Following the introduction of the Career Average Revalued Earnings (CARE) scheme for the LGPS from 1 April 2015 a number of protections are in place for those individuals in the scheme on 31 March 2015. These are summarised below:
Everything you have built up in the LGPS to 31 March 2015 is fully protected. So you won't lose out on any of the previous benefits you have earned, or the date that you would have expected to be able to receive them without reduction. Only the benefits you build up in the LGPS from 1 April 2015 onwards are based on the rules of the new scheme.
All benefits built up in the LGPS to 31 March 2015 will be calculated using your final pay (as defined in the LGPS as at 31 March 2015) when you eventually leave the scheme or retire. As a result you will receive the benefit of all future pay increases and promotions when assessing the final pay to be used in calculating your pre 1 April 2015 LGPS benefits.
If you leave the scheme before your normal retirement age with a deferred retirement benefit your benefits will increase each year in line with the cost of living.
If you subsequently re-join the scheme at a later date and aggregate your periods of scheme membership, provided you do not have a break in membership of more than 5 years from any public service pension scheme (e.g. the teachers, NHS, civil service schemes), any pre 1 April 2015 LGPS benefits will be calculated on your final pay when you eventually leave the scheme or retire.
If any break in membership from public service pension schemes is more than 5 years, and you decided to aggregate periods of LGPS membership, any pre 1 April 2015 benefits would not be covered by the final pay protection but would instead be converted to a CARE benefit in the scheme.
Your normal retirement age of 65 is protected for any benefits you have built up in the LGPS to 31 March 2015. The benefits you build up in the scheme from 1 April 2015 will of course have a normal retirement age linked to the State pension age, which over time will be later than age 65.
Any rule of 85 protections continue to apply from 1 April 2015 in most circumstances. The only time it won't apply automatically is where you decide, with your employers consent, voluntarily to take your LGPS benefits on or after age 55 and before age 60. In this situation your employer can choose to apply it if they so wish.
As the rules governing the rule of 85 are complex you should contact your Fund administrator for details of how it may apply to you.
The Government announced specific protections for any individual who retires from the LGPS with immediate entitlement to benefits and was within 10 years of age 65 on 1 April 2012 This protection is known as the "statutory underpin". The statutory underpin calculation will ensure that you will receive a pension no less than had you continued in the old scheme.
There are also other conditions -you must:
If the statutory underpin applies to you, at the point you retire a comparison will be made between the benefit you could have received had the scheme not changed from 1 April 2015 and the benefits you would be expected to receive as a result of the new scheme (if you are in the 50/50 scheme it's the pension you would have earned in the full scheme used in the underpin calculation). If the benefit you would have expected to get had the old scheme remained is greater the difference will be added to your pension.
If you are purchasing additional membership, buying back previous periods of part time employment, purchasing additional pension via an ARC or additional survivor benefits via an ASBC immediately before 1 April 2015 these contracts will continue from that date under the same terms.
Similarly, if you are paying additional voluntary contributions (AVCs) these will also continue on the same terms as before.