InContact - issue 19
A newsletter for retired members of the Local Government Pension Scheme participating in the Staffordshire Pension Fund.
Welcome to our Spring 2021 issue!
I remember sitting down to write the Welcome to In-Contact last year and commenting on how I was "….looking forward to the new 'Roaring Twenties'." I'm not quite sure they quite got off to the start that I was hoping for, but 2020 will certainly go down in history for so many reasons, many of which, when associated with the pandemic, we may decide to simply forget.
2020 was a year of great distress and suffering for all of us and so many of us will have lost loved ones too. And whilst we may reflect on that with great sadness, I sincerely hope that we have reached this point in 2021 with a new and different hope and that we can be optimistic that there is light at the end of the tunnel. I also hope that when we do emerge from the tunnel, we can find time to be thankful once again for the things in life that are important to us: our health and our family and our friends. And not forgetting our pension, of course…
In this edition of In-Contact, as well as the usual information about pay dates, pensions increase and the Fund's investments, we have included an article on the beautiful Cannock Chase. I consider myself very lucky to live close to the edge of such an amazing area of outstanding natural beauty, where a walk along the same path can be like a different walk every day. And the Chase not only provides an abundance of nature and fresh air to enjoy, but it also has all that history too. If the weather is still too bad to visit the Chase in person, then why not just ‘google’ it, to find out more?
My assumption last year that "…the year to come will be no less busy" for the Pensions Team did prove correct. We have been extremely fortunate that the majority of us have been able to work from home during the pandemic and whilst there were some practical things to sort out initially, we did so relatively quickly, and it was business as usual thereafter. Although we are not in the office at the moment, we are still a team of dedicated Pensions officers ready and waiting to assist you with any queries or questions you might have, or even listen to any suggestions as to how we might improve our service to you. The ways you can contact us are on our site.
I hope that you enjoy reading this issue of InContact and find the various articles useful. And I also hope that you continue to stay safe and well throughout 2021.
With kind regards and best wishes to you all.
Melanie Stokes
Head of Treasury & Pensions
The pension pay dates for 2021/22 are published on our web site.
Tax queries
If you have a query on your tax code please phone 0300 200 3300, where a member of staff from HMRC will be able to assist you.
Please quote your National Insurance Number and the tax code reference 586/PENS.
Unfortunately, Staffordshire Pension Fund are unable to help you with tax queries.
Tax thresholds
Details on tax thresholds can be found on our website.
All public service pensions (of which the Local Government Pension Scheme is one) are adjusted each year to reflect changes in the cost of living index. This is sometimes called inflation proofing or index linking. The LGPS offers full index linking to pension benefits, i.e. there is no upper limit or capping on the amount by which benefits will be adjusted in times of high inflation.
Further information is available on our site.
Staffordshire Pension Fund has received quite a few calls about the letter many members approaching state pension age have received from HMRC, which tells them to contact us. Hopefully the information below will provide you with some clarification.
As part of the changes to the State Pension introduced in April 2016 the Department for Work and Pensions (DWP) introduced a term called contracted-out pension equivalent (COPE).
COPE is an estimated amount for those who were previously 'contracted-out' of the additional State Pension to see how National Insurance (NI) contributions paid before 6 April 2016 will contribute to their overall pension income.
Members of the Local Government Pension Scheme (LGPS) were 'contracted out' of the additional State Pension and paid lower National Insurance contributions. So to take into account that LGPS members have paid less into the NI system, the amount of State Pension they'll get directly from the government will be lower than that received by people with similar earnings who were not contracted-out.
While those individuals contracted-out may not be entitled to the full amount of the new State Pension, they will instead receive some of their pension income through a different route. In most cases, their occupational or personal pension scheme(s) should include an amount that is at least equivalent to the additional State Pension they would have got if they hadn’t been contracted-out. This is known as the COPE amount.
The COPE amount is now included on State Pension statements. However, the COPE is an estimated figure and has no direct relation to the benefits paid by individual pension schemes, including the LGPS.
If you look at your own State Pension forecast, it states what your State Pension is likely to be when you reach state pension age and then what your COPE amount is separately. The COPE figure is only an estimated figure and is not actually deducted from the State Pension. Since 5 April 2016 an individual's National Insurance record is used to calculate their starting amount and then each year from then on they build up an entitlement to the new State Pension.
The COPE is a single figure covering all of an individual's contracted-out membership, so where a member has had contracted-out membership in more than one pension scheme (or more than one pension fund), it is possible that a person's LGPS pension will appear lower than the COPE.
The Local Government Pension Scheme (LGPS) was a 'contracted-out' pension scheme. This means that you paid a lower amount of National Insurance contributions than someone doing exactly the same job as you, but who wasn't paying into the LGPS. This is because you were only paying for your basic State Pension and not paying for the additional State Pension (between 6 April 1978 and 5 April 1997). This was called the state earnings related pension scheme or SERPS.
If you were a member of the scheme between 6 April 1978 and 5 April 1997 and attained state pension age before 6 April 2016, Staffordshire Pension Fund must guarantee that when you attain state pension age your local government pension is at least equal to the additional pension you would have received with the state retirement pension if you had been in SERPS. This rate is known as the guaranteed minimum pension (GMP).
You may have been notified of this amount by HM Revenue and Customs under the title 'contracted out deduction'. Most of the time, the pension we pay is larger than the GMP, but in a very few cases (especially where a member did a lot of noncontractual overtime) the GMP may be larger than Staffordshire Pension Fund's payment. If the GMP is larger, then Staffordshire Pension Fund will increase the pension we pay to match the rate of the GMP.
A GMP consists of two elements:
- one in respect of any scheme membership between 6 April 1978 and 5 April 1988 (Pre 1988)
- the other in respect of any scheme membership between 6 April 1988 and 5 April 1997 (Post 1988)
The GMP is paid as part of your pension benefits, not as an addition. The application of GMP to your pension benefits means that pensions increase (inflation proofing) will be added to your pension benefits in a slightly different manner.
Staffordshire Pension Fund is responsible for full pensions increase on the pension excluding the GMP elements and is responsible for a maximum of 3% pensions increase on the part of your GMP which accrued after 6 April 1988. Any pensions increase above 3% on the Post 1988 GMP and the whole of the Pre 1988 GMP is the responsibility of the State and will be paid to you as part of your state pension benefits.
When you receive your first payslip after the application of a GMP or, if you are already over state pension age, your next payslip in April, you will see that your pension can be broken down into up to 3 allowances:
Ordinary basic pension
This is the starting rate of your pension.
Pensions increase
This is the pensions increase that applies to the part of your pension that is not GMP.
Post 88 GMP PI
This is the Pensions Increase payable on the part of your GMP that accrued after 1988 (limited to 3% per year).
Being worried, low or out of sorts aren’t just part and parcel of getting older - they’re important signs that you’re not feeling as well as you should be.
Our mental health affects how we think and feel, and how we cope with life's ups and downs. As we move through different stages of life and our circumstances change, our mental health can change too.
We've all faced a lot of challenges this year. You may have found your own ways of coping, but it's also natural to feel overwhelmed by it all. If things are starting to get on top of you, you don’t need to try and cope alone. There is support out there that can help.
Our mental health is more important than ever - particularly because how we're feeling mentally can have a big impact on how we feel physically. If you're finding things tough and it's affecting your mood and how you feel, then speaking to your GP is good place to start.
Talking about your mental health can be daunting, but your GP will be used to having these conversations and won't judge you. They are there to help and will know what to do.
Because of coronavirus, you might be worried about bothering your GP or going into the surgery - but how you're feeling mentally and emotionally is still a priority. Support is available and can be given over the phone too.
Over the past months we've been spending a lot more time apart from our family and friends and have had to stay at home more than we normally would. This has meant big changes to our normal routines, so it's important we look after our physical as well as our mental health.
There are some things you can do that can help you feel better both physically and mentally.
Sleep
Sleep patterns change as we get older and lack of sleep can directly affect the way we feel. If you're having difficulty sleeping, try cutting back on daytime naps and reduce the amount of caffeine you drink. Try to make time to relax and unwind each evening.
Eat well and drink sensibly
What we eat and drink affects how we feel. Try not to fill up on the wrong things, but also don't ignore any signs you may not be eating enough, such as losing weight.
Exercise
As well as keeping you healthy, exercise is a great way to improve your mood as it increases the production of endorphins - brain chemicals that make you feel happy. It can also be a good way to clear your mind and relax. It's never too late to get active.
For many years Cannock Chase Forest has enjoyed a reputation as the forest playground of the West Midlands. The stresses and strains, both physical and mental, of the coronavirus pandemic have served to cement the forest's place in the hearts of people in the region.
Offering a place to let off steam and exercise, appreciate the beautiful natural environment, or simply to enjoy a fabulous walk with the grandchildren or your four-legged friend. The public have found getting outdoors in such a beautiful place a vital escape from day-to-day life.
Cannock Chase Forest has a rich history, it was a medieval royal hunting forest and later was host to two WW1 camps. After the Great War in 1920 the newly formed Forestry Commission planted swathes of trees and today the forest is an important source of timber for the nation as well as being a leisure destination. Stacks of logs destined to be made into fencing, pallets and even bio-fuel to keep NHS hospitals warm, are a common sight.
Although it's busier at weekends it's easy to find some solitude on the paths and trails of the stunningly beautiful Cannock Chase Forest during mid-week visits. There's something for everyone whether you have an appetite for a longer walk or a short woodland wander.
The one-mile long Ladyhill trail is a great starting point and it's also wheelchair accessible.
The forest is a haven for cyclists and attracts mountain bikers from across the region. Don't worry though, it's not all about hilly, challenging routes, there's lots of opportunities for a more leisurely pedal through the trees. The traffic free trails are just the job for those of us who've not ventured out on two wheels for years. There's a cycle shop on site that (Covid regulations permitting) also offers a bike-hire service.
Although temporarily closed during the national lockdown the on-site Grounds Café offers a very welcome pit-stop. There's an enticing range of savoury dishes and snacks, the obligatory selection of delicious cakes as well as good range of beverages including excellent barista-brewed coffee.
It's clear that many of the thousands of new visitors to Cannock Chase Forest during the pandemic have formed a new habit that looks set to last a lifetime. If you've not visited yet, why not see what a visit to this beautiful landscape on your doorstep can do for you and your well-being?
In our last edition of InContact we explained that you could now use the My Pension Portal to access your pension details.
Many of our retired members have now signed up to the service whichprovides access to:
Payslips and P60s
See your payslip and P60 information.
Check and update your personal details
If you've not already registered for My Pension Portal and want to do so, you will first need to apply for an activation code.
Once you have an account and are logged in, from the My Pension Portal dashboard you can click on any of the boxes, to be taken to the relevant area.
During the next 12 months, we plan to contact all retired members not yet signed up, to provide guidance on the sign-up process to encourage everyone to register.
Previously it was our intention to stop posting payslips from April 2021, however we have decided to continue to send these by post for the next 12 months to allow more time for retired members to sign up to MPP.
As well as payslips, P60s will also no longer be sent by post, after April 2022, unless you notify us otherwise, in which case we will be happy to issue both in paper format. You will need to put your request to continue to receive posted payslips and P60s in writing to Staffordshire Pension Fund (if you have already done so there is no need to contact us again).
Contact us
If you have already registered for MPP you are welcome to contact us.
The investment performance of the Staffordshire Pension Fund (the Fund) in the financial year up to 31 December 2020 is shown below.
The Fund has performed above its strategic benchmark to date and has a total market value of £5.9bn. This compares to a total market Value at 31 March 2020 of £4.7bn and illustrates the recovery in investment markets, since the initial uncertainty created by the pandemic.
Fund performance versus benchmark 2020/2021
June 2020 quarter
September 2020 quarter
December 2020 quarter
Financial year to date
Annual Fund performance versus benchmark
Over the longer-term, the Fund has outperformed its strategic benchmark over the 3, 5 and 10 year periods. This can be seen below, which shows above benchmark annualised returns for each time period.
3 year
- Fund performance (annualised) - 6.8%
- Fund benchmark (annualised) - 6.6%
5 year
- Fund performance (annualised) - 10.1%
- Fund benchmark (annualised) - 9.9%
10 year
- Fund performance (annualised) - 9.0%
- Fund benchmark (annualised) - 8.5%
Staffordshire Pension Fund investments as at 31 December 2020
Below is the breakdown of the different investments held by the Fund as at 31 December 2020. The Fund has a long-term strategic asset allocation, which is agreed in consultation with the Fund's investment advisors and reviewed quarterly by the Pension Panel. This is set to ensure that the Fund invests in a wide range of asset classes, which helps to reduce and diversify risk.
The Fund has a high proportion of its investments in equities, as over the longer-term they are forecast to generate higher returns than other assets classes, such as government bonds.
- UK index-linked gilts - 7%
There are currently in excess of 450 employers contributing to the Fund. further details of which can be found within the Staffordshire Pension Fund annual report.
Please note: the performance and value of the Staffordshire Pension Fund's investments does not affect the value of your pension or the amount of pension that we pay you each month.
Phone scams are a common way for criminals to con people out of money. Be aware of some of the most common phone scams and find out what you can do to stay safe.
What is a cold call?
Cold calls are phone calls from companies trying to sell you something, even though they have had no business with you previously. Cold calls aren’t usually illegal and don’t necessarily count as a scam although they can be annoying, frustrating and even frightening.
Even though it won’t necessarily block scammers, you can register for free with the Telephone Preference Service (TPS) to reduce the number of cold calls you receive.
What are some common types of phone scams?
It can be hard to tell the difference between a scam and cold calling. However, it’s good to know some of the typical tricks that scammers use so you can be prepared.
Bank scams
Someone may call claiming to be from your bank telling you there's a problem with your card or account. The caller will often sound professional and try to convince you that your card has been cloned or that your money is at risk.
They may ask for your account and card details, including your PIN number, and even offer to send a courier to collect your card. They may also advise transferring your money to a 'safe account' to protect it.
This is a common scam and your bank would never ask you to do this.
HMRC scams
You may get a call from someone claiming to be from HMRC saying there is an issue with your tax refund or an unpaid tax bill. They may leave a message and ask you to call back. Again, don’t be fooled by this. HMRC would never contact you this way and would never ask you to reveal personal financial information such as your bank account details.
Staffordshire County Council is required by law to protect the public funds it administers. It may share information provided to it with other bodies responsible for auditing or administering public funds or where undertaking a public function in order to prevent and detect fraud.
Data matching
Data matching involves comparing records held by one body against other records held by the same or another body to see how far they match. This includes personal information and contact details. Computerised data matching allows potentially fraudulent claims and payments to be identified. Where a match is found it may indicate that there is an inconsistency which requires further investigation. No assumption can be made as to whether there is fraud, error or other explanation until an investigation is carried out.
We participate in the Cabinet Offices National Fraud Initiative (NFI). This is a data matching exercise to assist in the prevention and detection of fraud. These exercises run in alternative years. We are currently reviewing the resultant matches that were released in January 2021.
The use of data by the Cabinet Office in a data matching exercise is carried out with statutory authority under its powers in part 6 of the Local Audit and Accountability Act 2014. It does not require the consent of the individuals concerned under the Data Protection Act 1998 or the General Data Protection Regulation which came into force in May 2018. Data matching by the Cabinet Office is subject to a Code of Practice. Further information on the Cabinet Office’s legal powers and the purpose of the NFI can be found on the Cabinet Office site. www.gov.uk/government/collections/national-fraud-initiative
Further information
For further information on data matching at this authority contact:
David Fletcher, Internal Audit Section:
Contact details are available on the contact page.
If you wish to print out this information, please select the document below:
What a twelve months it's been since the last edition of this magazine. I do hope you and your family and friends have kept safe and well during this time and will continue to do so.
Although the Pensions Committee couldn't meet in person, we've still been busy with virtual meetings and everyone accessing them from home. At our most recent meeting, we discussed the Pension Fund investment performance for 2019/2020 and despite lower valuations at the end of March 2020, I am pleased to report the Fund is doing very well again now. The committee also attended a virtual training day, to enable us to keep up to date with current pension issues, of which there are many.
On the subject of investment performance, I would like to continue to reassure you that your pension will still be paid regardless of how the Fund’s investments perform. The Pension Fund is invested in a range of asset classes in order to diversify risk and provide more stable returns and this has certainly helped to provide positive performance during the pandemic. You will find an article on the Pension Fund's investments in this edition of InContact, which I hope you will find of interest.
Staff across the Pensions Team have all been working mainly from home and have continued to be able to provide a good service to anyone who has needed to contact them about their pension. I am sure they will continue to do so going forward.
Let’s hope this pandemic is improving over the next few months and we can all start to get back to normal as soon as possible.
Phil Jones