Local Government Pension Scheme ( LGPS )
Information about changes applicable from 1 April 2008
The LGPS is changing from 1 April 2008. These are the main changes that are happening:
| Band | Pay Range | Cont Rate |
|---|---|---|
|
1 |
£0 - £12600 |
5.5% |
|
2 |
£12601- £14700 |
5.8% |
|
3 |
£14701- £18900 |
5.9% |
|
4 |
£18901- £31500 |
<>6.5%
|
|
5 |
£31501- £42000 |
6.8% |
|
6 |
£42001- £78700 |
7.2% |
|
7 |
£78700 + |
7.5% |
- Employee contributions will be set according to bands of full time equivalent pay. The contribution rates for scheme members will vary between 5.5% and 7.5%***
The rates above are applicable from 1 April 2009. UEL is contributing 23.6% into the scheme for each staff member in the 2011-12 tax year.
- Only employees with a contract of employment of more than three months duration will be able to be members of the LGPS.
- For membership from 1 April 2008, pension accrues at the rate of 1/60th of final pay per year and there is no automatic lump sum for service after this date.
- You can exchange part of your annual pension for a one off tax-free cash payment. You can take up to 25% of the capital value of your pension benefits as a lump sum and you will receive £12 lump sum for each £1 of pension given up
- Unreduced benefits are payable early on redundancy or inefficiency grounds from age 55 (with protection for existing members aged 50, leaving before 31 March 2010).
- Benefits payable early on voluntary retirement from age 55 (or 50 where protection applies) subject to employer consent if under 60, and also to actuarial reductions if appropriate.
- Immediate unreduced benefits payable on ill-health, if unlikely to obtain gainful employment within a reasonable period.
- After two or more years membership has been attained, ill health benefits will be increased depending on the degree of incapacity on a two-tier basis. If the member is likely to obtain gainful employment by age 65, extra membership of 25% of the period to age 65 is awarded. If not, then extra membership of 100% of the period to age 65 is awarded.
- Death grant for death in service is increased from two times pay to three times.
- A survivor pension will become payable to a ‘nominated cohabiting partner’ – Forms available from the LB Barking & Dagenham Pension Section
- Members can buy up to a maximum of £5000 of additional annual pension in units of £250. This replaces the facility to buy extra membership (added years).
- Final pay will continue to be the best of the last three consecutive years. If pay has been reduced because of a job downgrading, an average of annual pay in any three consecutive years ending 31 March within the period of ten years, ending with the last day he was an active member can be used.
