Local Government Pension Rule of 85

RegMuffin

Having spent a lot of time in local government I am totally naive about my pension and rights and the 85 year thing is befuddling me, just at the point when I need to take a decision. Help!

I'm 55 and I've been in three schemes in total, and they're separate still. I am now faced with leaving local government and I reckon I'll meet the 85 year rule later this year so need to know if it's possible to bide time and whether it's worth it.

I need to know whether only whole years count for the rule or whether part years added up count towards the 85 rule? And does it matter that these schemes (all LGPS) are spread out over the last 30 years and with different administrators? Any ideas?

Baldytyke88

The Rule of 85 was a pension scheme provision that allowed members to retire early without penalty. It was removed in 2006, but some protections remain for members who joined before that date.

Silvertabby

If you have 3 separate records with 3 different authorities, then your combined service won't count towards R85.

In order to have any protections, you must have joined before 1 October 2006.  Even then, at your age, R85 will only apply to your pre 2008 service.  Even worse, I'm afraid, even though LGPS benefits may now be accessed from (currently) 55, R85 protections are still linked to a minimum retirement age of 60.

The actual calculations are based on days rather than whole years, but if you post your start/stop dates of each post by just years, I'll be able to give you a better idea.

RegMuffin

Thanks greatly. I'm aware of the 60+ age requirement but mindful I may leave local government shortly and not return, with 84 years combined, I think.

In summary I was in from 1988-2016 with a six year gap, so almost 22 years in the scheme. Then a gap of a year and in from 2017 to today. Almost 8 years but with another LGPS administrator. 

Is there a way of combining them and trying to reach 85?

Sarahspangles

Half way down this page https://www.lgpsmember.org/your-pension/planning/taking-your-pension/

You satisfy the 85-year rule when your age and length of LGPS membership add up to 85.

If your pension from earlier service is deferred, it still counts as membership. So you don’t need to add up your three periods of service. Just what age + number of years since joining you will have reached at 60. You need to clarify when your break was after the first period of service because that determines whether all, or just a proportion of your service will be protected.

Silvertabby

RegMuffin said:

Thanks greatly. I'm aware of the 60+ age requirement but mindful I may leave local government shortly and not return, with 84 years combined, I think.

In summary I was in from 1988-2016 with a six year gap, so almost 22 years in the scheme. Then a gap of a year and in from 2017 to today. Almost 8 years but with another LGPS administrator. 

Is there a way of combining them and trying to reach 85?

Are you saying that there is a 6 year gap in the 1988 to 2016 period? If so, can you give dates (just years will do).

2017 to current = joined after 1 October 2006, so no R85 eligibility (irrelevant, as only any pre 2008 accruals would have been protected).

Were you asked if you wanted to combine your earlier service when you joined in your later posts?  If yes, and if you declined because your new salaries were lower than your old, then that will likely still apply.  Possibly more so, as your deferred benefits will have increased in value by CPI - and the 2023/2024 bumper increases are likely to be higher than your salary increases over that period.

Also consider that combining your records (which is probably not possible/advisable at this late stage) won't give you anywhere near full R85 benefits.  Only your pre 2008 accruals are protected, with your 2008 to 2014 accruals being fully reduced for early payment before age 65, and your post 2014 accruals being fully reduced for early payment before SPA/67(?). 

RegMuffin

Silvertabby said:

RegMuffin said:

Thanks greatly. I'm aware of the 60+ age requirement but mindful I may leave local government shortly and not return, with 84 years combined, I think.

In summary I was in from 1988-2016 with a six year gap, so almost 22 years in the scheme. Then a gap of a year and in from 2017 to today. Almost 8 years but with another LGPS administrator. 

Is there a way of combining them and trying to reach 85?

Are you saying that there is a 6 year gap in the 1988 to 2016 period? If so, can you give dates (just years will do).

2017 to current = joined after 1 October 2006, so no R85 eligibility (irrelevant, as only any pre 2008 accruals would have been protected).

Were you asked if you wanted to combine your earlier service when you joined in your later posts?  If yes, and if you declined because your new salaries were lower than your old, then that will likely still apply.  Possibly more so, as your deferred benefits will have increased in value by CPI - and the 2023/2024 bumper increases are likely to be higher than your salary increases over that period.

Also consider that combining your records (which is probably not possible/advisable at this late stage) won't give you anywhere near full R85 benefits.  Only your pre 2008 accruals are protected, with your 2008 to 2014 accruals being fully reduced for early payment before age 65, and your post 2014 accruals being fully reduced for early payment before SPA/67(?). 

Yes, there is a 6 year gap in the 1988 to 2016 period:
1988-1994 in scheme.
1994-2000 out of scheme.
2000-2016 in scheme (joined with above). 
Total 28 years, of which almost 22 were in the scheme.

Then 2017- current in the scheme, almost 8 years and not tied to the above scheme (that was never presented as an option).

I don't intend to draw it at 60, but things do change! All I'm wondering is whether to jump ship from the LGPS now, about 3-4 months short of reaching R85 if that's a possibility. Or whether I'll regret getting to 84+ if it's found to have made a difference in 5-10 years time.  

hyubh

RegMuffin said:

Silvertabby said:

RegMuffin said:

Thanks greatly. I'm aware of the 60+ age requirement but mindful I may leave local government shortly and not return, with 84 years combined, I think.

In summary I was in from 1988-2016 with a six year gap, so almost 22 years in the scheme. Then a gap of a year and in from 2017 to today. Almost 8 years but with another LGPS administrator. 

Is there a way of combining them and trying to reach 85?

Are you saying that there is a 6 year gap in the 1988 to 2016 period? If so, can you give dates (just years will do).

2017 to current = joined after 1 October 2006, so no R85 eligibility (irrelevant, as only any pre 2008 accruals would have been protected).

Were you asked if you wanted to combine your earlier service when you joined in your later posts?  If yes, and if you declined because your new salaries were lower than your old, then that will likely still apply.  Possibly more so, as your deferred benefits will have increased in value by CPI - and the 2023/2024 bumper increases are likely to be higher than your salary increases over that period.

Also consider that combining your records (which is probably not possible/advisable at this late stage) won't give you anywhere near full R85 benefits.  Only your pre 2008 accruals are protected, with your 2008 to 2014 accruals being fully reduced for early payment before age 65, and your post 2014 accruals being fully reduced for early payment before SPA/67(?). 

Yes, there is a 6 year gap in the 1988 to 2016 period:
1988-1994 in scheme.
1994-2000 out of scheme.
2000-2016 in scheme (joined with above). 
Total 28 years, of which almost 22 were in the scheme.

Then 2017- current in the scheme, almost 8 years and not tied to the above scheme (that was never presented as an option).

Assuming you don't rejoin and aggregate, years deferred are counted for 85 year rule purposes. What isn't counted, however, is any break between aggregated memberships. But nevertheless: 1988-1994 = 6 years, 2000-2025 = 25 years, 6+25+55=86.

I don't intend to draw it at 60, but things do change! All I'm wondering is whether to jump ship from the LGPS now, about 3-4 months short of reaching R85 if that's a possibility. Or whether I'll regret getting to 84+ if it's found to have made a difference in 5-10 years time.  

Not drawing your first membership at 60 would be just giving up the benefit of having 85 year rule protections in the first place. For sure the CARE and 60ths parts would attract an actuarial reduction, but they are only small parts of the total pension.

Bigphil1474

The 3 schemes we've had really have made the old 85 year rule very confusing. I was of the understanding that your benefits under the scheme (up to 2008) could be taken if you meet the 85 year rule and are within 10 years of your state retirement age. The benefits from scheme 2 (2008 - 2014), and scheme 3 (2014 onwards) are different. I find that the best way to get answers for your own circumstances are to speak to your LGPS provider.

RegMuffin

Bigphil1474 said:

The 3 schemes we've had really have made the old 85 year rule very confusing. I was of the understanding that your benefits under the scheme (up to 2008) could be taken if you meet the 85 year rule and are within 10 years of your state retirement age. The benefits from scheme 2 (2008 - 2014), and scheme 3 (2014 onwards) are different. I find that the best way to get answers for your own circumstances are to speak to your LGPS provider.

Therein lies the problem. I spoke to both, and each pointed me to the other. Fast forward two months and both have written to the other. Couldn't make it up.

Silvertabby

There was a time when R85 protections still applied to some post 2008 accruals, on a sliding scale.  But OP is way too young to fall into that category.  In OP's case, any R85 protections only apply to pre 2008 benefits, and are still linked to a minimum retirement age of 60.