Communities for local Government

Welcome to the new-look forum for the new-look Local Government Pension Scheme!

Thank you for taking the time to register and look up our pages.  We will be continuing the lively debate that we've been having over the past months, dealing with queries and questions about every aspect of the LGPS. To review the discussion so far, please download the PDF document of the discussion to date  (PDF 70 Kb) or link to our original site at http://forum.communities.gov.uk/lgps2, but please be aware you won't be able to post a comment here.

Please note that the same rules as the last forum still apply, along with a couple of new ones. This means that we can not answer posts relating to specific cases - these are best directed to your local authority pension manager.

Take a little time to familiarise yourselves with the new discussion board and we look forward to receiving your posts.

Charlotte (Moderator) and the LGPS Team

Please can you confirm that my thinking is correct regarding what the intention is for banded contributions...

Employers will need to look at salaries at the start of an employment, look at the basic full time equivalent salary, estimate any extras, and apply the appropriate contribution banding. The banding must be reassessed every 1 April, and may be reassessed if there is a change in contract, at the employers discretion.

Have I got this correct?

What if the employer gets the estimate wrong, and the actual earnings at the end of the year are much different? Does the employee have the chance to appeal?

What if someone is getting protected pay at 1 April but it is expected to end?

Should extras be included for someone who is on sick or maternity pay at the assessment date?

Can you say when the actual regulations confirming the above are expected to be laid?

According to the LGPS web site, deferred benefits are normally payable at age 65 or from your normal retirement date if you left the scheme before 1 October 2006. From this it is not clear if benefits deferred after 1 October 2006 will have the same protection with respect to the 85 year rule as current members. I would be grateful for clarification on this matter.  

Deferred benefits

 

For no actuarial reduction to apply at all to deferred benefits they have to be taken at 65. However all scheme members have the right to ask for early release before 65 and many have the right to take rights at age 60 with no actuarial reduction being applied. Over time if a deferred members asks for early release of pension before 65 it is possible for no actuarial reduction to apply to pension rights built up before April 2008, but a reduction could be applied to rights building up after April 2008. This will depend on whether or not the deferred member comes within the group with protected rights.

Contribution Bands

 

Employers will attribute a person to a contribution band based on advertised starting salary, and will have the right to re-attribute a pay band on change of contract or changes in pay where and when this is reasonable.

If a pay addition is due to end an employer must decide whether it is reasonable to include this when attributing a band. Since these decisions are called first instance decisions there is a right of appeal, but it is not envisaged that employers will recover or refund contributions where they can demonstrate the original decision was reasonable.

In order to continue to accrue membership, contributions have to be paid on the level of earning determined by the employer, and in the case of nil pay this would normally be the amount being received immediately prior to this.

In Circular 198 Terry Edwards said:-

"CLG have confirmed that an individual will only change bands during a year if he / she changes employer. The new starting pay will determine the band for that job for the rest of the year with that employer."

You are now indicating this is not the case. If all employers in each pension fund have to decide whether to revisit the contribution band when there is a change of contract etc this will require much more organisation than if there is no decision to be made and just one band per year (unless changing employers). I think we need something more solid. All authorities should be written to so that they can make the necessary preparations.

 

What is the position of existing members who have a protected pay certificate issued prior to 31 march 2008 when the New Regulations are in force?

Responses to fibbot and mikew1’s queries are below:

 

Fibbott (05.10.07)

Circular 198 was written by the LGE in May 2007.  Between publication of the circular and the release of the full consultation document in June, a small number of changes took place.  These changes came about after a series of discussions between the department and LGPS stakeholders.  Regulation 3 has been amended to take into account the input of these stakeholders.  The covering letter of the 22 June consultation document explains that ; “Any changes in contractual terms subsequent to first joining will mean the employer can re-attribute the specific payband (upwards or downwards)...”

 

Mikew1 (09.10.07)

All certificates of protection for employees issued up to and including 31 March 2008 will be valid in the new Scheme.

 

Please note that the forum will be closed and archived on Friday 9 November.  The preserved LGPS dicsussion forums will still be able to view through the archive site and the LGPS website: www.communities.gov.uk/lgps.

 

Charlotte and the LGPS Team

 

IMPORTANT NOTICE

 

Please note that the LGPS discussion forum will close on Friday 9^th November 2007.  This means that the deadline for posting new queries will be Wednesday 7^th November 2007.

 

The forum and its two predecessors have proven to be extremely useful to stakeholders and officials over the last twelve months.  Indeed, the contributions you have made have helped create one of the department’s most successful discussion forum to date.

 

All three forums will be accessible via the archive section of the “Have Your Say” pages or through the LGPS home page: www.communities.gov.uk/lgps.

 

CLG intends to continue issuing regular Scheme updates to managers which will ensure that they and all Scheme members are informed of any new developments.

 

Thank you all for your contributions to all three forums.

 

Kindest regards

Charlotte and the LGPS Team

The LGPS discussion forum is now closed.

 

The forums have provided stakeholders and the department with an effective and valued means of communication over the past twelve months.  In recognition of the importance of having good communication links between the department and stakeholders, pension managers will be supplied with regular updates in the future with the expectation that these will be distributed amongst Scheme members.  These updates will also appear on the LGPS website www.communities.gov.uk/lgps.

 

We would like to thank everyone who has contributed so helpfully to the forums.

 

Best wishes

Brian on behalf of Charlotte and the LGPS team