This page provides information on a variety of subjects of interest to pension scheme members. For anything that is not covered here, visit Local Government Pension Scheme (LGPS).
Your state pension age is the earliest age you can receive the basic state pension. To find out your state pension age, visit GOV.UK - Check your State Pension age.
Why become a member of the scheme?
A pension when you retire which increases in line with the cost of living each year. Your pension is a statutory scheme, which means it is secure and guaranteed and is unaffected by investment returns.
Your employer contributes (normally twice as much as you) and there are no additional management fees. You can opt to put your pension into payment from anytime from age 55 to age 75.
On retirement, you can exchange part of your pension for a tax free lump sum at the rate of £1 of pension exchanged for £12 cash up to to a maximum of 25% of all your pension benefits. You can opt to pay less by joining the 50/50 scheme.
You have cover for ill health, which means, you can be eligible for an immediate pension (at any age) if you have over two year’s service. You have cover for redundancy, and are eligible for an immediate unreduced pension if you are aged 55 and have over two years pensionable service.
If your employer has a flexible retirement policy and agrees, you could retire from age 55, take your pension benefits already built up and continue to work in a reduced role.
If you died in service, even if in the scheme for one day, your next of kin, would be eligible for a death in service lump sum of three times your actual salary.
There are also pensions available for your spouse and dependents, registered civil partner, cohabiting partner, if you die.
2014 scheme changes
On 1 April 2014 the LGPS in England and Wales became a ‘career-average’ scheme. You can find out more about career-average schemes on GOV.UK.
All pensions currently being paid or built up before April 2014 are protected. If you are currently in receipt of a pension or have deferred your pension, the changes in the scheme do not affect you.
If you were in the scheme before the changes, your pre-April 2014 pension will still be based on final salary when you leave and the current Normal Pension Age.
| 2008 | 2014 | |
|---|---|---|
| Basis of Pension | Final Salary Scheme | Career Average Revalued Earnings (CARE) (1 April 2014) |
| Accrual Rate | 1 /60th | 1/49th |
| Revaluation Rate | Based on final salary | Consumer Price Index (CPI) |
| Pensionable Pay | Pay excluding non-contractual overtime and additional hours | Pay including non-contractual overtime and additional hours |
| Employee Contribution Rate | Between 5.5% - 7.5% of pensionable pay | Between 5.5% - 12.5% of pensionable pay |
| Contribution Flexibility | None | Members can pay 50% contributions for 50% of the pension benefit |
| Normal Pension Age | 65 | Equal to the member’s State Pension Age |
| Lump Sum Trade Off | Trade £1 of pension for £12 lump sum | Trade £1 of pension for £12 lump sum |
| Death in Service Lump Sum | 3 x pensionable pay | 3 x pensionable pay |
| Death in Service Survivor | 1/160th accrual based on Tier1 ill health pension enhancement | 1/160th accrual based on Tier1 ill health pension enhancement |
For more information, see our LGPS guide PDF, 1175.21 KB.
50/50 scheme
LGPS 2014 has an option that allows you to pay half your normal pension contributions at any time. This will build up half your normal pension benefits.
There are two sections in the scheme from 1 April 2014 – the main section and the 50/50 section. In the main section you pay normal pension contributions and get the normal pension build up.
You can however choose to move to the 50/50 section. You will then pay half contributions but will only be building up half the normal pension. If you have more than one job, you can choose the 50/50 option in one, some or all your jobs.
To move into the 50/50 section, complete the 50/50 election to join form. For more information, see LGPS contribution flexibility.
Death grant beneficiary
If you are a member of the pension fund, it is advisable to nominate beneficiaries of any death grant payable in the event of your death. For more information on death benefits, refer to page 74 of the LGPS guide or contact the team.
To nominate a beneficiary, fill in the expression of wish for the payment of death grant form.
Additional Voluntary Contributions
Additional Voluntary Contributions (AVCs) allow you to pay more to build up extra savings for retirement.
If you choose to pay AVCs, they are invested separately in funds managed by the AVC provider Prudential. You have your own personal account that, over time, builds up with your contributions and the returns on your investment, and will be available to you when you retire.
You can choose to pay AVCs if you are in either the main or 50/50 section of the scheme.
From 1 April 2014, if you take out a new AVC contract, your contributions to an AVC arrangement are no longer limited to 50% of your income. This means that you can, if you wish, pay up to 100% of your income towards an AVC, after allowing for any tax, National Insurance liability or any other existing deductions you may have.
For AVC contracts from 1 April 2014, you can take up to 25% of your AVC fund as a tax-free cash lump sum (subject to HM Revenue and Customs limits).
Any AVCs are taken from your pay and, if you pay tax, you receive tax relief automatically through the payroll. Deductions start from the next available pay after your choice has been accepted. You may vary or cease AVC payments at any time while you are paying into the LGPS.
When you retire, you can use your AVCs to buy an annuity, buy a top-up LGPS pension or take up to 25% of your AVC fund as a tax-free cash lump sum.
Rejoining and opting out of the scheme
If you were a member of the LGPS and opted out, but remained in employment and now wish to opt back in, you should complete the LGPS membership form and send it to the team.
If you opted out of the scheme and became entitled to a deferred benefit, you are not permitted to join this period of membership with a new period of membership. You will have two separate pension benefits in the scheme. If you opt out then opt back in at a later date and you are in the same job, you cannot transfer in your previously-held pension rights.
If you terminate employment and later begin working for an employer who provides membership of the LGPS, you may wish to join again. If you are eligible for membership of the LGPS you will automatically become a member, unless you have a contract of less than 3 months, in which case you would have to opt to join. You should complete LGPS membership form and send it to the team if you wish to opt in to the scheme.
If you automatically become a member, you have the right to decide not to join the scheme . You’ll need to complete the opt out form for active members.
If you re-join the LGPS after having left it, your deferred pension rights will usually be combined your new pension account. We will write to you to explain your options.
If you wish to transfer previous pension rights from other pension arrangements into the LGPS, you must do so within 12 months of re-oining the scheme. Contact the team for more information.
Retirement
You can retire and draw your benefits anytime between the ages of 55 and 75. In cases of ill health, there is no lower age limit at all.
Visit LGPS for more information about when you can retire. It includes information about:
- scheme retirement date
- early retirement at your request
- early retirement through redundancy or inefficiency
- ill health retirement
- late retirement
Our retirement leaflet (PDF, 326.48 KB) contains more information.
Flexible retirement
Rather than continuing in your job to normal pension age or beyond, you may wish to consider flexible retirement. From age 55, if you reduce your hours or move to a less senior position, you can draw some or all of the pension benefits you have built up – helping you ease into retirement. You will need the agreement of your employer to do this.
If you choose this option, you can continue paying into the LGPS. You will continue to accrue benefits from the scheme. For more information, see our flexible retirement policy (PDF, 336.67 KB).
If your employer agrees to flexible retirement, all benefits accrued up to the date you take flexible retirement will be released.
If you take flexible retirement before normal pension age, your benefits will be reduced to take account of being paid for longer. The amount your benefits are reduced by will depend on how early you draw your benefits. The following table goes into more detail:
| No. of years paid early | Pensions reduction men | Pensions reduction women | Lump sum reduction |
|---|---|---|---|
| 0 | 0% | 0% | 0% |
| 1 | 6% | 5% | 3% |
| 2 | 11% | 11% | 6% |
| 3 | 16% | 15% | 8% |
| 4 | 20% | 20% | 11% |
| 5 | 25% | 24% | 14% |
| 6 | 29% | 27% | 16% |
| 7 | 32% | 31% | 19% |
| 8 | 36% | 34% | 21% |
| 9 | 39% | 37% | 23% |
| 10 | 42% | 40% | 26% |
If you were a member of the LGPS on 30 September 2006 and you are a protected member, some or all of your benefits paid early may not be reduced.
Payslips
When you retire, you will receive a payslip for your first month’s pension. You will then receive a payslip for March, April and May in each financial year, this is because these months represent the most changes The payroll section will additionally, send you a payslip if your pension changes by more than £5.
Tax
Her Majesty’s Revenue & Customs (HMRC) works out how much income tax you should pay and provides us with the tax code to be applied to your pension. You will need to speak directly to HMRC if you have any queries on this. You can contact them on 0300 200 3300. You will need your National Insurance number.
Change of details
We cannot accept change of address and change of bank details over the phone.
- change of address form
- change of bank details form (PDF, 115.19 KB) - you must complete, sign and return the change of bank details form before we can update your bank details
If you're moving overseas after retirement
We can continue to pay your pension to either a UK bank/building society, or directly overseas via Convera (formerly known as Western Union). Please contact us with your new details.
Rule of 85
View or download The rule of 85 facesheet (PDF, 141.31 KB).