Lgps

purch

I guess this question is probably unanswerable, or only answerable with a best guess....but here goes

My next door neighbours wife currently is a school cook employed by the local authority and a member of the LGPS. It is likely that the school will end their contract with the LA and award the contract to another providor (actually a consortium of parents and governors). She has been asked if she will work for the new contractors, therefore leaving the employ of the LA.

Her dilemma is the LGPS. What exactly is it worth to her ?

Do any of the Pension experts here have a decent idea of how you can value the benefit ?

Thanks

dunstonh

A rough guide is that any alternative salary would need to be around 15-20% higher to compensate with that 15-20% going into a personal pension to make up for it. Any contributions the new employer makes on their pension can offset that.

The consortium may not be aware that from 2012 all employers will have to pay into a pension scheme at 3%. Many companies still have yet to budget for that and my guess is that ta consortium of parents and governors isnt likely to be well informed on things like this.

Andy_L

If TUPE applies it is treasury policy that the new employer must supply a pension "broadly comparable" to, in this case, the LGPS

dunstonh

problem is that the consortium alsmost certainly cannot afford to give a comparable pension.

Andy_L

Then their business model is probably fatally flawed :-)

purch

Thanks chaps....I will pass it on

Ian_W

Don't know about "broadly comparable" if covered by TUPE but this PAGE from Direct Gov might be worth her while reading. It covers various employment issues but specifically for pensions it says:
Your occupational (company) pension rights earned up to the time of any transfer are protected by law. If your old employer offered you access to an occupational pension scheme immediately before the transfer then your new employer must offer access to either

• an occupational pension scheme which must meet certain conditions; or
• a stakeholder pension scheme where as a minimum the new employer matches employee contributions up to 6 per cent of pensionable earnings

If the scheme is defined contribution then your new employer must match employee contributions up to 6 per cent of pensionable pay.

Andy_L

Ian_W wrote: »

Don't know about "broadly comparable" if covered by TUPE but this PAGE from Direct Gov might be worth her while reading.

The "Broadly Comparable" thing is for transfers out of the Public Sector and is a guidline rather than Law. I believe it's to ensure that the cost of privitisation is compared to staying in house on a level playing field.