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  • FIRST POST
    • Tayloriw1
    • By Tayloriw1 19th Sep 19, 1:21 PM
    • 26Posts
    • 0Thanks
    Tayloriw1
    updates on FBU, Civil service pensions
    • #1
    • 19th Sep 19, 1:21 PM
    updates on FBU, Civil service pensions 19th Sep 19 at 1:21 PM
    anyone had any updates on pensions for fire brigade and police etc after winning there case a few months ago
Page 1
    • poggs
    • By poggs 20th Sep 19, 2:39 PM
    • 129 Posts
    • 69 Thanks
    poggs
    • #2
    • 20th Sep 19, 2:39 PM
    • #2
    • 20th Sep 19, 2:39 PM
    THe government agreed to report back by the 27th September with a plan encompassing all the state pension schemes.

    However there is the suggestion that the government is preoccupied with something else at the moment and will request an extension until after 31st October.
    • xylophone
    • By xylophone 20th Sep 19, 6:43 PM
    • 31,345 Posts
    • 19,428 Thanks
    xylophone
    • #3
    • 20th Sep 19, 6:43 PM
    • #3
    • 20th Sep 19, 6:43 PM
    However there is the suggestion that the government is preoccupied with something else at the moment
    I wonder what that might be?
    • swindiff
    • By swindiff 23rd Sep 19, 11:04 AM
    • 559 Posts
    • 304 Thanks
    swindiff
    • #4
    • 23rd Sep 19, 11:04 AM
    • #4
    • 23rd Sep 19, 11:04 AM
    Does this also impact the NHS pension scheme?
    • chubsta
    • By chubsta 23rd Sep 19, 1:11 PM
    • 160 Posts
    • 134 Thanks
    chubsta
    • #5
    • 23rd Sep 19, 1:11 PM
    • #5
    • 23rd Sep 19, 1:11 PM
    Does this also impact the NHS pension scheme?
    Originally posted by swindiff
    I believe it was established and acknowledged by the government that it applies to all those who were put on the Alpha scheme.

    Would be nice if they stopped taking that 2% they have been overcharging us in contributions for the last 4 years in the meantime...
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    • Andy L
    • By Andy L 23rd Sep 19, 1:30 PM
    • 10,101 Posts
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    Andy L
    • #6
    • 23rd Sep 19, 1:30 PM
    • #6
    • 23rd Sep 19, 1:30 PM
    Does this also impact the NHS pension scheme?
    Originally posted by swindiff
    Yes - it applies to all Public Sector schemes that allowed existing members who were near retirement to stay in the old schemes but moved younger members onto newer schemes
    • swindiff
    • By swindiff 23rd Sep 19, 1:35 PM
    • 559 Posts
    • 304 Thanks
    swindiff
    • #7
    • 23rd Sep 19, 1:35 PM
    • #7
    • 23rd Sep 19, 1:35 PM
    Cheers
    Would be good news for my wife who is planning on retiring at 60. She has some 1995 section pension built up that would not be reduced, but everything in the 2015 section pension would be reduced for taking the pension 7 years early. If this is the case she could take all her pension without reduction at 60
    • swindiff
    • By swindiff 23rd Sep 19, 1:37 PM
    • 559 Posts
    • 304 Thanks
    swindiff
    • #8
    • 23rd Sep 19, 1:37 PM
    • #8
    • 23rd Sep 19, 1:37 PM
    If this is age discrimination, why would it only apply to public sector schemes. Surely the same could be said for private sector schemes that have been changed in a similar way. I, for example am in the USS and exactly the same happened to our pensions.
    • Andy L
    • By Andy L 23rd Sep 19, 2:02 PM
    • 10,101 Posts
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    Andy L
    • #9
    • 23rd Sep 19, 2:02 PM
    • #9
    • 23rd Sep 19, 2:02 PM
    If this is age discrimination, why would it only apply to public sector schemes. Surely the same could be said for private sector schemes that have been changed in a similar way. I, for example am in the USS and exactly the same happened to our pensions.
    Originally posted by swindiff
    The principal does. However the results of the court-case only apply to the Government run schemes as it was the Government not, in your case, the Universities who was/were taken to court
    • swindiff
    • By swindiff 23rd Sep 19, 3:06 PM
    • 559 Posts
    • 304 Thanks
    swindiff
    So are there likely to be challenges to private schemes which have done the same using this as a precedent. I don't think that would necessarily be a good thing as it could potentially bankrupt schemes that don't have the backing of the UK government (taxpayer)
    • NedS
    • By NedS 23rd Sep 19, 7:47 PM
    • 127 Posts
    • 77 Thanks
    NedS
    Does this in any way affect me, as a person who joined the Civil Service pension scheme (alpha) after April 2015?
    • hugheskevi
    • By hugheskevi 23rd Sep 19, 8:40 PM
    • 2,342 Posts
    • 3,133 Thanks
    hugheskevi
    THe government agreed to report back by the 27th September with a plan encompassing all the state pension schemes.
    Do you have a reference for this?

    I believe it was established and acknowledged by the government that it applies to all those who were put on the Alpha scheme.
    The Government statement was that:

    As ‘transitional protection’ was offered to members of all the main public service pension schemes, the government believes that the difference in treatment will need to be remedied across all those schemes.
    That isn't quite the same as all those who were put on the Alpha scheme. Transitional protection only applied to active members in a public service pension scheme as at 31st March 2012.

    Would be nice if they stopped taking that 2% they have been overcharging us in contributions for the last 4 years in the meantime...
    What is the basis for 2%?

    Surely the same could be said for private sector schemes that have been changed in a similar way. I, for example am in the USS and exactly the same happened to our pensions.
    Was it exactly the same? I thought all USS members were moved to a new pension arrangement? Moving all employees to a new scheme is fine, as is moving all new entrants to a new scheme and allowing existing employees to continue in an existing scheme. What was ruled unlawful was allowing some members to remain in an existing scheme but not others, solely based on their age.

    Does this in any way affect me, as a person who joined the Civil Service pension scheme (alpha) after April 2015?
    Whilst it is impossible to pre-empt the decision about the remedy, only those recruited before 31st March 2012 (the cut-off date to be eligible for transitional protection) have been treated differently solely based on their age.
    • JoeCrystal
    • By JoeCrystal 24th Sep 19, 2:34 AM
    • 1,868 Posts
    • 1,314 Thanks
    JoeCrystal
    I believe it was established and acknowledged by the government that it applies to all those who were put on the Alpha scheme.

    Would be nice if they stopped taking that 2% they have been overcharging us in contributions for the last four years in the meantime...
    Originally posted by chubsta
    Overcharging the employees for the PAYG benefit schemes? These employees are still paying peanuts for such benefits. More peanuts than it used to be, but it is still peanuts! But I certainly do not begrudge these employees their pension remuneration though.
    Last edited by JoeCrystal; 24-09-2019 at 2:38 AM.
    • swindiff
    • By swindiff 24th Sep 19, 8:32 AM
    • 559 Posts
    • 304 Thanks
    swindiff
    Was it exactly the same? I thought all USS members were moved to a new pension arrangement? Moving all employees to a new scheme is fine, as is moving all new entrants to a new scheme and allowing existing employees to continue in an existing scheme. What was ruled unlawful was allowing some members to remain in an existing scheme but not others, solely based on their age.
    Originally posted by hugheskevi
    No maybe not exactly the same, there were protections in place though for staff who were closer to retirement age. I can't remember the exact details but in our contracts NRA was 65 but you could retire at 60 without actuarial reduction to your pension. This was removed going forward when they changed the pension unless you had attained the age of 55 at a particular date that I can't remember now. But in effect colleagues of mine who were a few years older than me could take their entire pension at 60 without any of it being reduced.
    • Tromking
    • By Tromking 24th Sep 19, 8:37 AM
    • 2,560 Posts
    • 4,724 Thanks
    Tromking
    Overcharging the employees for the PAYG benefit schemes? These employees are still paying peanuts for such benefits. More peanuts than it used to be, but it is still peanuts! But I certainly do not begrudge these employees their pension remuneration though.
    Originally posted by JoeCrystal
    Most public sector pensions owing to their unfunded nature are deemed as part of an employees current remuneration but payable on retirement.
    “If Britain must choose between Europe and the open sea, she must always choose the open sea”. - Winston Churchill

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    • chubsta
    • By chubsta 27th Sep 19, 9:29 AM
    • 160 Posts
    • 134 Thanks
    chubsta

    What is the basis for 2%?
    Originally posted by hugheskevi
    Sorry, I haven't got links but will try to explain it, others may be able to correct it of course -

    basically the payments the employee makes into the pension are divided into bands, at the second-lower level it is 5.25% or thereabouts. The rate is defined by how well funded the pension is.

    A review was conducted which showed the pension was over-funded and therefore employees should have only been paying 3.25% since the pension was introduced in 2015 - for me this works out at approximately a £3000 overpayment.

    The unions have demanded the payment be made back to staff, and that future payments going forward are dropped by the 2%, however the treasury have stated that although the pensions guidance states that we have indeed been over-contributing they are not going to pay us it back, nor are they going to drop the payment in the future. Of course, if they had found out we had underpaid then it would have been completely different...
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    • sammyjammy
    • By sammyjammy 27th Sep 19, 9:59 AM
    • 4,731 Posts
    • 5,222 Thanks
    sammyjammy
    Sorry, I haven't got links but will try to explain it, others may be able to correct it of course -

    basically the payments the employee makes into the pension are divided into bands, at the second-lower level it is 5.25% or thereabouts. The rate is defined by how well funded the pension is.

    A review was conducted which showed the pension was over-funded and therefore employees should have only been paying 3.25% since the pension was introduced in 2015 - for me this works out at approximately a £3000 overpayment.

    The unions have demanded the payment be made back to staff, and that future payments going forward are dropped by the 2%, however the treasury have stated that although the pensions guidance states that we have indeed been over-contributing they are not going to pay us it back, nor are they going to drop the payment in the future. Of course, if they had found out we had underpaid then it would have been completely different...
    Originally posted by chubsta
    In the terms of the agreement the review takes place every four years, it only took place this year so the reduction applies from April 2019.
    "You've been reading SOS when it's just your clock reading 5:05 "
    • Andy L
    • By Andy L 27th Sep 19, 10:06 AM
    • 10,101 Posts
    • 9,245 Thanks
    Andy L
    There's a complex interlock of employee, employee contribution caps & collers and the overall "value" of the pension.

    The review of the scheme said that some had been breached and changes, in favour of members, should be made to bring the scheme back in line (IIRC the proposals was an improved accrual rate rather than reduced contributions - 6 of 1: 1/2 Doz other).

    HMG said (paraphrasing slightly) "Fair enough, however we're going to hold off doing that until the outcome of the changes needed as a result of the Judges/FBU coutcase are known.

    https://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2019-01-30/HCWS1286/

    "given the potentially significant but uncertain impact of the Court of Appeal judgment, it is not now possible to assess the value of the current public service pension arrangements with any certainty...It is therefore prudent to pause this part of the valuations until there is certainty about the value of pensions to employees from April 2015 onwards."
    Last edited by Andy L; 27-09-2019 at 10:08 AM.
    • hugheskevi
    • By hugheskevi 27th Sep 19, 11:57 AM
    • 2,342 Posts
    • 3,133 Thanks
    hugheskevi
    basically the payments the employee makes into the pension are divided into bands, at the second-lower level it is 5.25% or thereabouts. The rate is defined by how well funded the pension is.
    The second tier contribution rate is 5.45%.

    The rate is determined in conjunction with other contribution tiers/rates to produce an overall yield of 5.6%. The target overall yield can change in the event of a cost cap breach.

    A review was conducted which showed the pension was over-funded and therefore employees should have only been paying 3.25% since the pension was introduced in 2015 - for me this works out at approximately a £3000 overpayment.
    The review concluded that the scheme was costing in excess of 2% less than intended (I don't believe the exact figure has been published).

    This triggers a requirement to either improve scheme benefits or reduce member contributions to return the scheme to the intended cost. The process was initiated but not concluded (it was suspended in January 2019) due to the McCloud judgment taking place. The McCloud judgment means the cost of the scheme is unclear, pending legal decisions about the form of the remedy. Therefore the cost of the scheme can only be determined once the McCloud legal proceedings conclude and are implemented by the scheme, enabling a Valuation based on post-remedy member data to be undertaken.

    The argument that members have been overpaying in the past is based on the Valuation being as at 31st March 2016, and showing the scheme was costing less than planned, which then triggers the cost cap process. As others have mentioned, the changes would have only applied after 1st April 2019, and there was no conclusion about whether the changes would have been to reduce member contributions or improve member benefits - the default adjustment would have been to improve the alpha accrual rate.
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