What was SERPS and where did my pension contributions go to?

theminister

Hi
From September 1996 to September 1998, I worked for a construction company in Darlington. I paid approximately £150 per month for two years. When I left the company they said they were paying all my contributions into SERPs for me as I had not quite me the full 2 year working period for the company pension. I've tried to find out where my money went to but I have no idea where to get started. Any help would be Appreciated. Thanks AD

DRS1

SERPS was part of the old state pension.  The earnings related part which was on top of the basic state pension.

You need to look on your personal tax account to see what your state pension forecast is and what COPE amount you have (maybe you have some if you worked for someone else in the years when SERPS or S2P applied and you were contracted out for that other employment  - I am not sure if anyone on here would be able to tell you if 1996 - 1998 had been reinstated if you posted your COPE amount)

Your contributions to the pension scheme of your old employer may have been for more than SERPS.  Are you sure you did not get a refund of any contributions?

xylophone

You were a member of an occupational pension scheme that was contracted out of the State Earnings Related Pension. 

In consequence, both you and your employer paid NI at the lower contracted out rate. You were accruing only the Basic State Pension.

You were however accruing a scheme pension. 

It seems that you were not a member of the  occupational scheme long enough for your pension to vest so that when you left, you were

not entitled to a deferred  scheme pension.

Your employer made a payment into the SERP so that you would have additional state pension to cover the time you were in the

occupational scheme.

Marcon

theminister said:

Hi
From September 1996 to September 1998, I worked for a construction company in Darlington. I paid approximately £150 per month for two years. When I left the company they said they were paying all my contributions into SERPs for me as I had not quite me the full 2 year working period for the company pension. I've tried to find out where my money went to but I have no idea where to get started. Any help would be Appreciated. Thanks AD

Two things would have happened when you left the company with under two years of pension scheme membership:

• your employment was 'contracted out' of SERPS and both you and the employer paid lower NI. Something called a 'Contributions Equivalent Premium' (CEP) was paid to reinstate you into SERPS for the period of your employment and scheme membership with the construction company
• you would have received a refund of any personal contributions to the scheme, minus tax and your share of the CEP, at the time you left. Your last pay packet when you leave a job often differs from regular monthly payments to adjust for things like holiday pay, possible season ticket loan, a period which isn't quite a month and so on, and it's extremely easy to miss the 'refund' - even when it's quite sizeable.

michaels

The government confiscated your serps and s2p payments when they changed the pension rules.

DRS1

michaels said:

The government confiscated your serps and s2p payments when they changed the pension rules.

No They had already spent them on someone else's pension

xylophone

The government confiscated your serps and s2p payments when they changed the pension rules.

OP, accurate information re New State Pension  which was introduced 6/4/16 - full NSP was £155.65 at inception.

https://assets.publishing.service.gov.uk/media/5a7a21fd40f0b66a2fc00201/single-tier-pension-fact-sheet.pdf

 Guide produced by the government to explain it to the general public.

michaels

xylophone said:

The government confiscated your serps and s2p payments when they changed the pension rules.

OP, accurate information re New State Pension  which was introduced 6/4/16 - full NSP was £155.65 at inception.

https://assets.publishing.service.gov.uk/media/5a7a21fd40f0b66a2fc00201/single-tier-pension-fact-sheet.pdf

 Guide produced by the government to explain it to the general public.

TLDR - if you had accrued serps / s2p to take you to the level of the new state pension then you were left in the position where any further NI you paid accrued you precisely nothing whereas if you had instead previously opted out you would have a nice DC pot and then be able to earn the rest of a full state pension via your future NI payments.

!!!!!! Turpin wore a mask.

westv

michaels said:

xylophone said:

The government confiscated your serps and s2p payments when they changed the pension rules.

OP, accurate information re New State Pension  which was introduced 6/4/16 - full NSP was £155.65 at inception.

https://assets.publishing.service.gov.uk/media/5a7a21fd40f0b66a2fc00201/single-tier-pension-fact-sheet.pdf

 Guide produced by the government to explain it to the general public.

TLDR - if you had accrued serps / s2p to take you to the level of the new state pension then you were left in the position where any further NI you paid accrued you precisely nothing whereas if you had instead previously opted out you would have a nice DC pot and then be able to earn the rest of a full state pension via your future NI payments.

!!!!!! Turpin wore a mask.

Stupid forum censoring lol!!

Linton

Omichaels said:

xylophone said:

The government confiscated your serps and s2p payments when they changed the pension rules.

OP, accurate information re New State Pension  which was introduced 6/4/16 - full NSP was £155.65 at inception.

https://assets.publishing.service.gov.uk/media/5a7a21fd40f0b66a2fc00201/single-tier-pension-fact-sheet.pdf

 Guide produced by the government to explain it to the general public.

TLDR - if you had accrued serps / s2p to take you to the level of the new state pension then you were left in the position where any further NI you paid accrued you precisely nothing whereas if you had instead previously opted out you would have a nice DC pot and then be able to earn the rest of a full state pension via your future NI payments.

!!!!!! Turpin wore a mask.

Wrong.  If you had accrued more than the new standard SP prior to 2016, you kept it.

Secondly, the transfer from the old basic pension to the new standard pension was said to be cost neutral. So those with higher wages lost the opportunity to raise their SP to very high levels whereas the lowest paid gained. More Robin Hood than Richard Turpin.

artyboy

westv said:

michaels said:

xylophone said:

The government confiscated your serps and s2p payments when they changed the pension rules.

OP, accurate information re New State Pension  which was introduced 6/4/16 - full NSP was £155.65 at inception.

https://assets.publishing.service.gov.uk/media/5a7a21fd40f0b66a2fc00201/single-tier-pension-fact-sheet.pdf

 Guide produced by the government to explain it to the general public.

TLDR - if you had accrued serps / s2p to take you to the level of the new state pension then you were left in the position where any further NI you paid accrued you precisely nothing whereas if you had instead previously opted out you would have a nice DC pot and then be able to earn the rest of a full state pension via your future NI payments.

!!!!!! Turpin wore a mask.

Stupid forum censoring lol!!

Someone doesn't like the look of your Richard...