NHS Final Salary Link

Bananas_1

Hi all 

I began working for the NHS in early 1990 and paid into the 1995 NHS pension scheme from the very start. I remained continuously employed, was moved under TUPE to the civil service and CS Alpha career average pension scheme on 01/04/2015 (no change of job and remained on Agenda for Change terms and conditions).

My understanding was that my NHS pension 1995 payments, if taken when I'm 60, would be based on my highest salary in my final 3 years of being employed by the NHS (AfC grade 6 £40,809). I received an email from NHS Pensions that backs this up.

However, it's now become apparent if I'd still been employed by the NHS and moved into their career average scheme in 2015 my 1995 pay out would be based on my final salary when I came to retirement at 60, NOT as it was when I left the 1995 scheme in 2015. The same applies to civil service employees in the Alpha career average scheme who were previously in the CS Classic final salary scheme. Surely as both are public sector pensions, and I was moved under TUPE, not because I changed job, the same rule will apply for me.

I'm very concerned by this as in Winter 2022 I became a full-time homeworker, relocating from my central London office base to working from my home outside London. This meant a reduction in my salary (from £40,809 to £36,530) due to loss of London weighting.

If my NHS 1995 pension is still linked to my salary that will mean the last time I was paid £40,809 was in the year 2021/2022. How do I retain my NHS pension scheme tied to this amount?

If I continue to pay into the Alpha scheme to the end of 2024/25 my highest salary in the last 3 financial years will have been £38,926.47. The longer I work at the new lower salary will mean, if salary linked, my 1995 pension will eventually be based on my current salary of £36,530. As I moved to civil service under AfC terms and conditions my pay has been permanently frozen.

My Total Reward statements continue to be updated with my new salary under the Financial Summary section, so there obviously is still some link to my current salary.

MumOfTwoStudents

Hi, did you get to the bottom of this?

I was in 1995 from 1997 to 2012 salary 39k. I left for three years and returned on the 2015 scheme to work on the bank as a band 2 HCA, for about 3 years, final salary about 19k. Salary halved. I didn't rejoin for another 8 years - better salary now, but not joined.

I've asked NHS Pensions but I've been waiting for a response since February - if my pension is halved I really want to do something about this whilst I have time. I'm 50 in September.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/82067283#Comment_82067283

The OP has never returned to the forum after starting this thread, nearly two years ago.

hyubh

https://forums.moneysavingexpert.com/discussion/comment/82067283#Comment_82067283

If I'm reading the OP correctly, on a TUPE they moved out of the NHS Pension Scheme into Alpha, but did not then transfer their NHS benefits into the CSPS. Ergo their NHS pension remained deferred and relative to their final salary on leaving the NHS.

If I am reading your situation correctly, it is quite different. You have only ever been a member of the NHS Pension Scheme. Given the gap in membership was less than 5 years, aggregation would have been automatic. Unfortunately, as your lower rate of pay on rejoining was voluntary, 'Protection of Pay' terms weren't applicable and you got a final pay link whether you wanted it or not. However 'Voluntary Protection of Pay' probably wasn't available either, as you had not met the minimum retirement age (see factsheet)

'better salary now, but not joined'

Hmm, the pension scheme is a big part of your total renumeration package….