!

What on earth is going on?

I telephoned CSP on Wednesday and the guy I spoke to said I should hear something in 5 to 10 working days. So far so rubbish, I have no idea what's going on with these numbers! It's quite disconcerting.

Also the form I received to select lump sum etc has no tick box or other mechanism for selecting to take Alpha early and to leave Premium until NRA (four years away)! I asked the chap on the phone about this and he said that I should write a covering letter with my forms, or write a short note on the forms to explain what I want to do. 

I told him that if I can't trust the figures they have produced how on earth can I trust them to take into account a covering letter which defies the standard form content!

So far this has been a somewhat bewildering experience.

 

m_c_s

I think the next 12 months will be chaotic with regards to Civil Service pensions. Not only is there a change of company administering the pensions but the McCloud remedy statements for both those still in service and retired will be sent out to millions of people. Lots of reports that the calculations are wrong by a large margin and my Option B calculation is simply nonsense.
I don't know if this is human error or they are relying on mass computer calculations but thankfully I have kept all my past Annual Benefit Statements since 2015 showing my Alpha pension build up and I can use these as evidence if needed. The new remedy calculations have ignored my Alpha build up between 2015 and 2020, which is just wrong. From reading other peoples comments on their calculations there is something seriously wrong either generated by human error (or incompetence about not knowing what to include) or a big IT issue if computers are being used to automatically generate statements.   
The biggest issue will be the long response time from MyCSP. Taking 4 to 6 months to reply is simply not acceptable when people are relying on figures to make decision in the next 2 or 3 months.

GunJack

All I can say is I'm so glad all my preserved pension is in classic only (left 2007) so I should avoid most of this 🙂

Bravepants

GunJack said:

All I can say is I'm so glad all my preserved pension is in classic only (left 2007) so I should avoid most of this 🙂

Indeed. It's a total faff, and what's worse is that it's a faff complicated by people/computers that don't quite know what they're doing...making it a double faff!  I've got my own records, and if all fails a patch of brick wall against which to beat my own head, which will give me something to do while I wait!

Bravepants

Well I applied for my pension by sending my forms back on 27th July. I did this despite not hearing back about my Added Pension query (above) after waiting 10 days for a reply. 

I have since heard nothing despite emailing MyCsp on 5th August (two weeks ago) to check on progress, so I don't know whether I'm getting my first pension payment at the end of this month or not!

westv

Obviously it doesn't work like that but you would have thought a system could be set up to accurately work out each member's benefits via what is already there..
When people are employed it's all logged somewhere. The pay is recorded and their working patterns are recorded.
In my world a computer is used to bring all that info together to produce an up to date benefit statement.

Bravepants

westv said:

Obviously it doesn't work like that but you would have thought a system could be set up to accurately work out each member's benefits via what is already there..
When people are employed it's all logged somewhere. The pay is recorded and their working patterns are recorded.
In my world a computer is used to bring all that info together to produce an up to date benefit statement.

Or at least tell me what they have done in order to come up with the figures they present.

I'm a retired engineer so I am used to seeing peoples' workings out when they present numbers to me!