InContact - issue 22
A newsletter for retired members of the Local Government Pension Scheme participating in the Staffordshire Pension Fund.
Welcome to our 2024 issue!
For many of us ‘embracing technology’ can be quite scary and that set me thinking about when some of the items that sit on my desk, and which I now take very much for granted, were invented:
Modern Pencil (1795) A4 Paper (1922) Ballpoint Pen (1938) Computer Mouse (1964) Pocket Calculator (1967) Mobile Phone (1973) Laptop (1981) and not forgetting the thing that keeps us all connected these days, the Internet (1983).
And now we find ourselves in the era of Artificial Intelligence (AI) which is described as ‘the intelligence of machines or software, as opposed to the intelligence of humans or other animals’. Is that even more scary, or just exciting?
For the Fund, embracing technology means always trying to do the day job more efficiently, and with an ever-increasing number of scheme members, we are encouraging everyone to help us to do that by looking at their pension details on-line.
Please have a go at registering for the My Pensions Portal (MPP). I’m sure in the next decade viewing our pension electronically will just be another thing that we all simply take for granted…like the humble pencil, invented all those years ago. But in the meantime, if you do have any questions or enquiries relating to your pension then don’t forget, the Pensions Team are always available to assist you.
Elsewhere in the world of Pensions, a raft of new legislation continues to keep the Administration, Systems and Governance teams busy, the Fund’s investments continue to perform well and at 31 December 2023, the Fund hit the £7 billion asset valuation milestone.
However, no matter how busy we all are, we never forget our primary objective of paying our members their benefits when they are due for payment, so please make a note of your pay-dates.
I hope you all continue to stay safe and well throughout 2024 and who knows in 2025, it may be a ‘chatbot’ writing this introduction!
With my kind regards and best wishes to you all.
Melanie Stokes
Assistant Director for Treasury & Pensions
The pension pay dates for 2024/25 are published on our web site.
Your Pension Payslip
In November 2023, a new Payroll software module was implemented into the Pensions Administration System. New Pensioner Payroll records are now automated resulting in significant efficiency savings from reduced manual input of data.
The only difference you may notice is a slight change to the look of your payslip. Please be assured that there will be no change to the way we calculate your pension.
On your new payslip, the description of the allowances will now include the suffix ‘M’ for your main pension record and suffix ‘S1’, ‘S2’ etc. for each subsequent, subsidiary pension record, if you have more than one pension in payment.
Tax queries
HM Revenue and Customs (HMRC) make the decision of what tax code to issue against each of your income sources in order for the correct tax deductions to be made.
Staffordshire Pension Fund cannot change your tax code without a revised coding notice from HMRC. 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 in any correspondence.
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.
Any Pensions Increase is normally paid to:
- Pensioners who are aged 55 or over.
- Pensioners who have retired for the reason of permanent ill health at any age.
- Spouses and dependants of former pensioners.
Unless the rate of inflation is zero or below, your Staffordshire Pension is increased annually in line with the Pensions Increase Order which is currently linked to the Consumer Prices Index (CPI). The increase is based on the September to September adjustment in the CPI.
The CPI index for the year up to September 2023 was 6.7%, therefore an increase of 6.7% will apply to your pension from Monday, 8 April 2024. This means your pension for April will only show a partial increase. The full increase will not apply until May. If applicable, the first increase to your pension after retirement (from active membership) will normally only be a proportion of the full increase, depending on how many months your pension has been in payment for the year.
| Pensions Beginning | Pensions Increase |
|---|
| Before 26 March 2023 |
6.70% |
|---|
| 26 March 2023 - 23 April 2023 |
6.70% |
|---|
| 24 April 2023 - 23 May 2023 |
6.14% |
|---|
| 24 May 2023 - 23 June 2023 |
5.58% |
|---|
| 24 June 2023 - 23 July 2023 |
5.03% |
|---|
| 24 July 2023 - 23 August 2023 |
4.47% |
|---|
| 24 August 2023 - 23 September 2023 |
3.91% |
|---|
| 24 September 2023 - 23 October 2023 |
3.35% |
|---|
| 24 October 2023 - 23 November 2023 |
2.79% |
|---|
| 24 November 2023 - 23 December 2023 |
2.23% |
|---|
| 24 December 2023 - 23 January 2024 |
1.68% |
|---|
| 24 January 2024 - 23 February 2024 |
1.12% |
|---|
| 24 February 2024 - 23 March 2024 |
0.56% |
|---|
| 24 March 2024 onwards |
0.00%
|
|---|
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 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 who were 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 non-contractual 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).
Staffordshire Pension Fund participate in the Cabinet Offices National Fraud Initiative (NFI): a data matching exercise to assist in the prevention and detection of fraud. The Fund may share details of pensioners and beneficiaries 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 involves comparing computer records held by one body against other computer records held by the same or another body. This is usually personal information, including contact details. Computerised Data matching allows potentially fraudulent claims and payments to be identified.
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 following Cabinet Office site www.gov.uk/government/collections/national-fraud-initiative
For further information on data matching at this authority contact David Fletcher, Internal Audit Section on 01785 895408 or by e-mail at david.fletcher@staffordshire.gov.uk
My Pension Portal (MPP) is a simple to use, secure and user-friendly portal. MPP provides you with round the clock access to your Local Government Pension Scheme (LGPS) records. This means you can:
- Stay up to date with your pension and access important documents, such as your Payslips and P60.
- Change and update your personal details, like if you move address.
- Submit enquiries via the portal e.g. to make request to change bank details.
If you have already registered for MPP you can view your pension benefits today by following this link:
https://www.staffspf.org.uk/Calculator/Self-Service-Calculator.aspx
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 on the Staffordshire Pension Fund website. The activation code will be sent to your home address (please allow up to 20 working days).
Dealing with Bereavement
We understand when a bereavement occurs it can be a difficult time.
In this article is information about death benefit entitlements and the process which occurs following the death of an LGPS Scheme Member.
How to notify the Pension Team
To tell us about the death of a Member, there is certain information the family or representative needs to provide. This includes the following information about the Member:
- Full name
- National Insurance Number
- Address
- Date of death
You can tell us about a death in 3 ways:
Please also provide your full name and the details of the Member’s next of kin, personal representative, or executor - the person dealing with the Member’s estate. This includes their name, address, email address and telephone number.
We will write to or email all relevant parties and enclose any necessary forms that need to be completed. These should be signed and returned by email or to our postal address.
Please note, our letter may also include details of any underpaid or overpaid amounts. Once the necessary forms have been returned to us, we will process any benefits that are due and notify all relevant parties when this is complete.
Further information is available on our website at:
https://www.staffspf.org.uk/Pensioners/Notification-of-the-death-of-a-retired-member.aspx
I would like to introduce myself as the new Pensions Recipient Co-opted Representative on the Pensions Committee. My name is Liz Staples, and I attended my first meeting of the Committee in September 2023.
I have previously worked for a Trade Organisation in the Transport Sector and later became a Sole Trader specialising in Drivers’ Hours Rules and Tachograph Legislation. As this allowed me to be more flexible with my time I became a Justice of the Peace, serving for 10 years. I was also an elected member on East Staffs Borough Council and later an elected County Councillor and it was during this time I joined the Local Government Pension Scheme.
Since retiring from working for the NHS and being a councillor, I volunteer with the National Trust; you can find me at Calke Abbey and also The Children’s Country House at Sudbury. I served for 4 years as an elected member of the National Trust Council and I am a Trustee and Treasurer for a local Village Hall, so I do like to keep active.
As a recipient of a LGPS pension, I was intrigued when the InContact magazine asked for people who might be interested in serving as a co-opted member on the Committee. I put my name forward, had an online interview and was successful in being selected.
Since joining the Pensions Committee, I have attended a 3-day Local Government Association Pension Fundamentals training course, which was held online. And a half day training session about the principles, and how, the performance of the Pension Fund’s many investments are independently measured and analysed.
I find the meetings are interesting and Officers and the Members of the Committee are very professional. The approach is always to focus on the long term and make the best decisions we can, without having a crystal ball to hand. Most recently, we have begun to discuss the Fund’s Investment Strategy and whether it might be appropriate to change it in the future, knowing that one size doesn’t fit all and that each employer who has members in our Fund will have their own unique set of circumstances that may require a different contribution and / or investment strategy. But of course, all that doesn’t affect the payment of our pension each month.
As has often been quoted “interesting times” and I look forward to continuing to be your representative on this important Committee.
If you have a question for Liz and want to contact her, then please email:
pensions.comms@staffordshire.gov.uk
Below shows the investment performance of the Staffordshire Pension Fund (‘the Fund’)in the financial year up to 31 December 2023. Although the Fund's performance is below that of its strategic benchmark, it has continued to grow and had a Total Market Value of £7.17bn at the end of the year.
This compares to a Total Market Value at 31 March 2023 of £6.2bn, illustrating the continued recovery in investment markets, since the uncertainty created by the pandemic
Fund performance versus benchmark 2023/2024
June 2023 quarter
September 2023 quarter
December 2023 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) - 6.6%
- Fund benchmark (annualised) - 5.7%
5 year
- Fund performance (annualised) - 8.4%
- Fund benchmark (annualised) - 7.9%
10 year
- Fund performance (annualised) - 7.9%
- Fund benchmark (annualised) - 8.0%
Staffordshire Pension Fund investments as at 31 December 2023
Below shows the breakdown of the different investments held by the Fund as at 31 December 2023. The Fund has a long-term Strategic Asset Allocation, which is approved by the Pensions Committee and reviewed quarterly by the Pensions Panel and their Investment Advisers. This is set to ensure that the Fund invests in a wide range of asset classes, which helps to reduce and diversify risk.
Whilst the Fund has a relatively high proportion of its investments in equities, it is beginning to diversify into alternative asset classes, such as Infrastructure, which will increase the Fund’s income whilst continuing to deliver the growth and return profile assumed in the Fund’s investment strategy.
- Global equities - 61.2%
- Corporate bonds - 7.4%
- Property - 7.4%
- UK index-linked gilts - 7.9%
- Private debt - 5.2%
- Private equity - 5.2%
- Cash - 1.4%
- Infrastructure - 4.3%
There are currently in excess of 500 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.
Contact details are available on the Fund's contact page.
If you wish to print out this information, please select the document below:
Change of bank account
If you change your account number or otherpayment details, please notify us as quickly as possible. This should either be:
When updating your bank account details, changes may not take effect until the following month due to the timing of running the payrolls.
Should your instalment of pension be returned to Staffordshire County Council by your bank or building society, payment of pension will be suspended until your whereabouts is known. Staffordshire County Council must be satisfied that the money which is intended for you is actually reaching you.
Change of address
If you change your address, please let us know as soon as possible as any correspondence returned to the Staffordshire Pension Fund will lead to your pension payment being stopped. You can let us know of your new address either:
Alternatively, if you have already registered to use the My Pension Portal system, you can make changes to you address via your online account (please do not attempt to register before changing your address in another way, as the registration process entails Staffordshire Pension Fund sending out an activation key to the home address we hold on our records).
Please note that we are not able to accept these changes by telephone.