State Pension plus Works Pension

Or the records kept by the Government are wrong and that has not been corrected in the recent clean up of records and that may be sorted in the future but you never know.

Alex444 wrote: »

My mate has a private works pension and he has deduction from his State Pension, so does not receive full amouof approx £165.00 per week.
Spoke with a friend last night who retired from Naval Dockyard (MOD) last week, he is 67yrs of age, and for the last 2 years has been paid an State Pension of £196.00 per week and is expecting to continue being paid at that rate.

The maximum state pension without deferral or inheritance is about £305 a week. That's made up of 30 years towards the basic state pension and a full working life of say 43 years on high earnings to get the maximum earnings-related part. 43 isn't a cap, someone could start work at 16 and get in 49 years, or younger still.

A lifelong low earner, around minimum wage, would get around £190 a week.

Both of those are old rules calculations for those who did most of their contributing before April 2016.

Starting in April 2016 the new state pension imposes a cap of £168.60 and people can't increase above that by paying more NI. Those who were over that on 6th April 2016 keep the higher amount but the part above 168.60 increases by CPI instead of triple lock.

Most works pensions contracted people out of the earnings-related part of the state pension in exchange for agreeing to make comparable payments. COPE is an estimate of how much of the works pension is a result of this contracting out.

To get £196 a week and a works pension means at least some working years were in a pension that wasn't contracted out and at least some were in a works pension. Not hard on a good wage.

There's an alternative new rules calculation but people get the higher of the two and with contracting out that will usually be old rules.

Alex444 wrote: »

Do not understand the calculations for this, told him to watch out for COPE, which went over his head!

No need to watch out, it isn't deducted from the pension given in the state pension statement. If it says £196 then he's going to get that.

Alex444 wrote: »

retired from Fire Service with full pension, and on achieving 65yrs was awarded State Pension, with a deduction as I have a Local Authority Fire Pension, this means on current rates I loose approx £15.00 a week.

If you want us to check whether you can get more please tell us when you reached your state pension age and what your state pension contribution record looks like from the year you retired. I have the impression that there were some years between the two, maybe as many as 15. If so, buying a few years can get you to 168.60 with a payback time of 3-4 years.

jamesd wrote: »

The maximum state pension without deferral or inheritance is about £305 a week. That's made up of 30 years towards the basic state pension and a full working life of say 43 years on high earnings to get the maximum earnings-related part. 43 isn't a cap, someone could start work at 16 and get in 49 years, or younger still.

A lifelong low earner, around minimum wage, would get around £190 a week.

What was the rate of pension accumulation with SERPS? Apparently there must have been an upper earnings limit.

Something else that may be a factor - sometime during SERPS/S2P there was an earnings-related element added if you were a "low earner" even though you were contracted-out...something to do with GMP.

I only found this out when checking out my 2016 foundation amount as it was a bit more than I thought it would be...and I've been contracted-out my entire career. The period of time in question was when I was a Civil Servant, so I can see where this would fit in with the OP's questions.

Silvertabby wrote: »

Ditto. SERPS changed to SP2 in 2002. The intention was to give a better rate of additional State pension to the lower paid (ie, those earning less than the average salary - even if they had chosen to work part time). Rather than re-jig contracting out, it was decided that the 'simplest' way round this would be to pay the difference between SERPS and SP2 as additional State pension.

I wonder if that is the case with me. I was surprised to see that my state pension forecast showed that I would have full contributions at age 65 and the maximum SP. I thought that this wouldn't be the case.

I am 52 and left the UK at age 17 and lived abroad for around 13 years not paying NI and returning to the UK aged 31 and started paying NI almost immediately.

I paid Serps for one year , then started the job that I am in now, part time and paying into the LGPS, so been paying into the LGPS now for almost 19 years and will do for the next 13 - 15 years.

I have 2 years of NI credits at age 16.

I was surprised that I would get the maximum SP at age 67 , after having lived out of the country for 13 years and being contracted out.

Why is this?