FAQs

Absences

Answer:

This varies according to the reason for the absence as set out below.

  • Sick Leave

If you are absent due to sickness and you are receiving sick pay (even if this pay is reduced), your employer will deduct contributions from your pay so that you keep up your membership of the Scheme. If you are unpaid during this period, you do not pay any contributions. 

If you are in the Main Section of the scheme the pension you build up for the full period of sick leave will be 1/49th of the greater of your Actual Pay or your Assumed Pensionable Pay (APP) - see the FAQ on APP below. 

If you are in the 50/50 Section of the scheme, you will build up 1/98th of the greater of your Actual Pay or your Assumed Pensionable Pay (APP) during the period you receive pay. You will revert back to the Main Section of the scheme at the start of the next pay period after you start to receive no pay if you are still unpaid.

  • Unpaid Leave

If you take employer authorised unpaid leave, the pension you build up in the year of the break will only be based on the part of it when you were working and receiving pay. You can opt to pay extra contributions to make up any “lost pension” during your break. You can do this by paying Additional Pension Contributions (APCs), either as a one-off lump sum or as an ongoing deduction from your pay. These contributions would be Shared Cost APCs, which means that you would pay 1/3 of the cost and your employer pays 2/3 of the cost. You must make an election to pay these APCs within 30 days of your return to work. Details of the cost can be found on the National LGPS 2014 website.

If you are not paid for a period of unauthorised absence, this period will not count towards your pension.

  •   Dispute

If you are absent from work because of an industrial dispute the pension you build up in the year of the break will only be based on the period where you were working and receiving pay. You can opt to pay extra contributions to make up any “lost pension” during your strike break. You can do this by paying Additional Pension Contributions (APCs), either as a one-off lump sum or as an ongoing deduction from your pay. You must pay the full cost of these APCs. As the cost for a strike break is dependent on the age you are when you start to pay the APCs, you can pay these APCs at any time. Details of the cost can be found on the National LGPS 2014 website.

  • Maternity Leave

 

 Child-Related Leave

This leave is Maternity, Adoption or Paternity Leave.

Child-Related Leave is split into two periods – Ordinary and Additional, which each last for 26 weeks.

  • Ordinary Child-Related Leave

If you are receiving pay for this period, you will pay your normal contribution rate on the amount of pay you receive. If you are unpaid during this period, you do not pay any contributions.

The pension you build up for this period will be 1/49th (1/98th if you are a member of the 50/50 Section) of the greater of your actual pay or your Assumed Pensionable Pay (APP).

  • Additional Child-Related Leave

If you are receiving pay for this all or part of this period, you will pay your normal contribution rate on the amount of pay you receive. You will build up pension of 1/49th (or 1/98th) of the greater of your actual pay or your Assumed Pensionable Pay (APP).

If you are unpaid for all or part of this period, you do not pay your normal contributions and you will not build up any pension. You can opt to pay extra contributions to make up any “lost pension” during your break. You can do this by paying Additional Pension Contributions (APCs), either as a one-off lump sum or as an ongoing deduction from your pay. These contributions would be Shared Cost APCs, which means that you would pay 1/3 of the cost and your employer pays 2/3 of the cost. You must make an election to pay these APCs within 30 days of your return to work. Details of the cost can be found on the National LGPS 2014 website.

Considering retirement

Answer:

On retirement you will be given the opportunity to exchange some of your pension to receive a tax free lump sum.

You will be able to take up to a maximum of 25% of the capital value of your pension benefits as a tax free lump sum or, if lower, 25% of the lifetime allowance set by HM Revenue and Customs (HMRC) less an adjustment for the value of any other pension benefits you are already drawing.

For each £1.00 of annual pension exchanged you will receive £12.00 of lump sum.

You may not reduce your pension below your Guaranteed Minimum Pension (GMP).  This is the minimum legal pension we must pay you, and a notification of this amount will be sent to you from HMRC prior to state pension age – it will be shown as a “Contracted Out Deduction” on details of your state pension.

Answer:

The benefit you will receive will depend on when the benefit was built up in the scheme:

  • Before 31 March 2008

The benefit built up in this period is made up as follows:

Pension = 1/80 x Membership x Final Pay

Lump Sum = 3/80 x Membership x Final Pay

  • Between 1 April 2008 and 31 March 2014

The benefit built up in this period is made up as follows:

Pension = 1/60 x Membership x Final Pay

There is no automatic entitlement to a Lump Sum Retirement Grant.

  • After 1 April 2014

After the 1 April 2014, your benefit builds up each year (1 April to 31 March) and the rate it builds up at depends if you were paying into the Main Section of the Scheme or the 50/50 Section of the scheme (see Changing Sections of the Scheme).

For the Main Section, each year you will build up the following:

Pension = 1/49 x Pensionable Pay

For the 50/50 Section, each year you will build up the following:

Pension = 1/98 x Pensionable Pay

There is no automatic entitlement to a Lump Sum Retirement Grant.

Whenever your benefits built up, you are able to exchange pension for a (larger) lump sum (see FAQ below)

Answer:

The Normal Pension Age for the LGPS is State Pension Age, or 65 if later.  This is the age at which benefits can be paid without any reduction.  If you draw them after Normal Pension Age, your benefits will be increased in line with guidance issued by the Government Actuary.  Under tax rules, benefits must be paid before age 75.

You can retire voluntarily from age 55, but if you retire between age 55 and 60, your benefits will be reduced for early payment.  If you retire between 60 and Normal Pension Age, some or all of your benefit may be reduced (depending on how long you have been a member of the scheme and your age).

The LGPS contains special provisions for early retirement without reduction on grounds of ill-health or redundancy/efficiency and for flexible retirement (drawing your benefits while still employed).

Leaving the scheme

Answer:

Only if you leave the Scheme before you have 2 years membership. In this case, you will receive a refund of your contributions, less your share of the cost of buying you back into the State Second Pension (S2P). Your refund will be subject to pension scheme taxation which is currently 20%.

If you have transferred benefits into the Scheme from a scheme that does not allow a refund of contributions to be paid, you will not be able to take a refund of contributions, even if you have less than a total of 2 years membership. 

Answer:

There is a death grant payable equivalent to three years' Pensionable Pay; this cover is available from the day you join the Pension Scheme. You are able to nominate a beneficiary to receive this payment.

There are pensions payable to dependents too.

Please see our page on nominating a beneficiary for more details.

Answer:

Provided you have more than 2 years' total membership of the Scheme, or have had a transfer of pension rights pension rights into the scheme, you will have the choice of either transferring the pension entitlement you have accrued in the Staffordshire Pension Fund to another pension arrangement or keeping your accrued entitlement in the Fund as a "Deferred Benefit" until payment of that benefit becomes due.

Answer:

Any contributing member of the Scheme can opt out at any time. We would strongly recommend that you seek independent financial advice if you are thinking of opting out.

Please remember that some alternative pension schemes may not provide the same level of benefit.

To opt out you will need to complete an opt out form. You should either return this form to your payroll section or if directed on the form, to Pension Services.

Your option normally takes effect from the payment period after the option is received. For monthly paid members this will be the beginning of the following month. It is not possible to backdate this option, unless you opt out within three months of joining.

If you are thinking of opting out due to financial reasons, you may wish to consider joining the 50/50 Section of the scheme.

 

Answer:

At present, yes, you can transfer your Deferred Benefit or a Deferred Refund at any time from leaving the Scheme and up to one year before your Normal Retirement Date. The transfer payment is available for you to purchase benefits in:

  • a new employer's scheme
  • a buy-out policy from an approved insurance company or
  • a personal or stakeholder pension arrangement 

You are strongly advised to take independent advice before proceeding with such a transfer.

Miscellaneous

Answer:

You can purchase extra pension in the Local Government Pension Scheme by paying Additional Pension Contributions (APCs). You could also consider making payments to the scheme's Additional Voluntary Contributions (AVCs) arrangement or even make payments to a Personal Pension, Stakeholder Pension or Free -standing AVC scheme of your own choice.

Please see our booklet "Ways of increasing your pension benefits".

Answer:
Your employer makes a contribution to the pension fund as determined by the Fund's Actuary. Your employer's contribution is reviewed every three years.  
Answer:

The level of contributions you pay is dependent on your Pensionable Pay. In the Main Section of the scheme, the lowest rate is 5.5% of your pay and the highest rate is 12.5%. However, in real terms it will be less than that because your contributions will attract tax relief. This means your pension contributions are deducted from your salary before you pay tax. In most cases you will also pay reduced national insurance contributions.

Please see the Contribution Rates page for further information about the rate banding.

Answer:

Pension Services will need to contact your former pension provider and ask them for a current 'transfer value' of the benefits held in their fund. No formal transfer will take place until Pension Services have written authority from you that you wish the transfer to proceed. An application to investigate a transfer must be made within 12 months of joining the LGPS.

Answer:

If you were a member of the scheme before 31 March 2014 you built up membership in the scheme, which is used to calculate your pension (see How much will my pension be?).

Membership is the calendar length of your service, but if you were part time this is pro rated by your part time hours.

For example:

A member worked whole time for 2 years. They built up 2 years membership of the scheme.

If the member had worked half time (18.50 hours a week out of a standard 37 hours) for the same 2 years, they would have built up the following membership:

2 years x 18.50 / 37.00 = 1 year 

If a member had worked term-time, their membership will be reduced in accordance with the number of paid term-time weeks for which they are employed. For example, if a member works half time (18.50 hours a week out of a standard 37 hours) for 45.22 paid weeks a year, their membership over 2 years would be calculated as follows:

Firstly, reduce contractual hours by paid term-time weeks: 18.50 x 45.22 / 52.14 = 16.04

Then their membership is calculated as follows:

2 years x 16.04 / 37.00 = 316 days

Membership is calculated on a day to day basis for benefits that built up before 31 March 2014, so any earlier full-time service will always be protected

Answer:

Yes you will. Being a member of the Local Government Pension Scheme does not affect in any way your entitlement to the basic state pension. However, whilst you remain a member of the Local Government Pension Scheme, as with all pension schemes that are 'contracted out', you will not be contributing to the additional element of the State Pension known as the State Second Pension (S2P). This element used to be known as SERPS.

More details regarding your state pension can be found at The Pension Service website, please see our Other Useful Sites page.

Answer:

Pensionable pay is the total of your actual salary plus pay received for overtime, additional hours, and any other allowances or emoluments that your employer deems to be pensionable (that will have contributions taken on them). The following payments are specifically excluded from pensionable pay: travel or subsistence allowances (including mileage claims); payment for loss of holidays; Payment in Lieu of Notice; any payment that is not subject to income tax.

The pensionable pay received in each scheme year (1 April to 31 March) will be used to calculate your pension for that year.

Answer:
There are no defined periods and, as different organisations [eg: employers, pension providers, NI Contribution Agency] may need to be involved, some transfers can take a longer time to complete. 
Answer:

If you have membership of the LGPS before 31 March 2014, Final Pay will be used to calculate the pension (and lump sum if applicable) for that part of your benefit.

The definition of Final Pay is very similar to Pensionable Pay, although there are two exceptions: Non-contractual overtime and additional hours are not included as part of Final Pay.

In addition, while Pensionable Pay is based on the actual pay received, for Final Pay, the calculation is based on a Whole Time Equivalent Rate, even if the member only works part time.

Answer:

Assumed Pensionable Pay (APP) is used to calculate the pension benefit payable where a member receives reduced or no pay due to sickness absence, child related absence or Reserve Forces leave. It is essentially the pay you would have received had you been at work.

Your employer calculates this figure by looking at the amount of pay you received in the 3 months before your pay started to be reduced.