Over 85 year old querying amount taken contracted out of state pension

badmemory

If they are over 80 then they should be receiving the massive (yes I am being sarcastic) 25p a week extra.  I think this should be quoted separately on the letter as it does not receive any uplifts due under the triple lock I believe.

Dazed_and_C0nfused

badmemory said:

If they are over 80 then they should be receiving the massive (yes I am being sarcastic) 25p a week extra.  I think this should be quoted separately on the letter as it does not receive any uplifts due under the triple lock I believe.

And now abolished for those reaching SPA after 5 April 2016!

badmemory

Dazed_and_C0nfused said:

And now abolished for those reaching SPA after 5 April 2016!

Thanks I wasn't sure about that.  I'm surprised they didn't stop it along with the WFP, also surprised they didn't stop the Xmas £10 bonus too.  But let us not give them ideas.

Parsnip1

Marcon said:

Parsnip1 said:

Each have state pensions.
Each have a local government pension (that they are pretty sure they didn't contract out from)
My step Dad has a £35 a month pension from an employer that he thinks he could well have contracted out from.
Mum doesn't have any other employer pensions

Step Dad's state pension is £176 a week.

He got the information from the annual letter that the DWP Pension Service send in April to inform him of increases in benefits:
It says how your benefit is made up - Basic State Pension £176
Pre 97 annual State Pension £163
Less Contracted-Out Deduction (COD) of £95

Thank you!

So your step dad is receiving the full rate of basic state pension applicable to someone who reached their state pension age before April 2016 (ie £176).

During his membership of the Local Government Pension Scheme (LGPS), he paid a lower rate of NI and didn't build up any entitlement to State Additional Pension (SERPS, later State Second Pension). The COD of £95 refers to the State Additional Pension benefits which (in broad terms) he might otherwise have built up during this period had he not been 'contracted out' of the State Additional Pension. But he was contracted out, so the LGPS rather than the state is paying benefits in addition to his basic state pension - and I imagine his LGPS pension is considerably more than £95 a week?

Sometimes giving people information they don't actually need only serves to increase their confusion and sense of being hard done by - something which happens all too often in pensions.

Thank you. That really helps, and I agree about the information.

Parsnip1

Thanks to everyone who has responded, your time and efforts much appreciated. I'll get back to my relatives and explain.

Sarahspangles

Parsnip1 said:

Thanks to everyone who has responded, your time and efforts much appreciated. I'll get back to my relatives and explain.

I have LGPS pensions. If it helps, the decision about contracting out of the State Second Pension/SERPS won’t have been presented as ‘Do you want to contract out of S2P/SERPS?’, it will have been ‘You are being automatically enrolled in the Local Government Pension Scheme’ and there will then have been information about the implications, including contracting out. However staying in an LGPS pension was a good decision- and your relatives aren’t in a minority as most people of their age with a private pension will have had final salary (defined benefit) pensions which were contracted out.