Pension reduced dramatically when moving from Full-time to Part-time ? Maybe NOT !

Tweds8

I wanted to relate my experiences in getting the pension that my partner deserved when she retired from work recently in September 2024, in order to assist others who might have concerns and may be able to appeal in the future.
In short, we found out about "Regulation 10" because I wouldn't take the standard answers from certain "front of desk" people in the workplaces.
The result was an eye-watering 63% increase in yearly and maximum transmuted lump sum payments.
Now for the woffle...
My partner had worked for 49 years, the last 10 part-time, through 3 separate schemes, although not joining the works Defined Benefit scheme until 01/10/1995.
In 2008 the scheme changed and didn't provide a lump sum thereafter, but all her subsequent statements showed a declining lump sum which were being based upon her final salary at retirement of under £10,000 (so tax free for the last 10 years) and the 3rd scheme being a CARE one.
We had a meeting in July with her university finance representative in Liverpool for 50 minutes who said "All I do is hand over the final salary figure to the Pensions dept who work out the figures at GMPF in Manchester". 
I wasn't happy with this, saying what about her back statements when working full-time ?
There was no answer given or even "I'll ask for you".
And to add "insult to injury" she apologised for sending in 2 inflated figures in 2021 and 2022, meaning £1000 less pension in 2023 !!!  
When we eventually contacted the GMPF in Manchester by telephone, it was much the same, in that "We just work on the final salary figure that your employer sends us".
This is when I said I would like to speak with someone higher up the chain at GMPF please.
In our conversation with the team leader, she mentioned about Regulation 10 which takes into account what you were earning 10 years ago !!!
BUT, we have to "ask for it" !!! So we did.
Who would normally know about that ? 
It transpired that her workplace were also asking for assistance due to their lack of training.
Ironically at the first meeting in July, the lady was also in a similar position, full to part-time.
So hopefully I have helped out at least 1 blind soul when she comes to retire !!!
Moral of the story is Never Give Up !

Dazed_and_C0nfused

Most DB schemes use the full time equivalent pay for final salary pension purposes.

For example someone working 20 hours for £15k when full time is 40 hours for £30k only accrued 0.5 of a year service each year they worked but thier final salary was £30k.

Regulation 10 is mentioned here and simply being part time doesn't seem to be (obviously) relevant.

https://www.oxfordshire.gov.uk/business/oxfordshire-pension-fund/pension-fund-employers/reduction-pay

Silvertabby

The 10 year best average pay calculation isn't triggered  by switching from full time to part time in the same post, as the whole time equivalent pay is used regardless.  As Dazed says, it's then the pensionable service that is reduced.

Tweds8

Yes, they did use FTE pay !
And I had to ask for Regulation 10 which then took into account the full time years, so very relevant.
A 63 % increase was achieved !!!
I didn't post the above for you and others in the know, more to help others who are floundering. 

Silvertabby

Tweds8 said:

Yes, they did use FTE pay !
And I had to ask for Regulation 10 which then took into account the full time years, so very relevant.
A 63 % increase was achieved !!!
I didn't post the above for you and others in the know, more to help others who are floundering. 

There must have been a qualifying drop, other than a simple reduction in hours, for them to have used the 10 year rule.

Yes, it can be lucrative as the 'best pay' figure then has CPI added - and the last two years increases  in particular have been higher than normal.

That said, an increase of 63% is...surprising.  I would be inclined to ask your LGPS to double check this - and explain why the uplift was so high - before making any plans for this money!

marky_b_2

Dazed_and_C0nfused said:

Most DB schemes use the full time equivalent pay for final salary pension purposes.

For example someone working 20 hours for £15k when full time is 40 hours for £30k only accrued 0.5 of a year service each year they worked but thier final salary was £30k.

Regulation 10 is mentioned here and simply being part time doesn't seem to be (obviously) relevant.

https://www.oxfordshire.gov.uk/business/oxfordshire-pension-fund/pension-fund-employers/reduction-pay

Tweds8 sorry for jumping on your post.

My wife works 20 hours per week part time in the civil service, on the above scenario, what would happen if she is working most weekends and has earned a further £8000 pensionable pay.

Would her full time equivalent be £30000 + £8000 = £38000?

She has 19 years Premium pension before moving into alpha in 2022 and the Premium is still tied into her pensionable salary.

Lemon_dr1zzle

Tweds8 said:

Yes, they did use FTE pay !
And I had to ask for Regulation 10 which then took into account the full time years, so very relevant.
A 63 % increase was achieved !!!
I didn't post the above for you and others in the know, more to help others who are floundering. 

Bit of a rude reply to someone just clarifying the actual situation for you. 

Its very clear on the scheme website that you can use best 3 year average in last 10 due to pay decrease. It does not apply if you just choose to go PT from FT

Marcon

Tweds8 said:

Yes, they did use FTE pay !
And I had to ask for Regulation 10 which then took into account the full time years, so very relevant.
A 63 % increase was achieved !!!
I didn't post the above for you and others in the know, more to help others who are floundering. 

That's a pretty ungracious response, especially for a newcomer to this site. People have gone to the trouble of expanding/explaining a little more for the benefit of those reading this thread. Your post on its own isn't that helpful because it is lacking in relevant information/understanding, which is exactly why people post here: to improve their own knowledge and that of other people, usually as a result of input from those 'in the know'.

Maybe a thank you to the likes of SilverTabby and Lemon Drizzle, both highly experienced LGPS administrators, would have been appreciated?

hyubh

Tweds8 said:

In our conversation with the team leader, she mentioned about Regulation 10 which takes into account what you were earning 10 years ago !!!
BUT, we have to "ask for it" !!! 

The 'but' is, quite literally, what Regulation 10 of the 2008 regs says (emphasis added):

10.—(1) Subject to paragraph (2), where a member’s pensionable pay in a continuous period of employment is reduced or restricted—

(a) because the member chooses to be employed by the same employer at a lower grade or with less responsibility;

(b) for the purposes of achieving equal pay in relation to other employees of that employer;

(c) as a result of a job evaluation exercise;

(d) because of a change in the member’s contract of employment resulting in the cessation or restriction of, or reduction in, payments or benefits specified in the member’s contract of employment as being pensionable emoluments; or

(e) because the rate at which the member’s rate of pay may be increased is restricted in such a way that it is likely that the rate of the member’s retirement pension will be adversely affected,

the member may choose to have his or her final pay calculated in accordance with paragraph (4), by giving notice—

(i) in writing;
(ii) to the appropriate administering authority; and
(iii) no later than one month prior to the date on which the member ceases active membership.

https://lgpsregs.org/timelineregs/LGPS2008Regs/SI20140044/20071166.htm#reg10

So we did.
Who would normally know about that ? 

Through the materials provided 

When your partner joined the LGPS, there was a similar provision in the rules of the time, though a bit more formal - the employer would need to have issued a 'certificate of protection' to the scheme administrator (GMPF in this case) first. I am 90% confident this would have been mentioned in the scheme booklet issued on joining. When the scheme changed in 2008, there was a big communication exercise, and the (revised) pay protection clause would have been mentioned. There would have been more, but here's the short article the Local Government Association (LGA) produced for scheme administrators to circulate (basically the LGA produces these materials, which the individual fund can then add their own branding on) - pay protection is mentioned on the top of p.7:

https://www.redbridge.gov.uk/media/8660/newsletter-2008-scheme-march08.pdf

Ironically at the first meeting in July, the lady was also in a similar position, full to part-time.

As the others have explained, this is not about allowing for part time service, which is taken account of by default. Rather, it's for when the member's rate of pay has fallen or otherwise not kept up with inflation for reasons other than just general pay rise restrictions.

PS - it's perfectly understandable this went outside your partner's notice. And you're correct in your basic point about getting clarification, though I'd put that in terms of it always being worth querying where DB benefits have fallen in real terms while still an active member.