1. UNISON Scotland Dave Watson Head of Bargaining and Campaigns Scottish LGPS 2015 Ballot Scottish Local Government Pension Scheme

2. UNISON Scotland Background  UK Public Service Pensions Act  CARE scheme  Pension age linked to state pension age  Cost capping  Negotiation strategy  Focus on main benefit – accrual rate  Keep contributions stable - Pay restraint, economy, NI contributions 2016  Strengthen governance of funds

3. UNISON Scotland Career Average Revalued Earnings  Final salary scheme based on salary in final year(s)  CARE – pension pot each year  Retains commutation at £12 for every £1 of pension  Generally fairer - CARE spreads scheme benefits  Key issues:  Revaluation of annual ‘pot’ by CPI  Accrual rate  Only applies to pensions earned after April 2015

4. UNISON Scotland

5. Accrual Rate  Main factor in setting cash amount of pension  Current Scottish LGPS – accrual rate 60ths  Typical public sector CARE scheme 50ths  E&W LGPS - 49ths  New Scottish LGPS – 49ths  Comparison with E&W  Higher cost ceiling and mortality rate  Balanced by better benefits, ill health, death in service & age profile

6. UNISON Scotland Contribution bands unchanged No change to five-tier employee contribution rate structure, delivering an average employee contribution rate of 6.3%. Tiers operate on a banding system, like income tax (not cliff edge), as follows: Part-time contributions at actual not WTE salary Pensionable payRate (%) On earnings up to and including £19,8005.5% On earnings above £19,800 and up to £24,2007.25% On earnings above £24,200 and up to £33,5008.5% On earnings above £33,200 and up to £44,2009.5% On earnings above £44,20012%

7. UNISON Scotland Other elements  Pensionable pay = total pay up to full time  Part-time workers regularly doing additional hours  Still excludes non-contractual overtime over normal full time working  Pay less, get less 50:50 option  50% contributions, 50% accrual rate  Contingent dependents benefits & death in service not affected  Aim to attract new members (1/4 workforce not in), but review 2017  Ending requirement to nominate cohabitee  Civil partners treated as married  Other benefits unchanged

8. UNISON Scotland Transitional protections  Pensions in payment or deferred no change in benefits  Rule of 85 transitional protection to 2020 retained  Final salary at April 2015. Pension on last year of service  Underpin for members within 10 yrs retirement at 2012  Accrued benefits pre-2015 & CARE added together and compared with what would have got under final salary. Better of two.

9. UNISON Scotland Governance  Scheme Advisory Board  Statutory SLOGPAG  Pension Board at fund level  One or two boards  Review fund structure  Separation from local authorities  Number of funds in Scotland or shared services to cut costs  Cost control – 2% cap

10. UNISON Scotland Next Steps  Initialed draft Heads of Agreement  Ballot paper issued 16 October  Ballot closes 7 November  Leaflet and recruitment initiative  More detail on web site  Regulations. Consultation and parliamentary process  Implementation April 2015  Joint communications