NHS Pension Scheme A brief overview of NHS Pension Scheme

Topics Covered in this Presentation Guide to the Scheme Eligibility Contributions Age Retirement Benefits Ill Health Retirement Benefits Voluntary Early Retirement Draw Down Life Assurance and Family Benefits Increasing Your Benefits Transfer of Pension Rights Refunds

Guide to the NHS Pension Scheme A starter pack is given to all joiners including the guide to the NHS Pension Scheme You are automatically entered into the NHS Pension Scheme Two Sections of the Scheme from Section – Based on 80ths for scheme members at & re-entrants with less than 5 years break in membership Section – Based on 60ths for all new starters from & re-entrants with 5 years or more break in membership. Both sections provide index linked pensions Both sections are based on Final Salary

Eligibility Eligibility from ages 16 – 75 (although Trust retirement age is 65) Automatic membership Choice to Opt out of the scheme (SD 502)

Contributions New contribution rates New rates commenced 1 April 2008 and are same for both Sections Contributions linked to your earnings Rate of contributions dependant on full time earnings, or equivalent amount if working part time Employer will continue to pay 14%

New Contribution Rates Officer and Practice Staff Scheme members who have had a change in circumstances on, or after, the 1 April 2009 or who are new starters. The annual pensionable pay will be uplifted with AfC pay awards. Tier Annual Pensionable Pay (full time equivalent) – 2009/10 Contribution Rate in 2009/10 1Up to £20,7095% 2£20,710 to £68,3926.5% 3£68,393 to £107,8467.5% 4£107,847 plus8.5%

What Do You Get For Your Contributions Age Retirement Benefits Life Assurance Cover Family Benefits Ill Health Retirement Benefits Redundancy Benefits Voluntary Early Retirement Benefits

Age Retirement Benefits Normal retirement age is 60 for 1995 section (55 for special classes) & 65 for 2008 section 1995 Section – Pension & Lump Sum based on best of last 3 years pensionable pay with option to take an increased lump sum by giving up part of the pension 2008 Section – Pension based on average of the best 3 consecutive years in the last 10. No automatic lump sum but an option to give up some of the annual pension in exchange for a lump sum (forego £1 of annual pension (taxable) for every £12 of Lump Sum (non taxable) within stated limits)

Age Retirement Continued… Special Class Status 1995 section only; Special class status is given to the following groups providing they were in these groups prior to and they have not had a break in membership of 5 years or more. Female Nurses Health Visitors Midwifes Physiotherapists Male Nurses (membership from 17/5/1990 only) If you have special class status your Normal Retirement Age is 55.

Ill Health Retirement For Both Sections: Must have 2 years pensionable service to qualify 2 Tier arrangement Tier 1 – Unable to carry out current duties – can receive pension benefits accrued without enhancement – subject to abatement if re-employed in NHS Tier 2 – Unable to engage in any regular employment – can receive an enhanced pension & would be subject to abatement

Voluntary Early Retirement Voluntary Early Retirement (VER) is available to anyone over the minimum retirement age providing their pension exceeds the Guaranteed Minimum Pension (GMP) 1995 Section – Minimum retirement age is 50 except for members who joined the Scheme on or after , the minimum retirement age will increase from 50 to 55 from Section – Minimum retirement age is 55 Actuarial reduction in both sections

Draw Down 2008 Section Only; Option to take partial retirement from age 55 and take some of your benefits if you reduce your pensionable pay by 10% by; Reducing working time or switching to a less demanding role You can take between 20% and 80% of your pension entitlement and continue to build up future membership The benefits would be reduced if they are taken before your 65 th birthday Option to drawn down benefits twice before retiring completely

Life Assurance and Family Benefits From 1 st day of joining a Death Gratuity Lump Sum is payable equal to 2 years pensionable pay Survivor benefits for member’s with over 2 years membership Widow(er)s and Civil partner’s automatically recognised for benefits. Partner’s must be nominated for Lump Sum (DB2) & Pension (PN1) – (Forms available from myself and on the website. Financial interdependency for 2 years must be proven on the death of the member. Survivor’s benefits; Initial Survivor’s pension paid for 6 months through payroll for all members. Widow’s continuous pension based on all membership. Widower’s/Civil partner’s/Nominated partner’s continuous pension based on membership from Dependant/Child benefits may be payable Dependant child allowance paid until age 23 (subject to dependency rules).

Increasing Your Benefits Additional Pension – Increases scheme pension only but can be exchanged for lump sum at retirement. Bought in blocks of £250 annual pension up to a career maximum of £5,000. Option to include cover for dependants pension. Spread cost over 1 to 20 years, or pay a one-off lump sum contribution. Additional Voluntary Contributions (AVC’s) – Contributions invested in a separate fund used to buy a top up pension. Option to take up to 25% of fund as cash. NHS Scheme cannot guarantee the fund or pension it will provide. Special terms from appointed NHS Scheme providers but you can choose your own provider. Stakeholder Pensions – A type of personal pension. Contributions invested in a separate fund used to buy a top up pension. Option to take up to 25% of fund as cash. NHS Scheme cannot guarantee the fund or pension it will provide. Available through the NHS Scheme or choose your own provider. Continued…

Increasing Your Benefits cont….. Buying back previously refunded membership - If you had a refund of contributions for any membership before 6 April 1978, or for practitioners at any time, you may be able to buy this membership back at half the normal cost. Added years - Members of the 1995 section who took out or elected to take out an added years contract before 1 April 2008 may also be buying additional Pensionable Service. These contracts my continue whilst members are in the 1995 section. The option is no longer available for new contracts in either section Tax relief is normally available on contributions paid to any of the above top up options.

Transfer of Pension Rights Pensions can be transferred in/out of approved pension schemes Transfer in to NHS Scheme must be initiated within first 12 months of joining Transfer out – Contact the pension officer of new employer for information Before transferring out of the NHS Pension Scheme seek independent financial advice

Refunds If less than 2 years contributing membership a refund can be requested. (Form RF12 available from Pensions Office) All contributions will be repaid less Tax & NI adjustment

Pension Queries All NHS Pension queries should be addressed to: Joe Bloggs Senior Pensions Officer Any Hospital Trust Anywhere Road Freedom City Lostville T20 OWL Contact times: Monday – Thursday (7.30am – 4.00pm) Telephone: Fax: