All About Your Scheme 2019

All About Your Scheme 2019 booklet.
qxp_Layout 1 04/09/2019 11:10 Page 1
West Midlands Pension Fund
A GUIDE TO THE
LOCAL GOVERNMENT PENSION
SCHEME FOR EMPLOYEES
IN ENGLAND AND WALES
EMPLOYEES IN ENGLAND AND WALES: MAY 2019
VERSION 5.1
All About Your Scheme 2019 booklet.qxp_Layout 1 04/09/2019 11:10 Page 2
All About Your Scheme 2019
Contents
About This Booklet Your Pension

• How is your pension worked out?
About the Local Government • What options do I have when I draw
Pension Scheme (LGPS) my benefits from the scheme?
• Who runs the LGPS? • What if I am paying extra?
• LGPS rules and responsibilities • When can I retire and draw my
LGPS pension
Your Pensions Choice • Voluntary retirement
• Joining the LGPS • Choosing to retire and draw your
• Contributions pension benefits before your
• Forms to fill in normal pension age
• Reductions for early retirement
Contribution Flexibility • Choosing to carry on working after
• Flexibility to pay less - 50/50 section your normal pension age
explained • Early retirement through redundancy
• Flexibility to pay more including: or business efficiency
- additional pension contributions • Ill-health retirement
(APCs) and • Flexible retirement
- additional voluntary contributions • Your state retirement pension
(AVCs)
• Contributing to a concurrent personal Transferring Pension Rights
pension plan or stakeholder pension into the LGPS
scheme • If you have previous LGPS pension
• I am already buying extra LGPS rights in England and Wales
membership and or paying additional • If you have pension rights in a
regular contributions (ARCs). Can I buy non-LGPS arrangement
any extra benefits? • If you have pension rights with another
• Can my employer award me any extra public service pension scheme where
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pension benefits? Club transfer rules apply

• What happens if I pay extra and elect • I have a personal or stakeholder
for the 50/50 option? pension plan. Can I continue paying into
• What if I'm paying extra and I am it?
absent from work? • I have paid additional voluntary
• Do the tax rules on pension savings contributions (AVCs). Can I transfer
limit the extra I can pay? them into the LGPS?
• How do I transfer?
• I’ve lost touch with my previous
pension provider. Who can help?
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Leave of Absence and the LGPS • What happens if my job is transferred

• What happens if I am on sick leave? to a private contractor?
• What happens if I am on maternity,
adoption or paternity leave or shared Life Cover – Protection For
parental leave? Your Family
• What happens if I am granted unpaid • What benefits will be paid if I die in
leave of absence? service?
• What happens if I am on strike? • What benefits will be paid if I die after
• What happens if I am on reserve forces retiring on pension?
service leave? • Who is the lump-sum death grant paid
• What if I am paying extra? to?
• What conditions need to be met for an
Leaving Your Job Before Retirement eligible cohabiting partner's
• Vesting period for LGPS pension survivor's pension to be payable?
entitlement
• If I'm eligible for a refund of Pensions and Divorce or
contributions, how is this worked out? Dissolution of a Civil Partnership
• What will happen to my benefits if I’ve • What happens to my benefits if I get
met the two-year vesting period? divorced or my civil partnership is
• How are deferred benefits worked out? dissolved?
• What if I paid extra? • What is the process to be followed?
• My LGPS benefits are subject to a • What if I remarry or enter into a new
pension sharing order. How does this civil partnership?
affect my deferred benefits?
• When are deferred benefits paid? Tax Controls and Your LGPS Benefits
• How do deferred benefits keep their • Are there any limits on how much I can
value? pay in contributions?
• Do the tax rules on savings cover • What are the tax controls on my
deferred benefits? pension savings?
• What will happen if I die before
receiving my deferred benefits? Help with Pension Problems
• What will happen if I wish to transfer • Who can help me if I have a query or
my LGPS benefits to another complaint?
(non-LGPS) scheme? • How can I trace my pension rights?
• What happens if I change jobs but
remain in the LGPS?
• What if I have two or more LGPS jobs? If You Joined the LGPS
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Before 1 April 2014

• How are benefits worked out?
• What counts towards membership in
the scheme before 1 April 2014?
• What counts towards final pay to work
out my benefits in the scheme before
1 April 2014?
• What if I am paying extra?
• When can I draw my LGPS benefits
built up before 1 April 2014?
• Additional protection if you are
nearing retirement.
Some Terms We Use
4
About this Booklet
The information in this booklet is based The booklet explains the benefits
on the Local Government Pension available to you as a member of the
Scheme Regulations 2013 and the LGPS. It describes how the scheme
Local Government Pension Scheme works, what it costs to be a member
(Transitional Provisions, Savings and and the financial protection that it offers
Amendment) Regulations 2014 (both to you and your family.
effective from 1 April 2014) and other
Where pension terms are used, they
relevant legislation. It applies to
appear in bold italic type. These terms
individuals who were contributing
members of the Local Government are defined in the Some Terms We Use
Pension Scheme (LGPS) on 1 April section.
2014 or who have joined the scheme The national website for members of the
on or after that date. The booklet is for LGPS is www.lgpsmember.org
employees in England or Wales and
reflects the provisions of the LGPS and
overriding legislation at the time of
publication.
In the future, the Government may make
changes to overriding legislation and,
after consultation with interested parties,
may make changes to the LGPS.
This booklet is for general use and cannot
cover every personal circumstance; nor
does it cover specific protected rights
that apply to a very limited number of
employees. In the event of any dispute
over your pension benefits, the
appropriate legislation will prevail as this
booklet does not confer any contractual
or statutory rights and is provided for
information purposes only.
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5
About the Local Government Pension Scheme (LGPS)
Who runs the LGPS? relevant statutory scheme under section

611A of that Act). This means, for
The LGPS is one of the largest public example, that you receive tax relief on
sector pension schemes in the UK. It is a your contributions. It complies with the
nationwide pension scheme for people relevant provisions of the Pension
working in local government or Schemes Act 1993, the Pensions Act
working for other types of employer 1995 and the Pensions Act 2004.
participating in the scheme. The LGPS
in England and Wales is administered The LGPS meets the Government's
locally through 90 local pension funds. standards under the automatic enrolment
provisions of the Pensions Act 2008.
LGPS rules
The scheme regulations were made
LGPS responsibilities
under the Superannuation Act 1972 and Information
in the future will be made under the The City of Wolverhampton Council is
Public Service Pension Schemes Act required to:
2013. Changes to scheme rules are
discussed at national level by employee • issue annual benefit statements to
and employer representatives, but can scheme members (other than to
only be amended with the approval of pensioners).
Parliament. Your administering authority, • have a statement setting out their
the City of Wolverhampton Council, must policy on communicating with
keep you informed of any changes that scheme members, members’
are made. representatives, prospective
The LGPS is a registered public service members and employers.
pension scheme under Chapter 2 You are entitled to obtain a copy of the
of Part 4 of the Finance Act 2004. Local Government Pension Scheme
It achieved automatic registration by Regulations 2013 (Statutory Instrument
virtue of Part 1 of Schedule 36 of that Number 2013/2356) and subsequent
Act (because the scheme was, amendments and the Local Government
immediately before 6 April 2006, both Pension Scheme (Transitional Provisions,
a retirement benefits scheme approved Savings and Amendment) Regulations
under Chapter I of Part XIV of the Income 2014 (Statutory Instrument Number
and Corporation Taxes Act 1988 and a 2014/525) and subsequent amendments.
6
The regulations are available from You can find more information from:
www.legislation.gov.uk A current West Midlands Pension Fund
version, including all amendments, is PO Box 3948
available on the website Wolverhampton
www.lgpsregs.org WV1 1XP
A copy of the regulations may be Governance

inspected at the Fund’s offices.
In addition, you are entitled to view, The City of Wolverhampton Council
and take copies of, the Fund’s annual must establish and operate a ‘Local
report and accounts. Pensions Board’. The Pensions Board
is responsible for assisting the
To maintain the security of any administering authority in securing
information about you, your compliance with the LGPS regulations,
administering authority, the City of overriding legislation and guidance from
Wolverhampton Council, is registered The Pensions Regulator. The Board is
under the current Data Protection Act. made up of equal representation from
You can check that your computerised employer and member representatives.
personal record is accurate, although in
some limited circumstances a small fee Funding
may be charged.
As a scheme member, you will pay
contributions to the LGPS. Your employer
Decisions currently pays in the balance of the cost
The regulations give specific of providing your benefits after taking into
responsibilities to employers and account investment returns. Every three
pension administrators, each of whom years, an independent actuary calculates
must make decisions in relation how much your employer should
to some matters and can exercise their contribute to the scheme. The amount
discretion in relation to others. will vary, but generally the present
underlying assumption is that employees
Many administering authorities set up a contribute approximately one third of
Pension Committee to oversee their the scheme's costs and the employer
pension scheme responsibilities which contributes the rest.
then acts in a similar role to trustees of
other pension schemes.
7
Future cost management

of the LGPS
To ensure the long-term sustainability of
the scheme, a cost management process
is now in place in the LGPS in England
and Wales which will monitor the cost of
the scheme to ensure it stays within
agreed parameters as set by the Scheme
Advisory Board and HM Treasury.
Should costs increase or decrease
outside those parameters, future changes
to the scheme design may be required.
8
Your Pensions Choice
In this section, we look at:

• Your pensions choice;
• Who can join the Local Government Pension Scheme
(LGPS); and
• The cost of being a member of the LGPS.
Where pension terms are used, they Local Government Pension

appear in bold italic type. These terms Scheme
are defined in the Some Terms We Use
section. The LGPS is a statutory, funded pension
scheme. As such, it is very secure
Taking your pension is a goal to look because its benefits are defined and set
forward to. However, if your pension is to out in law.
meet your expectations, you need to plan
now for your income in retirement. Key features of the LGPS include:
Your retirement income and benefits, A secure pension
over and above the state pension, will
in general be provided by a personal Worked out every scheme year and
pension plan, a stakeholder pension added to your pension account.
scheme or the Local Government Pension The pension added to your account at
Scheme. These are described briefly the end of a scheme year is, if you are
below. in the main section of the scheme,
an amount equal to a 49th of your
Your Pensions Choice pensionable pay in that year. At the end
of every scheme year, the total amount
• Local Government Pension Scheme of pension in your account is adjusted to
• Personal pension plans and take into account the cost of living (as
stakeholder pension schemes currently measured by the consumer
prices index - CPI).
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Flexibility to pay more or Freedom to choose when

less contributions to take your pension
You can boost your pension by paying You do not need to have reached your
more contributions, which you would get normal pension age in order to take
tax relief on. You also have the option your pension as, once you've met the
in the LGPS to pay half your normal two-years’ vesting period, you can
contributions in return for half your choose to retire and take your pension
normal pension. This is known as the at any time between age 55 and 75.
50/50 section of the scheme and is Your normal pension age is simply the
designed to help members stay in the age you can retire and take the pension
scheme when times are financially tough. you've built up in full. However, if you
choose to take your pension before your
Tax-free cash normal pension age, it will normally be
reduced, as it's being paid earlier. If you
You have the option when you draw your take it later than your normal pension
pension to exchange part of it for some age, it's increased because it's being paid
tax-free cash. later.
Peace of mind Redundancy or

Your family enjoys financial security, with
efficiency retirement
immediate life cover and a pension for If you are made redundant or retired in
your spouse, civil partner or eligible the interests of business efficiency at or
cohabiting partner and eligible after age 55, you will, provided you've
children in the event of your death in met the two-years’ vesting period,
service or if you die after leaving having receive immediate payment of the main
met the two-years’ vesting period. If benefits you've built up (but there would
you ever become seriously ill and you've be a reduction for early payment of any
met the two-years’ vesting period, additional pension you have chosen to
you could receive immediate ill-health buy).
benefits.
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Flexible retirement guaranteed or linked to your earnings.

The age from which you may receive
If you reduce your hours or move to a them will vary according to the plan.
less senior position at or after age 55,
you can, provided your employer agrees, Joining the LGPS
and you've met the two-years’ vesting
period, draw some or all of the benefits Who can join?
you have already built up, helping you
ease into retirement, although your The LGPS is offered by local
benefits may be reduced for early government employers and by
payment. other organisations that have chosen
to participate in it.
Tax relief To be able to join the LGPS, you need
As a member of the LGPS, if you earn to be under age 75 and work for an
enough to pay tax, your contributions employer that offers membership of
will attract tax relief at the time they are the scheme. If you are employed by a
deducted from your pay. designating body, such as a town or
parish council, or by a non-local
government organisation which
Personal pension plans and participates in the LGPS (an admission
stakeholder pension schemes body), you can only join if your employer
Various institutions, such as banks, nominates you for membership of the
building societies and life assurance scheme.
companies provide and administer Police officers, operational firefighters
personal pensions and stakeholder and, in general, teachers and employees
pension schemes. Your chosen eligible to join another statutory pension
organisation would invest your scheme (such as the NHS Pension
contributions. When you retire, the Scheme) are not allowed to join the
investments are cashed in and the LGPS.
sum of money realised is used to buy
retirement benefits from the insurance If you start a job in which you are eligible
market and, from April 2015, these for membership of the LGPS, you will be
benefits can also be taken as cash brought into the scheme if your contract
(subject to tax as appropriate). Your of employment is for three months or
benefits are therefore based on more. If it is for less than three months
investment returns and are not and you are, or during that period
become, an eligible jobholder, you
11
will be brought into the scheme from source’ arrangement, such as a personal
the automatic enrolment date pension or stakeholder pension scheme)
(unless your employer issues you with and be eligible for tax relief on those
a postponement notice to delay bringing contributions.
you into the scheme for up to a maximum
of three months) or, if your contract is Under HM Revenue and Customs rules,
extended to be for three months or more, there are controls on the pension savings
or you opt to join by completing an you can have before you become subject
application form, you will be brought to a tax charge – most people will not be
into the scheme from the beginning of affected by these controls. To find out
the pay period after the one in which more, see the section on Tax Controls
your contract is extended or you opt to and Your LGPS Benefits.
join.
How do I ensure that I have
If you are brought into the scheme you become a member of the
have the right to opt out. You cannot
complete an opt out form until you have
LGPS?
started your employment. On joining the LGPS, relevant records
and a pension account (for each
Can I join the LGPS if I already employment in the scheme, if you have
have a personal pension or more than one) will be set up and an
stakeholder pension scheme? official notification of your membership
of the LGPS will be sent to you. You
If you currently contribute to a personal should check your payslip to make
pension plan or stakeholder pension sure that pension contributions are
scheme and decide to join the LGPS, you being deducted.
can, if you wish, continue to make your
own contributions to the personal pension Can I opt out of the LGPS?
or stakeholder pension scheme or you
can stop paying into it and provided your If you are thinking of opting out you
pension fund administrator agrees, might first want to consider an alternative
consider transferring it into the LGPS. option which is to elect to move to the
50/50 section of the scheme. The 50/50
You can, if you wish, pay up to 100% of section allows you to pay half your
your total UK taxable earnings in any one normal contributions in return for half
tax year into any number of concurrent your normal pension build up. To find out
pension arrangements of your choice more, see the section on Contribution
(or, if greater, £3,600 to a ‘tax relief at Flexibility.
12
If, having considered the 50/50 option as anyone leaving their job before
you still decide the LGPS is not for you, retirement, except you cannot draw your
you can leave the LGPS at any time deferred benefits unless you have left
on or after your first day of eligible your job. Also, if you rejoin the scheme,
employment by giving your employer you will not be permitted to join the two
notice in writing. You might, however, periods of membership together. Instead,
want to take independent financial you will have two separate sets of
advice before making the final decision pension benefits in the scheme. You can
to opt out. find details of these options in the section
on Leaving Your Job Before
If you opt out of the LGPS before Retirement.
completing three months’ membership,
you will be treated as never having been If you opt out you can, provided you are
a member and your employer will otherwise eligible to join the scheme, opt
refund to you, through your pay, any back into the scheme at any time before
contributions you have paid during that age 75.
time.
If you opt out of the LGPS, then:
If you opt out of the LGPS with three or
more months membership and before • on the date your employer is first
completing the two-years’ vesting required to comply with the automatic
period, you can take a refund of your enrolment provisions under the
contributions (less any statutory Pensions Act 2008, your employer will
deductions) or transfer out your pension automatically enrol you back into the
to another scheme. If you were in the LGPS if you are an eligible jobholder
scheme before 1 April 2014 and opt out at that time in the job you’ve opted out
on or after that date with three or more from; or
months membership and before • if on the date your employer is first
completing the two-years’ vesting required to comply with the automatic
period, you will also have the option enrolment provisions under the
of having deferred benefits in the Pensions Act 2008, you are not an
scheme instead of taking a refund of eligible jobholder in the job you
your contributions (less any statutory opted out from, your employer will, if
deductions). you subsequently become an eligible
If you opt out of the LGPS after meeting jobholder in that job, automatically
the two-years’ vesting period, you will enrol you back into the LGPS from the
have deferred benefits in the scheme automatic enrolment date.
and will generally have the same options
13
Your employer must notify you if this • you hold office as a director of the
happens. You would then have the right company by which you are employed;
to again opt out of the LGPS. or
If you stay opted out your employer will • you are a member of a limited liability
normally automatically enrol you back partnership (LLP), have earnings
into the LGPS approximately every three payable by the LLP but you are not
years from the date they have to comply treated for income tax purposes as
with the automatic enrolment provisions being employed by the LLP.
provided, at the date your employer must
enrol you back in, you are an eligible Contributions
jobholder.
However, in any of the above cases, your
What do I pay?
employer can choose not to automatically The rate of contributions you pay is based
enrol you if: on how much you are paid. There are
nine different pay bands with contribution
• you had opted out of the LGPS less
rates ranging from 5.5% to 12.5% of your
than 12 months prior to the date you
pensionable pay. If you elect for the
would have been automatically
50/50 section of the scheme you would
enrolled in the job; or
pay half the rates listed below. The rate
• notice to terminate employment has you pay depends on which pay band you
been given before the end of the period fall into. When you join, and every April
of six weeks beginning with the date afterwards, your employer will decide
you would have been automatically your contribution rate. Also, if your pay
enrolled in the job; or changes throughout the year, your
employer may decide to review your
• your employer has reasonable grounds contribution rate.
to believe that, on what would have
been the date they would have
automatically enrolled you, you hold
primary protection, enhanced
protection, fixed protection, fixed
protection 2014, fixed protection 2016,
individual protection 2014 or individual
protection 2016 (see the section on Tax
Controls and Your LGPS Benefits);
or
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Here are the pay bands and contribution You do not pay contributions on any
rates that apply from April 2019. travelling or subsistence allowances,
pay in lieu of notice, pay in lieu of loss of
Contribution table 2019/20 holidays, any payment as an inducement
If your actual You pay a not to leave before the payment is made,
pensionable pay is: contribution rate of: any award of compensation (other than
Up to £14,400 5.5% payment representing arrears of pay)
made for the purpose of achieving
£14,401 to £22,500 5.8% equal pay, pay relating to loss of future
£22,501 to £36,500 6.5% pensionable payments or benefits, any
pay paid by your employer if you go on
£36,501 to £46,200 6.8% reserve forces service leave nor
£46,201 to £64,600 8.5% (apart from some historical cases) the
monetary value of a car or pay received
£64,601 to £91,500 9.9% in lieu of a car.
£91,501 to £107,700 10.5%
When you join the scheme, your
£107,701 to £161,500 11.4% employer will decide your appropriate
rate of contributions for each job you
£161,501 or more 12.5%
have. Your employer may decide to
review your contribution rate if, for
The contribution rates and/or pay bands
example, your pay changes during the
will be reviewed periodically and may
change in the future. This is to maintain year. If this results in a change to your
contribution rate, they must let you know.
the average contribution from employees
If you elect for the 50/50 section of the
at 6.5% and to ensure the long-term costs
of the scheme are managed. scheme, you will start paying half your
normal rate of contributions from your
You pay contributions on your normal next available pay period.
salary or wages plus any shift allowance,
bonuses, overtime (both contractual and You should check your payslip to make
non-contractual), maternity pay, paternity sure that pension contributions are being
pay, adoption pay, shared parental pay deducted.
and any other taxable benefit specified in Your contributions are very secure.
your contract as being pensionable. As the LGPS is set up by statute,
payment of benefits to scheme
members is guaranteed by law.
15
What does my employer pay? Is there any flexibility to pay

Your employer currently pays the
less contributions?
balance of the cost of providing your Yes, in the scheme there is an option
benefits after taking into account known as 50/50 which provides the
investment returns. Every three years, facility to contribute less to the LGPS.
an independent actuary calculates how If you elect for 50/50 you would, from
much your employer should contribute your next available pay period, pay half
to the scheme. The amount will vary, your normal contributions in return for
but generally the present underlying half your normal pension. You still retain
assumption is that employees contribute full life assurance and ill health cover
approximately one third of the scheme's when you are in the 50/50 section of the
costs and the employer contributes the scheme. To find out more, see the section
remainder. on Contribution Flexibility.
Do I receive tax relief on my Can I make extra contributions

contributions? to increase my benefits?
The LGPS is fully approved by HM You can increase your benefits by
Revenue and Customs, which means paying additional contributions, known
that if you earn enough to pay tax, you as additional pension contributions
receive tax relief on your contributions. (APCs) to buy extra LGPS pension, or
To achieve this, your contributions are by making payments to the scheme’s
deducted from your pensionable pay additional voluntary contributions
before you pay tax. So, for example, if (AVC) arrangement, or by paying
you pay tax at the rate of 20%, every £1 contributions into a personal pension,
that you contribute to the scheme only stakeholder pension or freestanding
costs you 80p net. There are restrictions AVC scheme of your own choice. These
on the amount of tax relief available on options are explained in more detail in the
pension contributions. If the value of your section on Contribution Flexibility.
pension savings increases in any one
year by more than the annual allowance Is there a limit to how much I
you may have to pay a tax charge.
Most people will not be affected by the
can contribute?
annual allowance. To find out more, see There is currently no limit on the amount
the section on Tax Controls and Your of contributions you can pay (although, as
LGPS Benefits. explained in the section on Contribution
Flexibility, there is a limit on the extra
16
LGPS pension you can buy). However, wish, be able to choose within 12 months
tax relief will only be given on of ceasing the job that has ended (or such
contributions up to 100% of your UK longer period as your employer may
taxable earnings (or, if greater, £3,600 to allow) to keep the pension accounts
a ‘tax relief at source’ arrangement, such separate. Details will be provided by the
as a personal pension or stakeholder Fund at the time.
pension scheme). Additionally, under
HM Revenue and Customs rules there Pension rights built up as a councillor or
are controls on the pension savings you mayor in England or Wales cannot be
can have before you become subject to joined with rights built up as an employee
a tax charge – most people will not be in England or Wales and vice versa.
affected by these controls. To find out
more, see the section on Tax Controls What about my other
and Your LGPS Benefits. non-LGPS pensions?
If you have paid into another non-LGPS
I’m already paying into the pension arrangement or to the LGPS in
LGPS in another job(s) – can I Scotland or Northern Ireland, you may be
also join in this job? able to transfer your previous pension
rights into the LGPS (provided you are not
If you are already paying into the LGPS
already taking them as a pension). You
and you get another job where your
only have 12 months from joining the
employer offers you membership of the
LGPS to opt to transfer your previous
scheme, you can be a member of the
pension rights, unless your employer and
scheme in all positions, provided you are
the City of Wolverhampton Council allow
eligible to join (see the paragraph above
you longer. This is a discretion; you can
on Who can join?). You will have a
ask your employer and the City of
separate pension account for each job
Wolverhampton Council what their policy
and receive a separate pension at
is on this.
retirement.
The Fund can advise you of their process
If you leave one job before leaving the
for transferring previous pension rights
other(s), the pension from the pension
into the LGPS.
account of the job that has ended will be
joined to the pension account for the Whether or not you should transfer your
ongoing job (or, if there is more than one pension rights is not always an easy
ongoing job, the one you choose) unless decision to make, and you may wish to
you have met the two-years’ vesting seek the help of an independent financial
period, in which case you will, if you adviser.
17
For more information, see the section on If you have deferred benefits in the LGPS
Transferring Pension Rights into the in England or Wales and left the scheme
LGPS. before 1 April 2014 or your deferred
benefits include membership built up
What if I’ve been a member before 1 April 2014, please see the
before and can now rejoin the Transferring Pension Rights into the
LGPS section for further information.
LGPS?
If you wish to transfer your previous
If you rejoin the LGPS and you have
LGPS pension rights, you should contact
deferred benefits in a LGPS administering
the Fund as soon as possible to find out
authority in England or Wales (which you
about the process and what you will need
were awarded other than as a result of
to consider in making your decision.
electing, on or after 11 April 2015, to opt
out of membership of the scheme) your Pension rights built up as a councillor or
deferred benefits will normally be mayor in England or Wales cannot be
automatically joined with your new active joined with rights built up as an employee
pension account. If you want to retain in England or Wales and vice versa.
separate deferred benefits then you must
make an election for separate benefits
within 12 months of rejoining the scheme
I'm already receiving an LGPS
(or such longer period as your employer pension – will it be affected?
allows). If you built up any pension in the
If you have deferred benefits in a LGPS scheme before 1 April 2014 and you
administering authority in England or are re-employed in local government
Wales which you were awarded as a or by an employer who offers
result of electing, on or after 11 April membership of the LGPS you must tell
2015, to opt out of membership of the the LGPS administering authority that
scheme, you cannot join those benefits pays your pension about your new
with your new active pension account. employment, regardless of whether you
They will remain as a separate deferred join the scheme in your new position or
benefit. not. They will let you know whether your
pension in payment is affected in any
If you rejoin the LGPS in England and way.
Wales and have a deferred refund, this
must be joined with your new active Subject to the next paragraph, if you
pension account. have only built up benefits in the LGPS
from 1 April 2014, take your pension and
18
are then re-employed in local expression of wish form. The form, if not
government or by an employer who included with this booklet, is available
offers membership of the LGPS you from the Fund.
do not need to inform the LGPS
administering authority that pays your If you cohabit with a partner of either the
pension as there is no effect on your opposite or same sex, there is a provision
pension in payment. in the LGPS for your partner to receive a
survivor's pension on your death.
If you are in receipt of an LGPS ill-health Your administering authority, the City
pension which is of the type that is of Wolverhampton Council, must be
stopped if you are in any gainful satisfied that your relationship meets
employment, your pension may be certain conditions laid down by the LGPS
affected and you must inform the before paying a survivor's pension to an
employer who awarded you that eligible cohabiting partner. You can
pension if you take up employment find out about these conditions from the
(whether in local government or section on Life Cover – Protection For
elsewhere). They will let you know Your Family.
whether your pension in payment
should be stopped. More information
Forms to fill in For more information or if you have a
problem or question about your LGPS
Death benefit forms benefits, please contact the Fund. Contact
details can be found at the front of this
If you die in service, a lump-sum death booklet.
grant of three times your assumed
pensionable pay is paid no matter how The national website for members
long you have been a member of the of the LGPS is www.lgpsmember.org
LGPS – please see the section on Life
Cover – Protection For Your Family You can find out about what you can do
for more information. if you are not happy about a decision
made about your LGPS pension position
Your administering authority, the City of from the section Help with Pension
Wolverhampton Council, has absolute Problems.
discretion when deciding on who to pay
any death grant to. The LGPS, however,
allows you to express your wish as to
who you would like any death grant to be
paid to by completing and returning an
19
Contribution Flexibility
In this section, we explain how, as a member of the LGPS, you

have:
• the option to pay less contributions in return for less
pension and
• the option to pay extra contributions to increase your
pension benefits.
Where pension terms are used, they The LGPS offers you the flexibility to stay
appear in bold italic type. These terms in the scheme at such times and continue
are defined in the Some Terms We Use to build up valuable pension benefits.
section. You can elect to pay half your normal
contributions and build up half your
Flexibility to pay less normal pension. This is known as the
50/50 section of the LGPS.
When you are a member of the LGPS
there may be times when you are in In the LGPS, there are two sections of the
difficult financial circumstances and scheme: the main section and the 50/50
consider opting out of the scheme to section. When you join the scheme, you
save money. will automatically be placed in the main
section where you pay normal pension
contributions in return for normal pension
build up.
Contribution
You pay a contribution rate of:
Band If your actual pensionable pay is: Main section 50/50 section
1 Up to £14,400 5.5% 2.75%
2 £14,401 to £22,500 5.8% 2.90%
3 £22,501 to £36,500 6.5% 3.25%
4 £36,501 to £46,200 6.8% 3.40%
5 £46,201 to £64,600 8.5% 4.25%
6 £64,601 to £91,500 9.9% 4.95%
7 £91,501 to £107,700 10.5% 5.25%
8 £107,701 to £161,500 11.4% 5.70%
9 £161,501 or more 12.5% 6.25%
20
Once you are a member of the scheme, What happens to life cover and
you can to elect in writing to move to the ill-health cover if I am in the
50/50 section if you wish. Once you make
an election, you will start paying half your
50/50 section?
normal contributions from your next In the 50/50 section, you build up half
available pay period. your normal pension because you are
paying half your normal contributions.
Who can elect for 50/50? However, if you were to die in service,
the lump-sum death grant and any
As a member of the LGPS, you can elect
survivor pensions would be worked out
to pay into the 50/50 section at any time.
as if you were in the main section of the
An election to join this section must be
scheme.
made in writing to your employer. There
is no limit to the number of times you If you are awarded a Tier 1 or Tier 2
can elect to move between the main and ill-health pension while in the 50/50
the 50/50 section, and vice versa. Your section, the amount of any ill-health
election once received by your employer enhancement added to your pension is
takes effect from the next available pay worked out as if you were in the main
period. section of the scheme.
What does my election for How long can I remain in the

50/50 need to include? 50/50 section?
You need to make a written election to The 50/50 section is designed to be a
your employer to move to the 50/50 short-term option for when times are
section of the LGPS. This can be in the tough financially. Because of this your
form of a letter. If you have more than employer is required to re-enrol you
one job in which you contribute to the back into the main section of the scheme
scheme, you must specify in which of approximately three years after they
the jobs you wish to be moved to the have reached their staging date for
50/50 section. automatic enrolment purposes under the
Pensions Act 2008 (and approximately
When you make an election for the 50/50
every three years thereafter). Your
section, your employer must provide you
employer will tell you when this is if
with information on the effect this will
you’re in the 50/50 section of the scheme.
have on your benefits in the scheme.
If you wish to continue in the 50/50
section at that point, you would need to
make another election in writing to
remain in that section of the scheme.
21
If you are in the 50/50 section and move What does my employer pay
on to a period of no pay due to sickness if I'm in the 50/50 section?
or injury or no pay during a period of
ordinary maternity leave, ordinary Your employer continues to pay their
adoption leave or paternity leave, then normal contribution rate (not half that
you will be moved back into the main rate) when you are in the 50/50 section
section of the scheme from your next pay of the scheme.
period if you are still in receipt of no pay
at the beginning of the next pay period. What if I'm currently paying
If you are in the 50/50 section you can extra contributions or might
choose to move to the main section of the wish to do so in the future –
scheme at any time by informing your is this possible in the 50/50
employer in writing. This can be in the section?
form of a letter or a completed election
form to join the main section. An election As the 50/50 section is considered a
form to join the main section is available short-term option for use in times of
from your employer or the Fund. If you financial difficulty it's not expected that
have more than one job in which you you will remain in the section for a long
contribute to the 50/50 section you must period of time. The rules of the scheme
specify in which of the jobs you wish to do not permit you to pay additional
be moved to the main section. You will contributions in certain circumstances
then start to build up full benefits in the when you are in the 50/50 section.
main section from the next available pay The effect on additional contribution
period after your employer receives your options are detailed below:
election.
22
Type of contract Effect of being in the 50/50 section

• Additional pension contribution (APC) contract Existing contracts - must cease
(full cost to you to buy extra pension)
• Shared-cost additional pension contribution New contracts - not permitted
(SCAPC) contract (cost shared between you
and your employer to buy extra pension)
• Additional voluntary contributions (AVC) Existing contracts - can continue
• Shared-cost additional voluntary contributions (at the same rate as before you
(SCAVC) elected for the 50/50 option)
• Additional pension contribution (APC) contract
(full cost to you to buy lost pension because New contracts - not permitted
of a trade dispute or unpaid authorised leave
of absence)
• Shared-cost additional pension contribution
(SCAPC) Contract (cost shared between you
and your employer to buy lost pension due to
unpaid authorised leave of absence or unpaid
additional maternity or adoption leave or
unpaid shared parental leave)
• Added years contract Existing contracts - can continue
(at the same rate as before you
elected for the 50/50 option)
Note that these contracts only
apply to scheme members who
took out such contracts before
1 April 2008.
• Additional regular contributions (ARC) contract Existing contracts - can continue
• Additional survivor benefit contributions (at the same rate as before you
(ASBC) contract elected for the 50/50 option)
Note that these contracts only
apply to scheme members who
took out such contracts before
1 April 2014.
• Part-time buy-back contract Existing contracts - can continue
(at the same rate as before you
elected for the 50/50 option).
New contracts - permitted
23
Flexibility to pay more Are there any limits on how much

I can pay to increase my pension
Most of us look forward to a happy and
comfortable retirement and, in order to benefits?
have that little bit extra during your There is no limit on the amount of
retirement years, you may wish to contributions you can pay (although there
consider paying extra contributions, is a limit on the extra scheme pension
which are a tax-efficient way of topping you can buy). However, tax relief will
up your income when you retire. only be given on contributions up to
There are a number of ways you can 100% of your UK taxable earnings (or,
provide extra benefits, on top of the if greater, £3,600 to a ‘tax relief at source’
benefits you are already looking forward arrangement, such as a personal pension
to as a member of the LGPS. or stakeholder pension scheme).
You can improve your retirement benefits Additionally, under HM Revenue and
by paying: Customs tax rules, there are controls on
the pension savings you can have before
• Additional pension contributions (APCs) you become subject to a tax charge –
to buy extra LGPS pension (but not if most people will not be affected by these
you are in the 50/50 section) controls. These controls, and the potential
• Additional voluntary contributions effect of paying extra contributions if
(AVCs) arranged through the LGPS you have lifetime allowance enhanced
(in-house AVCs) protection, fixed protection, or fixed
• Freestanding additional voluntary protection 2014 or fixed protection 2016
contributions (FSAVCs) to a scheme are explained in more detail later under
of your choice the heading Do the tax rules on
pension savings limit the extra I can
• Contributions into a stakeholder or pay?.
personal pension plan
You can combine any of these options.
24
The options explained: would not be practicable to allow

APCs to be paid by regular
Paying APCs to buy extra contributions, in which case payment
LGPS pension could be made by a lump-sum). Any
extra regular contributions would be
If you are in the main section of the taken from your pay, just like your
scheme, you can pay more in basic contributions.
contributions to buy up to £7,026 of
extra pension, or to purchase pension Your LGPS contributions and APCs are
lost during certain periods of leave of deducted before your tax is worked
absence on no pay or periods on no out, so, if you pay tax, you receive tax
pay due to a trade dispute. This section relief automatically through the payroll.
explains the facility to purchase extra You qualify for tax relief (normally at
pension – see the section Leave of your highest rate) on all pension
Absence and the LGPS for information contributions, including your normal
on purchasing lost pension. contributions, up to 100% of your
taxable earnings.
Any extra pension you purchase is
payable each year in retirement and is The minimum period of time you can
payable on top of your normal LGPS spread payment of APCs over is
benefits. You can pay for this extra 12 months and the maximum period
pension either regularly from your pay is the number of years to your normal
or via a lump-sum. If your employer pension age. The latest you can start
also chooses to contribute to the APC a contract to buy extra pension by
arrangement, this is known as SCAPC paying regular contributions is one
arrangement. If you are in the 50/50 year before your normal pension
section of the scheme, you cannot age.
commence an APC or SCAPC to buy At the end of every scheme year, the
extra pension. If you have an existing amount of extra pension that you
APC or SCAPC contract to buy extra have paid for in that year is added to
pension and elect for the 50/50 section your pension account.
the contract must cease.
You can choose to stop paying APCs
• Paying regular contributions at any time by notifying the Fund in
You can choose to buy extra pension writing. You will be credited with the
by spreading payment of the APCs extra pension that you have paid for at
over a number of complete years the time of ceasing payment.
(unless the Fund determines that it
25
• Paying by lump-sum pension account any extra pension

As an alternative to paying additional you are buying is to be credited to.
pension contributions (APCs) over a If you wish to pay APCs for each job,
period of time you can choose to buy you would have to make a separate
extra pension by paying a one-off election for each job.
lump sum either via your pay or
The cost of any extra pension you
directly to your LGPS administering
buy is paid for by you unless your
authority. If you choose to make
employer chooses to pay some or all
payment directly to the LGPS
of the cost of the APC. This is an
administering authority you will need
employer discretion. You can ask
to arrange tax relief directly with
your employer what their policy is on
HMRC as the contributions are not
this.
being deducted from your pay.
If you wish to buy extra pension and
You can choose to make a lump-sum
you already have an existing APC
payment to buy extra pension through
arrangement or, before 1 April 2014,
an APC any time you are contributing
you elected to buy additional pension
to the main section of the scheme.
under an ARC arrangement, the
The amount of extra pension you amount of additional pension from
purchase is added to your pension these existing arrangements will be
account in the scheme year in which taken into account when determining
payment is made. the maximum extra pension you can
buy within the £7,026 limit (2019/20
• General APC information figure).
The cost to you of buying extra
pension is calculated in accordance Any extra pension you purchase will
with guidance issued by the Secretary be paid at the same time as your main
of State for Housing, Communities and LGPS benefits.
Local Government and the cost can be
If you choose to retire early and draw
reviewed at any time. The extra
your benefits before your normal
pension you are buying will increase
in line with the cost of living, both pension age, or you are retired on
redundancy or business efficiency
before and after you take your pension.
grounds before your normal pension
If you have more than one job in which age, the extra pension you have
you are a member of the scheme, you bought will be reduced for early
would have to specify which job’s payment.
26
If you take your benefits on flexible If you die in service then no extra
retirement, you can, if you wish, take benefits from your APC contract will be
all the extra pension you have paid for payable. This is because the amount of
too, although it will be reduced for extra pension you purchase is for you
early payment if you retire before only.
your normal pension age. If you do
so, your APC contract will cease (if If you die after leaving but before
you are still paying these extra retirement and your benefits are held
contributions when you take your in the LGPS for payment (deferred
benefits), although you will be able benefits), then a lump-sum of five times
to take out a new APC contract the extra annual pension you paid for
(provided you are at least one year will be payable.
below your normal pension age if If you die after starting to take your
you want to pay the APCs by regular pension and you are under age 75 at
contributions). the date of death, a lump-sum of ten
If you are awarded (by your employer) times your extra annual pension minus
an enhanced ill-health pension (either any extra pension already paid to you
Tier 1 or Tier 2), then the remaining may be payable.
amount of any APC or SCAPC contract You can obtain a quote and print off an
you are paying at that time is deemed application form to buy extra pension
to have been paid in full and is credited at www.lgpsmember.org
to your pension account in the
scheme year your pension is paid. You can also contact the Fund for
further information on paying
If you take your pension after your APCs.
normal pension age, the amount of
any extra pension you have bought You may be required to undergo a
will be increased as its being paid later. medical examination at your own
expense before being allowed to buy
On retirement, you can choose to extra pension.
exchange some of the extra pension
you have bought for a tax-free cash
lump-sum in the same way as your
main LGPS pension. For more
information on exchanging part of
your pension for a lump-sum, see the
section on Your Pension.
27
Paying AVCs arranged through qualify for tax relief (normally at your
the LGPS (in-house AVCs) highest rate) on all pension contributions
up to 100% of your taxable earnings,
All LGPS administering authorities have including your normal contributions.
have an AVC arrangement in which you
can invest money, deducted directly from Deductions start from the next available
your pay, through an AVC provider pay period after your election has been
(often an insurance company or building accepted and you may vary or cease
society). If you choose to pay AVCs payment any time you are paying into
under the LGPS, the AVCs are invested the LGPS.
separately in funds managed by the AVC You can also pay in-house AVCs to
provider. You have your own personal provide extra life cover.
account that, over time, builds up with Your membership of the LGPS already
your contributions and the returns on gives you cover of three times your
your investment, and will be available to assumed pensionable pay if you die
you when you retire. You can often in service, but you can pay AVCs to
choose which investment route you increase this and/or, if the AVC
prefer. arrangement your LGPS administering
You can elect to pay an AVC if you are in authority (the City of Wolverhampton
either the main or 50/50 section of the Council) has set up includes this facility,
scheme. to provide additional benefits for your
dependants in the event of your death
You decide how much you can afford to in service. This may be subject to
pay. You can pay up to 100% of your satisfactory completion of a medical
pensionable pay into an in-house AVC questionnaire. Any extra life cover paid
in each job that you pay into the LGPS. for through AVCs will stop when you
retire or leave.
Your employer can also pay towards
your AVC. This is known as a shared-cost Here are the different ways you may be
AVC. This is an employer discretion. able to use your in-house AVC fund on
retirement:
AVCs are deducted from your pay,
just like your normal contributions. • Buy one or more annuities
Your LGPS and AVC contributions are This is where an insurance company,
deducted before your tax is worked out, bank or building society of your choice
so, if you pay tax, you receive tax relief takes your AVC fund and pays you a
automatically through the payroll. You pension in return.
28
You would buy an annuity at the same • Take your AVCs as cash
time as you take your LGPS benefits. You can take some or all of your AVC
fund as a tax-free cash lump-sum1 , but
An annuity is paid completely you can only take it all as a lump-sum
separately from your LGPS benefits. if you take it at the same time as your
The amount of annuity depends on main LGPS benefits and provided,
several factors, such as interest rates when added to your LGPS lump-sum,
and your age. You also have some it does not exceed 25% of the overall
choice over the type of annuity, for value of your LGPS benefits (including
example whether you want a flat-rate your AVC fund).
pension or one that increases each
year, and whether you also want to • Buy extra membership in the LGPS
provide for dependants’ benefits in the If your election to start paying AVCs
event of your death. was made before 13 November
2001, you may be able in certain
Annuities are subject to annuity rates circumstances (such as flexible
which, in turn, are affected by interest retirement, retirement on ill-health
rates. grounds, or on ceasing payment of
your AVCs before retirement) to
When interest rates rise, the convert your AVC fund into extra
organisation selling annuities obtains LGPS membership in order to increase
a greater income from each pound in your LGPS benefits. To find out how
your AVC fund, and therefore can benefits are calculated on this
provide a higher pension. A fall in membership, see the section If You
interest rates reduces the pension Joined the LGPS Before 1 April
which can be purchased. 2014.
• Buy a top-up LGPS pension • Transfer your AVC fund to another
When you take your LGPS benefits you pension scheme or arrangement
can use some or all of your AVC fund You can transfer your AVC fund to
to buy a top-up pension from the LGPS. another pension scheme or
This automatically provides an inflation- arrangement, including to a scheme
proofed pension and also provides that offers flexible benefits,
dependants’ benefits. The amount of independently of your main scheme
pension you receive is based on set benefits; and provided you have
factors which vary from time to time. stopped paying AVCs, you can
1
Provided the lump-sum does not exceed £263,750 (2019/20 figure) or if you have previously taken
payment of (crystallised) pension benefits, 25% of your remaining lifetime allowance.
29
transfer your AVC fund even if you free and impartial and can be accessed
continue to contribute to the LGPS. on the internet, by phone, or face-to-
face. For more information, see
If you were to transfer your AVC fund www.pensionwise.gov.uk
to a defined contribution scheme, the
four main flexible benefit options that If you are considering taking flexible
the scheme might offer (from age 55) benefits, you should consider accessing
include: this pension guidance and taking
independent advice to help you decide
• purchasing an annuity (yearly which option is most suitable for you.
pension) or scheme pension
Please note, Pension Wise does not
• taking a number of cash sums at provide guidance about taking benefits
different stages from a defined benefit scheme such as
the LGPS.
• taking the entire pot as cash in one
go If you take benefits on flexible
retirement and your AVC contract
• flexi-access drawdown – using your started on or after 13 November 2001,
pension pot to provide a flexible you can choose to take all of your AVC
income. You are normally allowed fund at the time you take your flexible
to take a tax-free lump-sum of up to retirement benefits, and, if you wish,
25% then set aside the rest to continue paying AVCs. If your AVC
provide taxable lump-sums as and contract started before 13 November
when, or a regular taxable income. 2001, your AVC contract will cease and
you will have to use all of your AVC
You should be aware that there may be
fund in one of the above ways at the
tax implications associated with
time you take your flexible retirement
accessing flexible benefits. The income
benefits.
from a pension is taxable; the rate of
tax you would pay depends on the If you leave before retirement, your
amount of income that you receive contributions will cease when you
from a pension and from other leave. The value of your AVC fund will
sources. continue to be invested until it is paid
out. Your AVC can be transferred to
Pension guidance is available from
another pension arrangement or
the Government’s guidance website
taken at the same time as your LGPS
Pension Wise if you are considering
benefits.
taking flexible benefits. The guidance is
30
Payments into in-house AVCs will stop but you can increase this amount via an
when you leave or retire. FSAVC or use the FSAVC to provide
additional dependants benefits on your
You can also contact the Fund for death. This may be subject to satisfactory
further information on paying AVCs. completion of a medical questionnaire.
Paying FSAVCs Contribute to a concurrent

These are similar to in-house AVCs but personal pension plan or
are not linked to the LGPS in any way. stakeholder pension scheme
With FSAVCs, you choose a provider,
usually an insurance company. You may You can make your own arrangements
want to consider their different charges, to pay into a personal pension plan or
alternative investments and past stakeholder pension scheme at the same
performance when you do this. time as paying into the LGPS. With these
You choose how much to pay into an arrangements, you choose a provider,
FSAVC arrangement. You can pay up to usually an insurance company. You
100% of your UK taxable earnings, less may want to consider their charges,
your normal pension contributions. alternative investments and past
performance when you do this.
Your FSAVC fund should grow as it is
invested and will be available later in You choose how much to pay into the
your life to convert into an additional arrangement. You can pay up to 100% of
pension of your choice. You can often your total UK taxable earnings in any one
choose which investment route you tax year into any number of concurrent
prefer. pension arrangements of your choice
(or, if greater, £3,600 to a ‘tax relief at
You can take up to 25%2 of the value of source’ arrangement, such as a personal
your FSAVC fund as a tax-free lump-sum3. pension or stakeholder pension scheme)
and be eligible for tax relief on those
You can also pay FSAVCs to provide contributions.
additional life cover. Your LGPS
membership already gives you cover If you pay into a personal pension plan
of three times your assumed or stakeholder pension scheme, the
pensionable pay if you die in service, contributions you make to it are invested
2
From April 2015 you can take the remainder of your FSAVC as a lump-sum (subject to your marginal tax
rate) provided the FSAVC provider allows this option.
3
31
in funds managed by an insurance I am already buying extra

company. You have your own personal LGPS membership and or
account that, over time, builds up with
your contributions and the returns on
paying ARCs. Can I buy any
your investment, and will be available extra benefits?
later in your life to convert into additional Even if...
benefits. You can often choose which
investment route you prefer. • you are buying extra years of LGPS
membership (added years) under a
When the benefits are paid, you will be contract which you entered into before
able to take up to 25% of your Fund as a 1 April 2008, and/or
tax-free lump-sum4, with the remainder
available for use to buy an annuity from • you are purchasing additional pension
an insurance company, bank or building through an ARC contract which you
society or, if the personal pension or entered into before 1 April 2014,
stakeholder provider offers the option, to
...you can still pay APCs to buy extra
take as a taxable lump sum or to use for
LGPS pension (APCs) up to a maximum
flexi-access drawdown.
of £7,026 (including any additional
For more information on the variety of pension being bought by ARCs) and/or
options available when taking benefits pay AVCs, or FSAVCs, or contribute to a
from a personal pension plan or a concurrent personal pension plan or
stakeholder pension scheme, see the stakeholder pension scheme, if you wish.
Government's guidance website
www.pensionwise.gov.uk Can my employer award me
This website provides guidance on
any extra pension benefits?
taking flexible benefits only and does Your employer, at their discretion, can
not provide information on taking award additional annual pension of up to
benefits from a defined benefit £7,026. This can be awarded to you if you
scheme such as the LGPS. are an active member or within six
months of leaving the scheme if you
leave on the grounds of redundancy or
business efficiency. You can ask your
employer what their policy is on this.
1
32
Your employer can also, at their • entered into an SCAPC to purchase the
discretion, pay into your AVC scheme amount of lost pension during a period
arranged through the LGPS (in-house of unpaid authorised leave of absence
AVCs). This is known as a shared-cost or during a period of unpaid additional
AVC arrangement. maternity or adoption leave or unpaid
shared parental leave,
What happens if I pay extra and • entered into a contract to buy-back
elect for the 50/50 option? some previous part-time service,
If you move from the main section of • before 1 April 2014 entered into a
the scheme to the 50/50 section, the contract to buy extra pension (ARCs),
following rules apply:
• before 1 April 2014 entered into a
If you have... contract to count pre-6 April 1988
• entered into a contract to buy extra membership for a surviving eligible
pension by making APCs or entered cohabiting partner's pension, or
into an SCAPC contract with your • before 1 April 2008 entered into a
employer, contract to buy extra LGPS
...these contracts must cease when you membership (added years),
elect to move to the 50/50 section. Also, ...these contracts continue when you
when you are in the 50/50 section of the elect to move to the 50/50 section and the
scheme, you cannot elect to commence contributions under the contracts must be
payment of an APC contract, nor can you paid in full.
elect to commence payment of an
SCAPC, unless it's to purchase an amount If you have...
of pension lost during certain periods of
leave of absence on no pay or periods on • entered into an AVC arrangement or
no pay due to a trade dispute (see below). an SCAVC arrangement with your
employer,
If you have...
...these continue when you elect to move
• entered into an APC contract to to the 50/50 section, unless you (or your
purchase the amount of lost pension employer in the case of a SCAVC) choose
due to a trade dispute, to terminate the contract. You can elect to
commence payment of an AVC or SCAVC
when you are in the 50/50 section of the
scheme.
33
In the 50/50 section of the scheme, you Do the tax rules on pension
can commence payment of: savings limit the extra I can
• an SCAPC to purchase the amount of pay?
pension lost during a period of unpaid
There are HM Revenue and Customs
authorised leave of absence or during a
controls on the total amount of
period of unpaid additional maternity or
contributions you can make into all
adoption leave or unpaid shared
pension arrangements and receive tax
parental leave,
relief. There are also controls, known
• an APC to purchase the amount of as the lifetime allowance and the annual
pension lost during a trade dispute, or allowance on all the pension savings you
can have before you become subject to a
• an AVC or SCAVC. tax charge. Most scheme members’
pension savings will be less than these
What if I'm paying extra and I allowances.
am absent from work? You can, if you wish, pay up to 100% of
The rules that apply if you are paying your UK taxable earnings in any tax year
extra contributions and you are absent into any number of concurrent pension
from work due to... arrangements of your choice (or, if
greater, £3,600 to a ‘tax relief at source’
• sickness or injury, arrangement, such as a personal pension
or stakeholder pension scheme) and
• relevant child-related leave, receive tax relief on the contributions.
• authorised leave of absence, The lifetime allowance is the total capital
• a trade dispute, or value of all your pension arrangements
which you can build up without paying
• reserve forces service leave. extra tax. If the value of your benefits
when you take them (not including any
...are covered in the section on Leave of state retirement pension, state pension
Absence and the LGPS. credit or any spouse’s, civil partner’s,
eligible cohabiting partner’s or
dependant’s pension you may be entitled
to) exceeds your lifetime allowance a tax
charge will be made against the excess.
The lifetime allowance for 2019/20 is
£1,055,000 (unless you have a protected
higher lifetime allowance, see the
34
section on Tax Controls and Your LGPS previous tax years that can be carried
Benefits). forward.
The annual allowance is the amount your If you have applied for lifetime allowance
pension savings can increase by in any enhanced protection, fixed protection,
one year without paying extra tax. Until fixed protection 2014 or fixed protection
the 2014/15 year the pension saving year 2016 from HM Revenue and Customs
in the LGPS ran from 1 April to 31 March. you will lose that protection if you pay
From 6 April 2016, the pension saving contributions into a money purchase
year for all pension schemes is aligned pension arrangement (eg, pay LGPS
with the tax year – 6 April to 5 April. in-house AVCs or pay into a stakeholder
Special transitional arrangements applied or personal pension plan). You may not
for 2015/16. The annual allowance for lose this protection if you were paying
2019/20 is £40,000, unless you are a high AVCs at 5 April 2006 purely for extra life
earner who is subject to the tapered cover and the terms of the policy have
annual allowance in which case it may be not varied significantly since then.
lower. See the section on Tax Controls
and Your LGPS Benefits. You can find out more about HM
Revenue and Customs controls on your
You would only be subject to an annual pension savings from the section on Tax
allowance tax charge if the value of your Controls and Your LGPS Benefits.
pension savings for a tax year increases
by more than the annual allowance. More information
However, a three year carry forward rule
normally allows you to carry forward For more information or if you have a
unused annual allowance from the last problem or question about your LGPS
three tax years. This means that even benefits, please contact the Fund. Contact
if the value of your pension savings details can be found at the front of this
increases by more than the annual booklet.
allowance in a year you may not be The national website for members
subject to an annual allowance tax of the LGPS is www.lgpsmember.org
charge.
You can find out about what you can do
Most people will not be affected by the
if you are not happy about a decision
annual allowance tax charge because
the value of their pension saving will not
from the section Help with Pension
increase in a tax year by more than the
Problems.
annual allowance or, if it does, they are
likely to have unused allowance from
35
Your Pension
You can look forward to enjoying a guaranteed package of

benefits when you retire.
In this section, we look at how your pension is worked out and
when you can draw your pension if you pay into the LGPS on
or after 1 April 2014.
Where pension terms are used, they Your LGPS annual pension
appear in bold italic type. These terms
are defined in the Some Terms We Use If you are in the main section of the
section. scheme, the rate you build up your
pension is 1/49th of the amount of your
How is your pension worked pensionable pay and any assumed
pensionable pay in the scheme year.
out?
If you are in the 50/50 section of the
Your LGPS benefits are made up of:
scheme, the rate you build up your
• an annual pension that, after leaving, pension is half the rate in the main
increases every year in line with the section – 1/98th of the amount of your
cost of living for the rest of your life, pensionable pay and any assumed
and pensionable pay in the scheme year.
• The option to exchange part of your Your pensionable pay is the amount
pension for a tax-free lump sum paid of pay on which you pay pension
when you take your pension benefits. contributions.
• the option to exchange part of your If you are absent from work on reduced
pension for a tax-free lump-sum paid contractual pay or no pay due to sickness
when you draw your pension benefits. or injury or have a period of relevant
child-related leave or reserve forces
This section covers how your LGPS service leave then, during the period of
annual pension is worked out. If you absence, the pensionable pay used is
joined the LGPS before 1 April 2014, the notional pay you would have received
your benefits for membership before but for the absence. This is known as
1 April 2014 were built up in the final assumed pensionable pay and ensures
salary scheme and are calculated that the pension you build up during this
differently. To find out more see the period is not affected by your reduction
section If you joined the LGPS before in pay. However, during any part of
1 April 2014.
36
relevant child-related leave where the If you have a court order requiring
pensionable pay you received is higher that part of your pension should be
than your assumed pensionable pay, transferred to an ex-spouse or civil
your actual pensionable pay for that partner following divorce or dissolution
part of the leave period is used instead. of a civil partnership, then an amount is
deducted from your pension account in
You will have a pension account and the scheme year in which the court
your pension built up each scheme year order takes effect.
is added to your account. The scheme
year runs from 1 April to 31 March. If you have an annual allowance tax
If you hold separate pensionable charge applied to your LGPS benefits
employments you will have a separate then an amount is deducted from your
pension account for each job. pension account in the scheme year
when the charge is due.
If you are paying extra contributions
to buy extra pension through APCs or At the end of every scheme year,
SCAPCs, the amount you buy in each the value of the pension held in your
scheme year is added to your pension pension account is revalued.
account. Revaluation means that the value of
your pension keeps up with the cost of
Your employer may also enhance your living. The value of your pension is
pension by awarding you up to £7,026 revalued in line with HM Treasury
(2019/20 figure) of extra annual pension. Revaluation Orders which currently use
This is a discretion your employer can the rate of the consumer prices index
use if they so wish and they will publish (CPI) to revalue your pension account.
their policy on this. Any extra pension If the cost of living falls, and a negative
awarded by your employer is added to HM Treasury Revaluation Order is
your pension account in the scheme issued the value of the pension held in
year in which it is awarded. your pension account is reduced.
If you transfer a previous pension
into the LGPS, the amount of pension
that the transfer purchases is added to
your pension account in the scheme
year in which the transfer takes place.
37
How is my pension worked out • their pensionable pay increases by 1%

- an example each year
Let's look at the build-up in a member's • the cost of living (revaluation

pension account for six years in the adjustment) for the end of the scheme
scheme. years ending on 31 March 2015, 2016,
2017, 2018 and 2019 are 1.2%, -0.1%,
Let's assume that: 1%, 3% and 2.4% respectively; let's
assume that the cost of living
• a member joins the scheme on 1 April (revaluation adjustment) for the
2014 following year is 2%.
• their pensionable pay is £24,500 in
scheme year
Scheme Opening Pension build up Total Cost of living Update total
year balance in scheme year account revaluation account
Pay/build-up rate 31 March adjustment
= pension
1 £0.00 £24,500/49 = £500.00 1.2% = £6.00 £500.00 +

2014/15 £500 £6.00 =
£506.00
2 £506.00 £24,745/49 = £1,011.00 -0.1% = -£1.01 £1,011.00 +
2015/16 £505 -£1.01
£1,009.99
3 £1,009.99 £24,992.45/49 = £1,520.04 1.0% = £15.20 £1,520.04 +
2016/17 £510.05 £15.20 =
£1,535.24
4 £1,535.24 £25,242.37/49 = £2,050.39 3.0% = £61.51 £2,050.39 +
2017/18 £515.15 £61.51 =
£2,111.90
5 £2,111.90 £25,494.79/49 = £2,632.20 2.4% = £63.17 £2,632.20 +
2018/19 £520.30 £63.17 =
£2,695.37
6 £2,695.37 £25,749.74/49 = £3,220.87 2% = £64.42 £3,220.87 +
2019/20 £525.50 £64.42 =
£3,285.29
38
Let's assume that the member joined the contributions in return for half their normal
50/50 section of the scheme for six months pension build up. Their pension account
from 1 April 2015 to 30 September 2015 would look like this:
and paid half their normal pension
Scheme Opening Pension build up Total Cost of living Update total

year balance in scheme year account revaluation account
Pay/build-up rate 31 March adjustment
= pension
1 £0.00 £24,500/49 = £500.00 1.2% = £6.00 £500.00 +

2014/15 £500 £6.00 =
£506.00
2 £506.00 £12,372.50/98 = £884.75 -0.1% = -£0.88 £884.75 +
2015/16 £126.25 -£0.88 =
£883.87
£12,372.50/49 =
£252.50
3 £883.87 £24,992.45/49 = £1,393.92 1.0% = £13.94 £393.92 +
2016/17 £510.05 £13.94 =
£1,407.86
4 £1,407.86 £25,242.37/49 = £1,923.01 3.0% = £57.69 £1,923.01 +
2017/18 £515.15 £57.69 =
£1,980.70
5 £1,980.70 £25,494.79/49 = £2,501.00 2.4% = £60.02 £2,501.00 +
2018/19 £520.30 £60.02 =
£2,561.02
6 £2,561.02 £25,749.74/49 = £3,086.52 2% = £61.73 £3,086.52 +
2019/20 £525.50 £61.73 =
£3,148.25
39
You can take a tax-free lump sum by If you were paying into the LGPS on
giving up some of your annual pension. 31 March 2012 and were within ten years
You can take up to 25% of the capital of age 65 on 1 April 2012, you may have
value of your LGPS benefits as a lump additional protection to ensure that the
sum5. For every £1 of annual pension that value of the pension you build up in the
you give up you will receive a £12 lump main section of the scheme after
sum. In the same way, giving up £100 of 31 March 2014 is at least as good as the
your annual pension would give you amount of pension you could have built
£1,200 lump sum, and so on. up if you had continued to build up
pension at the rate of 1/60th of your
Your pension can be reduced or final pay for each year of membership.
increased, depending on your reasons Please read the section If you joined
for taking your pension benefits - see the LGPS before 1 April 2014 for
When can I retire and take my more information.
LGPS pension? below.
If you joined the LGPS before 1 April What options do I have on
2014 you will have benefits in the final when I take my benefits
salary scheme. Benefits built up before from the scheme?
1 April 2014 are worked out differently
and are calculated using your You may be able to alter your standard
membership in the scheme before retirement package by:
1 April 2014 and your final pay
when you leave the Scheme. Taking a lump-sum
As mentioned earlier, when you take
For each year of LGPS membership your pension you will be able to take part
built up between 1 April 2008 and of your benefits as a tax-free lump-sum
31 March 2014 you receive a pension by giving up some of your pension.
based on 1/60th of your final pay. An option to take a lump-sum has to be
made in writing before your benefits are
For each year of LGPS membership built paid. So that you have plenty of time to
up before 1 April 2008 you receive a make up your mind and seek financial
pension based on 1/80th of your final advice if you wish, it is important you
pay. You will also receive an automatic contact the Fund well in advance of your
lump sum. Please read the section If you intended retirement date so we/they can
joined the LGPS before 1 April 2014 provide you with more details.
for more information.
5
Provided the lump-sum does not exceed £253,750 (2019/20 figure), or if you have previously taken
40
Your pension will be reduced in What if I have paid extra?

accordance with any election you make
to receive a lump-sum. Any subsequent If you have bought extra LGPS
pension for your spouse, civil partner, pension by paying APCs or SCAPCs
eligible cohabiting partner or eligible either by making regular payments or
children will not be affected if you decide paying a one-off lump sum.
to exchange part of your pension for a
When you take your pension, this will
lump-sum.
include the extra pension that you have
If you have a guaranteed minimum paid for. However, if you are paying
pension (GMP), you may not reduce APCs or SCAPCs by regular payments
your pension to below the level of your when you retire and qualify for the type
GMP. of ill health pension where your benefits
are enhanced (Tier 1 and Tier 2 ill health
Getting a small pension paid as a pensions), you will be credited with all the
lump-sum extra pension that you set out to buy,
The Fund may be able to pay a small even if you have not completed full
pension as a one-off lump-sum less a tax payment for it.
charge. However, the circumstances
If you choose to retire early and take
where this may happen are restrictive,
your benefits before your normal
particularly if you have any other pension
pension age, or you are retired on
benefits.
redundancy or business efficiency
If a small pension is paid as a one off grounds before your normal pension
lump-sum, all other benefits from the age, the extra pension you have bought
LGPS would have to cease, so the Fund will be reduced for early payment.
will have to check that you have no other
If you take your benefits on flexible
LGPS benefits before deciding whether
retirement, you can, if you wish, take all
your pension can be paid as a one off
the extra pension you have paid for too,
lump-sum.
although it will be reduced for early
payment. If you do so, your APC
contract and/or SCAPC contract will
cease (if you are still paying these
extra contributions when you take your
benefits) although you will be able to take
out a new APC contract (provided you
are at least one year below your normal
pension age if you want to pay the APCs
41
by regular contributions) or, subject to the extra pension you have paid for,
your employer’s discretions policy, a new although it will be reduced for early
SCAPC contract. payment. If you choose to take the extra
pension on flexible retirement, your ARC
If you take your pension after your contract will cease (if you are still paying
normal pension age, the amount of any these extra contributions when you take
extra pension you have bought will be your benefits).
increased as its being paid later.
You can choose to exchange some of the
You can choose to exchange some of the extra pension you have bought for a cash
extra pension you have bought for a cash lump sum in the same way as your main
lump-sum in the same way as your main LGPS pension.
LGPS pension.
If you are buying extra years in the
If you are buying extra LGPS LGPS (added years)
pension by paying ARCs You will be credited with the extra years
When you take your pension you will be of membership that you have paid for
credited with the extra pension that you and you will receive extra retirement
have paid for. This will increase the value benefits calculated on the same basis that
of your retirement benefits. you agreed to buy them – but see below
However, if you are paying ARCs when for the rules on ill-health retirement. This
you retire and qualify for the type of extra membership is worked out using
ill-health pension where your benefits your final pay when you leave and is
are enhanced (Tier 1 and Tier 2 ill-health included in your membership built up in
pensions), you will be credited with all the scheme before April 2014. For further
the extra pension that you set out to buy, information on how this is worked out,
even if you have not completed full see the section If You Joined the LGPS
payment for it. Before 1 April 2014.
If you choose to retire early and take If you retire on ill-health grounds while
your benefits before age 65, or you are paying for extra years, you will normally
retired on redundancy or business be credited with the whole extra period of
efficiency grounds before that age, the membership that you set out to buy, even
extra pension you have bought will be if you have not completed full payment
reduced for early payment. for it.
If you take your benefits on flexible If you retire early because of redundancy
retirement, you can, if you wish, take all or business efficiency while paying for
42
extra years, you will have the opportunity If you are paying AVCs arranged
to pay the remaining contributions due in through the LGPS (in-house AVCs)
a lump-sum in order to complete your Your contributions will cease when you
contract. cease to contribute to the LGPS (when
your employment ends, when you elect
If you take your benefits on taking to leave the Scheme or when you reach
flexible retirement and you elected before the scheme’s upper age limit for
1 October 2006 to commence your added membership, which is age 75). However,
years contract, you will be credited with the rules are slightly different if you take
the extra years of membership that you flexible retirement, as explained later.
have paid for and this will increase the
value of your benefits paid on flexible Here are the different ways you can use
retirement. If you elected on or after your in-house AVC fund:
1 October 2006 to commence your added
years contract, you can, if you wish, • Buy one or more annuities
choose to be credited with the extra This is where an insurance company,
years of membership that you have bank or building society of your choice
paid for at the point of flexible retirement takes your AVC fund and pays you a
and this will increase the value of your pension in return.
benefits paid. If you choose to be credited You would buy an annuity at the same
with the extra years of membership on time as you take your LGPS benefits.
flexible retirement, your added years
contract will cease (if you are still paying An annuity is paid completely
these extra contributions when you take separately from your LGPS benefits.
your benefits). If you do not choose to
be credited with the extra years of The amount of annuity depends on
membership on flexible retirement, your several factors, such as interest rates
added years contract will continue. and your age. You also have some
choice over the type of annuity, for
If your benefits when you take them are example, whether you want a flat-rate
reduced for early payment then your pension or one that increases each
benefits from the added years are year, and whether you also want to
reduced in the same way. The reduction provide for dependants’ benefits in the
is applied based on the normal pension event of your death.
age applicable to benefits built up before
April 2014. For further information on Annuities are subject to annuity rates
how this is worked out, see the section which in turn are affected by interest
If you Joined the LGPS Before 1 April rates.
2014.
43
When interest rates rise, the your AVCs before retirement) to

organisation selling annuities can convert your AVC fund into extra LGPS
obtain a greater income from each membership in order to increase your
pound in your AVC fund, and therefore LGPS benefits. To find out how benefits
can provide a higher pension. A fall in are calculated on this membership, see
interest rates reduces the pension the section If You Joined the LGPS
which can be purchased. Before 1 April 2014.
• Buy a top-up LGPS pension • Transfer your AVC fund to another
When you take your LGPS benefits you pension scheme or arrangement
can use some or all of your AVC fund You can transfer your AVC fund to
to buy a top-up pension from the another pension scheme or
LGPS. This automatically provides an arrangement, including to a scheme
inflation-proofed pension and can that offers flexible benefits,
provides dependants’ benefits. independently of your main scheme
The pension you buy is based on set benefits; and provided you have
purchase factors which can vary from stopped paying AVCs, you can even
time to time. transfer your AVC funds if you
continue to contribute to the LGPS.
• Take your AVCs as cash
You can take some or all of your AVC If you were to transfer your AVC funds
fund as a tax-free cash lump-sum6, but to a defined contribution scheme, the
you can only take it all as a lump-sum if four main flexible benefit options the
you take it at the same time as your scheme might offer (from age 55)
main LGPS benefits and provided, are:
when added to your LGPS lump sum,
it does not exceed 25% of the overall • purchasing an annuity (yearly
value of your LGPS benefits (including pension) or scheme pension
your AVC fund). • taking a number of cash sums at
• Buy extra membership in the LGPS different stages
If your election to start paying AVCs • taking the entire pot as cash in
was made before 13 November 2001, one go
you may be able in certain
circumstances (such as flexible • flexi-access drawdown - using your
retirement, retirement on ill-health pension pot to provide a flexible
grounds, or on ceasing payment of income. You are normally allowed to
6
Provided the lump-sum does not exceed £263,750 (2019/20 figure), or if you have previously taken
44
take a tax-free lump-sum of up to fund at the time you take your flexible
25% then set aside the rest to retirement benefits, and, if you wish,
provide taxable lump-sums as and continue paying AVCs. If your AVC
when, or a regular taxable income. contract started before 13 November
2001 your AVC contract will cease and
You should be aware that there may you will have to use all your AVC fund in
be tax implications associated with one of the above ways at the time you
accessing flexible benefits. The income take your flexible retirement benefits.
from a pension is taxable; the rate of
tax you would pay depends on the If you leave before retirement, your
amount of income that you receive contributions will cease when you leave.
from a pension and from other The value of your AVC fund will continue
sources. to be invested until it is paid out. Your
AVC plan can be transferred to another
Pension guidance is available from pension arrangement or taken at the
the Government’s guidance website same time as your main LGPS benefits.
Pension Wise if you are considering
taking flexible benefits. The guidance is Payments into in-house AVCs will stop
free and impartial and can be accessed when you leave or retire.
on the internet, by phone, or face-to-
face. For more information, see When can I retire and take my
www.pensionwise.gov.uk LGPS pension
If you are considering taking flexible The normal pension age in the LGPS
benefits, you should consider accessing is linked to your state pension age
this pension guidance and taking (but with a minimum of age 65). You can
independent advice to help you decide choose to retire and take your pension
which option is most suitable for you. from the LGPS at any time from age 55 to
75, provided you have met the two-years’
Please note, Pension Wise does not vesting period in the scheme. If you
provide guidance about taking benefits choose to take your pension before your
from a defined benefit scheme such as normal pension age it will normally be
the LGPS. reduced, as it’s being paid earlier. If you
If you take benefits on flexible take it later than your normal pension
retirement and your AVC contract age, it’s increased because it’s being paid
started on or after 13 November 2001 later. You must take your benefits in the
you can choose to take all of your AVC LGPS before your 75th birthday.
45
You may have to retire at your For benefits built up from April 2014,
employer’s instigation, perhaps because your normal pension age is linked to
of redundancy, business efficiency or your state pension age (but with a
permanent ill health. Your LGPS benefits, minimum of age 65). It is the age at which
even in these circumstances will, you can take the pension you have built
provided you have met the two-years’ up in full. If you choose to take your
vesting period in the scheme and (in the pension before your normal pension
case of retirement due to redundancy or age, it will normally be reduced, as it's
business efficiency) you are aged 55 or being paid earlier. If you take it later than
over, provide you with an immediate your normal pension age, it's increased
retirement pension. because it's being paid later.
If you voluntarily choose to retire before, Please note that if you were in the LGPS
on or after your normal pension age, before 1 April 2014 your benefits built up
you can defer taking your benefits but before that date will have a different
you must take them before age 75. If you normal pension age, which for most
take your pension after your normal is age 65.
pension age, your benefits will be
paid at an increased rate to reflect late For further information on when benefits
payment. built up before 1 April 2014 are payable,
see the section If You Joined the LGPS
There are specific rules relating to each Before 1 April 2014.
type of retirement; this section looks at
the different ways of retiring, and the If the state pension age changes in
implications. the future, how does this affect my
LGPS pension?
Voluntary retirement As the normal pension age is linked to
state pension age, any changes to
You can voluntarily retire and take state pension age in the future will
retirement benefits at any age between apply to all the pension you build up in
age 55 and 75, provided you have met the scheme after 31 March 2014. That
the two-years’ vesting period in the means that the age when you can take
scheme. your pension without any actuarial
reduction or actuarial increase to your
Voluntary retirement at normal pension will change.
pension age
You can voluntarily retire and take your If you built up membership in the LGPS
benefits in full at your normal pension before April 2014 then you will have
age. membership in the final salary scheme.
46
These benefits have a different normal Will my pension be reduced if I

pension age, which for most is age 65. voluntarily retire before my normal
pension age?
For further information on when benefits If you choose to retire before your
built up before 1 April 2014 are payable, normal pension age, your benefits
please read the section If You Joined will normally be reduced to take account
the LGPS Before 1 April 2014. of being paid for longer. Your benefits
are initially calculated as detailed under
Choosing to retire and draw your the heading How your pension is
pension benefits before your normal worked out and are then reduced.
pension age How much your benefits are reduced by
You can choose to retire and take your depends on how early you take them.
pension from age 55. You do not need
your employer’s consent to take your The reduction is calculated in accordance
pension before your normal pension with guidance issued by the Secretary
age. Your pension is normally reduced if of State from time to time. The reduction
it is paid before your normal pension is based on the length of time (in years
age. and days) that you retire early – ie, the
period between the date your benefits
If you built up pension in the LGPS are paid and your normal pension age.
before 1 April 2014 then protections are The earlier you retire, the greater the
in place for the normal pension age reduction.
that applies to those benefits. In addition,
if you were a member of the LGPS at As a guide, the percentage reductions
any time between 1 April 1998 and (effective from 8 January 2019) for
30 September 2006, you may have ‘rule retirements up to 13 years early are
of 85’ protections which mean that if you shown in the table overleaf. Where the
voluntarily retire before your normal number of years is not exact, the
pension age you will not suffer an reduction percentages are adjusted
actuarial reduction to some or all your accordingly.
benefits, or the reduction that will apply is
lower than the reduction that would apply
if you had no Rule of 85 protections.
To find out more on protections for pre-1
April 2014 membership please read the
section If You Joined the LGPS Before
1 April 2014.
47
Number of years paid early Pension reduction Lump sum reduction

0 0.0% 0.0%
1 5.1% 2.3%
2 9.9% 4.6%
3 14.3% 6.9%
4 18.4% 9.1%
5 22.2% 11.2%
6 25.7% 13.3%
7 29.0% 15.3%
8 32.1% 17.3%
9 35.0% 19.2%
10 37.7% 21.1%
11 41.6% N/A
12 44.0% N/A
13 46.3% N/A
Your employer can agree not to make your benefits paid early could be
any reduction. This is a discretion and protected from the reduction if you are
you can ask them what their policy on a ‘rule of 85’ protected member. You
this is. can find out more about ‘rule of 85’
protections from the section If You
You can reduce or avoid the reductions Joined the LGPS Before 1 April 2014.
by not taking immediate payment of
your benefits on early retirement, ie, by Choosing to carry on working after
delaying payment until a later date. If you your normal pension age
decide not to take immediate benefits, the If you choose to carry on working after
benefits would normally become payable normal pension age, you will continue
at your normal pension age. You can to pay into the LGPS, building up further
defer payment beyond that age, but your benefits. When you eventually retire you
benefits must be paid by age 75. will receive your pension unless you
If you were a member of the LGPS at choose to delay taking it. You must take
any time between 1 April 1998 and your pension by age 75.
30 September 2006, some or all of
48
To take account of the fact that you will Ill-health retirement

be taking your pension after your normal
pension age, your benefits will be paid What happens if I have to retire early
at an increased rate based on the period due to permanent ill health?
between your normal pension age and If you have to leave work due to illness,
your retirement date. you may be able to receive immediate
payment of your benefits.
Early retirement through To qualify for ill-health benefits, you
redundancy or business have to have met the two-years’
efficiency vesting period in the scheme and
your employer, based on an opinion
What happens if I lose my job through from an independent occupational health
redundancy or business efficiency? physician appointed by them, must be
If you are age 55 or over, your main satisfied that you will be permanently
LGPS benefits are payable immediately unable to do your own job until your
without any early retirement reductions normal pension age and that you are
if your employer makes you redundant not immediately capable of undertaking
or you are retired on the grounds of gainful employment.
business efficiency and you have met
the two-years’ vesting period in the Ill-health benefits can be paid at any age
scheme. However, any additional and are not reduced on due to early
pension paid for by APCs or SCAPCs payment – in fact, your benefits could be
would be paid at a reduced rate if the increased to make up for your early
retirement occurred before your normal retirement. There are graded levels of
pension age (to take account of the benefit based on how likely you are to be
additional pension being paid for longer). capable of gainful employment after you
leave.
If you were a member of the LGPS
before 1 April 2014, the pension you built There are graded levels of benefit based
up before then is based on your final on how likely you are to be capable of
pay when you leave the scheme, please gainful employment after you leave.
read the section If You Joined the
LGPS Before 1 April 2014. Also, any The different levels of benefit are:
additional pension bought by additional • Tier 1: If you are unlikely to be
regular contributions would be paid at a capable of gainful employment
reduced rate if the retirement occurred before your normal pension age,
before your pre-1 April 2014 normal ill-health benefits are based on the
pension age which, for most, is age 65. pension you have already built up in
49
your pension account at your date of become payable again from your
leaving the scheme plus the pension normal pension age, but there are
you would have built up, calculated on provisions to allow it to be paid earlier.
assumed pensionable pay, had you Details would be provided at the time.
been in the main section of the scheme
until you reached your normal Gainful employment means paid
pension age. employment for not less than 30 hours
in each week, for a period of not less
• Tier 2: If you are unlikely to be than 12 months.
capable of gainful employment
within three years of leaving, but If you have previously received a Tier 1
are likely to be capable of ill-health pension from the LGPS, or were
undertaking such employment awarded a LGPS ill health pension before
before your normal pension age, 1 April 2008, then no enhancement can
ill-health benefits are based on the be added to your pension account if
pension you have already built up in you are retired again for reasons of
your pension account at your date of ill health.
leaving the scheme plus 25% of the If you have previously received a Tier 2
pension you would have built up ill-health pension from the LGPS, any
calculated on assumed pensionable enhancement due upon a subsequent
pay, had you been in the main section ill-health retirement is adjusted and
of the scheme until you reached your capped. If, in respect of the subsequent
normal pension age. ill-health retirement, you are awarded a
• Tier 3: If you are likely to be capable Tier 1 or Tier 2 pension, the enhancement
of gainful employment within three cannot exceed three quarters of the
years of leaving, or before your number of years between the initial
normal pension age if earlier, ill-health retirement and your normal
ill-health benefits are based on the pension age, less the number of years
pension you have already built up in of active membership since the initial
your pension account at leaving. ill-health retirement.
Payment of these benefits will be Where an enhancement is payable, the
stopped after three years, or earlier additional pension is added to your
if you are in gainful employment or pension account.
become capable of such employment,
provided you have not reached your If an independent registered medical
normal pension age by then. If the practitioner certifies that, during the
payment is stopped, it will normally period used to determine assumed
50
pensionable pay, you were working paying into the LGPS, building up further
reduced contractual hours because of the benefits in the scheme.
ill health which led to your retirement,
the assumed pensionable pay is to be Your election to receive benefits must be
calculated on the pay you would have made to the Fund.
received during that period had you not
been working reduced contractual hours. Do I have to draw all my pension
benefits if I take flexible retirement?
If you were paying into the LGPS before If your employer agrees to flexible
1 April 2014, the pension you built up retirement, then you would have to
before then is based on your final pay take:
when you leave the scheme. To find out
more on protections for pre-1 April 2014 • all of the benefits that relate to any
membership, please read the section If pre-1 April 2008 membership, plus
You Joined the LGPS Before 1 April 2014. • all, none or some of the benefits that
relate to your membership from 1 April
Flexible retirement 2008 to 31 March 2014, plus
Can I have a gradual move into • all, none or some of the benefits that
retirement? relate to your pension built up from
Rather than continuing in your job to your 1 April 2014, plus
normal pension age or beyond, you
may wish to consider the possibility of • any additional benefits bought under
flexible retirement. From age 55, if you an added years contract which
reduce your hours or move to a less commenced before 1 October 2006 or
senior position, and provided you have derived from an AVC contract that
met the two-years’ vesting period in commenced before 13 November
the scheme and your employer agrees, 2001, plus
you can take some or all of the pension
benefits you have built up, helping you • any additional pension being purchased
ease into retirement. You can ask your either through APCs, SCAPCs or ARCs,
employer for details of their policy on any additional pension awarded by
flexible retirement. your employer and any benefits
derived from an AVC contract that
If your employer agrees to flexible commenced on or after 13 November
retirement you can still receive your 2001 (should you choose to take
wages/salary from your job on the these).
reduced hours or grade and continue
51
Will my pension and lump-sum be your pension about your new

reduced if I take flexible retirement? employment, regardless of whether you
If you take flexible retirement before join the scheme in your new job or not.
your normal pension age, your They will let you know whether your
benefits, initially calculated as detailed pension in payment is affected in any
under the heading Choosing to retire way.
and draw your pension benefits
before your normal pension age will If you take flexible retirement after your
normally be reduced for early payment. normal pension age, your benefits will
be increased to reflect late payment. See
If you were a member of the LGPS at the section above Choosing to carry on
any time between 1 April 1998 and working after your normal pension
30 September 2006, some or all of age for more information.
your benefits paid early could be
protected from the reduction if you are More about your LGPS
a ‘rule of 85’ protected member. You
can find out more about ‘rule of 85’
retirement benefits
protections from the section If You What are the HM Revenue and
Joined the LGPS Before 1 April 2014. Custom tax controls on my LGPS
benefits?
Your employer may, however, determine
There are HM Revenue and Customs
not to apply all or part of any reduction.
controls on the pension savings you can
You can ask them what their policy on
have before you become subject to a tax
this is.
charge when you take them (over and
If you receive payment of your benefits above any tax due under the PAYE
on flexible retirement, then your benefits system on a pension in payment).
will not be subject to reduction or
You can find out about HM Revenue
suspension for re-employment while
and Customs controls on your pension
you are in a job with the employer that
savings from the section on Tax Controls
allowed you to take flexible retirement.
and Your LGPS Benefits.
However, if you leave and are
re-employed in local government or Under HM Revenue and Custom rules,
by an employer who offers membership if the LGPS makes an unauthorised
of the LGPS and part of your pension in payment there will be a tax charge. If you
payment is in respect of pension you built pay some or all of your LGPS lump sum
up prior to 1 April 2014, you must tell the back into a pension arrangement, there
LGPS administering authority that pays may be a tax charge.
52
How does my pension keep its value? A new single-tier, flat-rate state pension
On retiring on or after age 55, your LGPS has been introduced for people who
pension increases in line with the cost reach state pension age on or after
of living every year throughout your 6 April 2016. It replaces the basic and
retirement. If the cost of living additional state pension that is payable to
increases, so will your pension. If you people who reached state pension age
are retired on ill-health grounds, your before 6 April 2016. You will be able to
pension is increased each year claim the new state pension when you
regardless of your age. reach state pension age if you’re...
Guaranteed minimum pension (GMP) • a man born on or after 6 April 1951

If your membership in the LGPS includes • a woman born on or after 6 April 1953
a guaranteed minimum pension
(GMP), then at age 60 (women) or 65 ...and, normally, have at least ten years
(men) or at the date of your retirement if qualifying years on your national
later, your LGPS pension for membership insurance record.
before 6 April 1997 will be compared
with your GMP and increased to the rate If you do not know your state pension
of your GMP should this be higher. In age, you can use the state pension age
most cases, your LGPS pension is higher calculator to find this out.
than your GMP. You should be aware that, as a member
If you retire and choose not to take your of the LGPS, if you are eligible for the
pension immediately, the GMP element new state pension you might not receive
(if any) of your pension must be paid the full amount. This is because as a
from age 60 (women) or 65 (men), unless member of the LGPS you are likely to
you are still in some employment at that have paid a lower amount of national
time and consent to postponement of insurance in previous years.
payment of your GMP. More information about this and the
new state pension can be found at
Information about your www.gov.uk/yourstatepension
state retirement pension Since 2010, state pension age for
In addition to your LGPS benefits, you women has gradually increased to be
may also qualify for a state retirement equalised with that for men and reached
pension paid by the government from age 65 in November 2018.
state pension age.
53
State pension age equalisation timetable for women

Date of birth New state pension age
Before 6 April 1950 60
6 April 1950 - 5 April 1951 In the range 60 - 61
6 April 1953 - 5 August 1953 In the range 63 - 64
6 August 1953 - 5 December 1953 In the range 64 - 65
The state pension age will increase to 66 for both men and women between
December 2018 and October 2020.
Increase in state pension age from 65 to 66 for men and women
6 December 1953 - 5 October 1954 In the range 65 - 66
After 5 October 1954 66
Under current legislation, the state The national website for members
pension age is due to rise to 67 between of the LGPS is www.lgpsmember.org
2026 and 2028 and to 68 between 2044
and 2046. However, the Government has You can find out about what you can do
announced plans to bring forward the rise if you are not happy about a decision
to 68 to between 2037 and 2039. made about your LGPS pension position
To find out your state pension age, Problems.
please visit:www.gov.uk/calculate-
state-pension
More information
For more information or if you have a
benefits, please contact the Fund. Contact
booklet.
54
Transferring Pension Rights Into the LGPS
In this section, we look at transferring previous pension rights

into the LGPS.
Where pension terms are used, they If you have previous LGPS
appear in bold italic type. These terms pension rights in England or
section.
Wales
If you rejoin the LGPS after having
You may be able to transfer pension
previously built up LGPS pension rights
rights into the LGPS from:
(ie, you previously left an LGPS
• a previous LGPS fund, or employment with deferred benefits) then
these deferred benefits can be joined
• a previous employer's pension with your new active pension account
scheme, or in the scheme unless you became entitled
to the deferred benefit as a result of
• a self-employed pension plan, or
making an election, on or after 11 April
• a ‘buy-out’ policy, or 2015, to opt out of membership of the
scheme. If that is the case, you will not
• a personal pension plan, or be permitted to join the two periods of
• a stakeholder pension scheme, or membership together and, instead, you
will have two separate sets of pension
• an AVC arrangement benefits in the scheme.
including, in some cases, from an If you rejoin the LGPS after having
overseas pension scheme. previously left an LGPS employment
without building up rights to a deferred
You cannot transfer a pension credit into pension, but you deferred taking a refund
the LGPS. A pension credit is a share of of contributions (normally where you
an ex-spouse's or ex-civil partner's have less than two years membership),
pension benefits, as awarded by a court then this deferred refund must be joined
under a pension sharing order, or by a with your new active pension account
qualifying agreement in Scotland, in the scheme.
following a divorce or a dissolution of
a civil partnership. Where you have more than one
employment and therefore more than
one pension account in the LGPS, you
can elect which account to aggregate
your previous LGPS pension rights with.
55
I have deferred benefits in the LGPS with deferred benefits, provided you
in England or Wales (which I did not did not have a continuous break of
become entitled to as a result of more than five years in active
making an election, on or after 11 April membership of any public service
2015, to opt out of membership of the pension scheme, your deferred
scheme). What happens to these when benefits will automatically be joined
I rejoin the scheme? with your new pension account (or,
When you rejoin the LGPS, you have where the deferred benefits arose from
12 months from rejoining (or such longer the cessation of a concurrent job, will
period as your employer may allow) to be joined with the pension account
elect to keep your deferred benefits from the ongoing employment) unless
separate from your new pension you elect within 12 months of rejoining
account otherwise these deferred to keep your deferred benefits sepa
benefits are automatically joined with rate. If the benefits are joined and you
your new pension account. have more than one pension account
you will need to choose which account
Where you have more than one the deferred benefits are to be added
employment and therefore more than to.
one active pension account in the
LGPS, you can elect which account to Where the benefits are joined, the
aggregate your deferred benefits with. pension from the former employment
which you built up on or after 1 April
Special rules apply if you were a member 2014 will be added to your active
of the LGPS in England or Wales on or pension account.
before 31 March 2014. These are set out
below. The membership you built up before
1 April 2014 will continue to provide
• If you were a member of the LGPS you with a final salary benefit, with
on both 31 March 2014 and 1 April your final pay when you leave the
2014 and subsequently: active employment used to work out
- left an employment the benefits for your pre-1 April 2014
membership.
- opted out before 11 April 2015, or
• If you were a member of the LGPS
- opted out of one employment but on both 31 March 2014 and 1 April
remained an active member in 2014 and subsequently left an
another concurrent employment employment (or opted out before
11 April 2015) with deferred benefits,
56

2016
with a continuous break of more than If you choose to be treated as a

five years in active membership of any member of the scheme on these dates,
public service pension scheme, your membership built up before
your deferred benefits will 1 April 2014 will automatically be
automatically be joined with your new
pension account unless you elect joined with your new pension
within 12 months of rejoining to keep account and will continue to be
your deferred benefits separate. If the calculated as a final salary benefit,
benefits are joined and you have more with your final pay when you leave
than one pension account you will the active employment used to work
need to choose which account the out the benefits for your pre-1 April
deferred benefits are to be added to. 2014 membership.
Where the benefits are joined, the If you do not choose to be treated as a
pension from the former employment member of the scheme on 31 March
which you built up on or after 1 April 2014 and 1 April 2014, you can elect
2014 will be added to your active for the membership you built up before
pension account. 1 April 2014 to purchase an amount of
pension under the rules of the scheme
The membership you built up before at the time of the transfer and this will
1 April 2014 will purchase an amount be added to your active pension
of pension under the rules of the account. If you do not make such an
scheme at the time of the transfer election, you will retain separate
and this will be added to your active deferred benefits.
pension account.
• If you were a member of the LGPS
• If you were a member of the LGPS before 31 March 2014 and left an
before 31 March 2014 and left an employment (or opted out) before this
employment (or opted out) before this date with deferred benefits with a
date with deferred benefits then, continuous break of more than five
provided you did not have a continuous years in active membership of any
break of more than five years in active public service pension scheme and
membership of any public service you rejoined the LGPS after 31 March
pension scheme and you rejoined the 2014, you can elect for these deferred
LGPS after 31 March 2014, you can benefits to be transferred to your new
elect within 12 months of rejoining to pension account. Where you elect for
be treated as a member of the scheme that to happen, the membership you
on 31 March 2014 and 1 April 2014. built up before 1 April 2014 will
57
purchase an amount of pension under Special rules apply if you were a member
the rules of the scheme at the time of of the LGPS in England or Wales on or
the transfer and this will be added to before 31 March 2014. These are set out
your active pension account. If you below.
do not make such an election you will
retain separate deferred benefits. • If you were a member of the LGPS
on both 31 March 2014 and
In any of the above situations, if you 1 April 2014 and subsequently left an
elect to keep your deferred benefits employment (or opted out) with a
separate from your new active pension deferred refund, provided you did not
account, then the value of the deferred have a break of more than five years in
benefits will increase to keep up with the active membership of the LGPS in
cost of living. England or Wales your deferred refund
will automatically be joined with your
I have a deferred refund in the LGPS new pension account (or, where the
in England or Wales. What happens to deferred refund arose from the
this refund when I rejoin the scheme? cessation of a concurrent job,
When you rejoin the LGPS you must, if automatically be joined with the
you have not had a break of more than pension account from the ongoing
five years in active membership of the employment). If you have more than
LGPS in England or Wales, combine the one active pension account you will
pension in your deferred refund account need to choose which one the deferred
with your new active pension account. refund is to be added to.
Where you have more than one The pension from the former
employment and therefore more than employment which you built up on or
one active pension account in the after 1 April 2014 will be added to
LGPS, you can elect which account to your active pension account.
aggregate your deferred refund with.
The membership you built up before
However, if you have had a break of 1 April 2014 will continue to be
more than five years in active calculated as a final salary benefit,
membership of the LGPS in England with your final pay when you leave
or Wales, you will not be able to the active employment used to work
combine the pension in your deferred out the benefits for your pre-1 April
refund account with your new active 2014 membership.
pension account and must, instead,
take a refund of contributions.
58
However, if you did have a break of If you have pension rights in a

more than five years in active non-LGPS arrangement
membership of the LGPS in England
or Wales, you will not be able to If you have paid into a non-LGPS pension
combine your deferred refund with arrangement, you may be able to transfer
your new active pension account your previous pension rights into the
and must, instead, take a refund of LGPS. A non-LGPS arrangement must be
contributions. another registered pension scheme
or a European pensions institution.
• If you were a member of the LGPS For details on how, under Club transfer
before 31 March 2014 and left an rules, transfers from another public
employment (or opted out) before this service pension scheme are treated,
date with a deferred refund and including a transfer from the LGPS in
subsequently rejoined the LGPS after Scotland or Northern Ireland, see
31 March 2014, your deferred refund Transfers from another public service
will purchase an amount of pension pension scheme below.
under the rules of the scheme at the
time of the transfer and this will be You have only 12 months from joining the
added to your active pension LGPS to opt to transfer your previous
account. pension rights, unless your employer and
your administering authority, the City of
To find out more on protections for Wolverhampton Council, allow you
membership built up before 1 April 2014 longer. This is a discretion and you can
and see how this is calculated read the ask your employer and administering
section If You Joined the LGPS Before authority, the City of Wolverhampton
1 April 2014. If you wish to transfer your Council, what their policy is on this.
previous LGPS pension rights, you should
contact the Fund as soon as possible to If you opt to transfer pension rights from
find out about this and about the matters a non-LGPS arrangement then a sum of
you will need to consider in making your money called a transfer value is
decision. offered to buy an amount of extra
pension which would be added to your
Pension rights built up as a councillor or pension account. If you transfer your
mayor in England or Wales cannot be previous pension rights into the LGPS
joined with rights built up as an employee your retirement benefits will be
in England or Wales and vice versa. increased. The extra pension is added
59
to your pension account in the Transferring your pension rights is not

scheme year that the transfer always an easy decision to make, and
payment is received. you may wish to seek the help of an
Any request you make to investigate a independent financial adviser.
transfer will not be binding until you have
been supplied with full details of the Your administering authority, the City of
amount of extra pension the transfer Wolverhampton Council, may decline to
payment would buy and subsequently accept a transfer from a non-LGPS
confirm that you wish the transfer to go arrangement.
ahead. Transfer quotations provided by a
former pension provider are generally If you have pension rights with
guaranteed for three months. another public service pension
You will need to consider carefully
scheme
whether to transfer or not, as a transfer If you have previously been a member of
may not always be advantageous. another public service pension scheme
You should compare the amount of extra and:
pension the transfer payment would buy
in the LGPS, when that pension is • you have not had a break of more than
normally payable from (ie, your normal five years between leaving another
pension age) and the other LGPS public service pension scheme
benefits (eg, the ability to retire and take (including the LGPS in Scotland or
benefits earlier than normal pension Northern Ireland) and joining the LGPS
age, death and survivor benefits, etc) in England and Wales and
against the value of the package of
• your election to transfer pension rights
benefits if left with your previous pension
from that other public service
scheme provider.
pension scheme is made within
Transfers from public sector schemes are 12 months of joining the LGPS in
treated differently if transferred in under England and Wales,
Club transfer rules. See If you have
Under the Club transfer rules if you
pension rights with another public
opt to transfer pension rights from a
service pension scheme below for
public service pension scheme the
more information on this type of transfer.
amount of extra pension which is added
to your pension account will be equal to
the amount of pension you had built up in
your pension account with your previous
60
pension scheme (increased by that to the pension you would have received
scheme’s ‘in-service’ revaluation rate if in the LGPS if the scheme had not
there had been a break between leaving changed on 1 April 2014. To find out
that scheme and joining the LGPS and more about the underpin read the section
adjusted to take account of differences in If You Joined the LGPS Before 1 April
the schemes). 2014.
The extra pension would be added to
your pension account in the LGPS in the
I have a personal or
scheme year that the transfer payment stakeholder pension plan.
is received. Can I continue paying into it?
Also, under the Club transfer rules, If you have a personal or stakeholder
where a transfer from another public pension plan, you can continue to pay
service pension scheme includes a into it at the same time as paying into
final salary element (membership built up the LGPS or, alternatively, you can stop
in a final salary scheme which in most paying into it and consider transferring it
cases is membership up to 31 March into the LGPS.
2015) that element would buy final
salary scheme membership in the LGPS You can, if you wish, pay up to 100% of
provided you have not had a continuous your total UK taxable earnings in any one
break in active membership of a public tax year into any number of concurrent
service pension scheme of more than pension arrangements of your choice (or,
five years. The transfer value will give if greater, £3,600 to a ‘tax relief at source’
you broadly equivalent benefits in the arrangement, such as a personal pension
LGPS, provided you apply for the transfer or stakeholder pension scheme) and
within 12 months of joining the LGPS. be eligible for tax relief on those
contributions. Under HM Revenue
If you were an active member of the and Customs rules there are controls
other public service pension scheme on the pension savings you can have
on 31 March 2012 and were within ten before you become subject to a tax
years of age 65 on 1 April 2012, you may charge. Most people will not be affected
qualify for the underpin protection in the by these controls. To find out more, see
LGPS. The underpin protection means the section on Tax Controls and Your
that you will get a pension at least equal LGPS Benefits.
61
I have paid AVCs. Can I transfer How do I transfer?

them into the LGPS? The Fund can advise you of their process
If you have paid AVCs to the LGPS in for transferring previous pension rights
England or Wales, the accrued value of into the LGPS. Remember, you only
your AVCs must be transferred to an have 12 months from joining the LGPS to
AVC arrangement offered by your new opt to transfer your previous pension
administering authority if you transfer rights, unless your employer and, in the
your main scheme benefits. case of a transfer from a non-LGPS
scheme, your administering authority,
However, there is an exception to this the City of Wolverhampton Council,
rule. If you were previously a member of allows you longer.
the LGPS on 31 March 2014 and 1 April
2014 (or you were not a member on I’ve lost touch with my previous
those dates but elect within 12 months of
returning to the LGPS to be treated as if
pension provider. Who can help?
you had been a member on those dates) You may have lost touch with your
and you do not have a continuous break former pension schemes but, if you
in active membership of a public have, don’t worry as The Pension
service pension scheme of more Tracing Service can help. It holds
than five years, you can choose not to details of almost 200,000 UK pension
transfer the accrued value of your schemes and provides a tracing
AVCs to an AVC arrangement offered service free of charge. You can contact
by your new administering authority. The Pension Tracing Service:
If you have paid AVCs to a scheme In writing:
(other than to the LGPS in England or The Pension Tracing Service
Wales) or you have paid FSAVCs, you The Pension Service 9
may be able transfer your accrued AVC Mail Handling Site A
fund into the main LGPS pension scheme. Wolverhampton,
An election to do so must be made within WV98 1LU
12 months of joining the LGPS, unless
your employer exercises a discretion to By telephone:
allow you longer. You can ask your 0800 731 0193
employer what their policy is on this. Or website:
www.gov.uk/find-lost-pension
62
Don’t forget to keep your pension

providers up to date with any
change in your home address.
More information
For information on how your LGPS
pension is worked out, see the section
on Your Pension.
booklet.
The national website for members
of the LGPS is www.lgpsmember.org
Problems.
63
Leave of Absence and the LGPS
In this section, you can find out about how the pension you
built up in the LGPS could be affected if you are off work for
any reason.
Where pension terms are used, they pay or incapacity benefit). If you are on
appear in bold italic type. These terms unpaid sick leave, you will not pay any
are defined in the Some Terms We Use contributions.
section.
If you are in the 50/50 section and go on
There are many reasons for absence and to unpaid sick leave, you will
each has a different effect on the pension automatically be moved to the main
you build up in the LGPS. section of the scheme from the beginning
of the next pay period if you are still on
What happens if I am no pay at that time. This means from
on sick leave? that point forward you will build up full
pension benefits in the LGPS even though
If you are off work due to sickness or you are not paying pension contributions.
injury and your contractual pay is
reduced or you don’t receive any pay, What happens if I am on
then the pensionable pay figure used to maternity, adoption or paternity
work out your pension for this period is
your assumed pensionable pay. Using
leave or shared parental leave?
your assumed pensionable pay, rather During any period of relevant child-
than the amount of pensionable pay related leave, the pensionable pay
you actually receive when on sick leave, figure used to work out your pension is
means that you will continue to build up a your assumed pensionable pay 7.
pension in the section of the LGPS you Using your assumed pensionable
are in, as if you were working normally pay (if this is higher than your actual
and receiving pay. pensionable pay received), rather than
the amount of pensionable pay you
You will continue to pay your basic
actually receive when on relevant
LGPS contributions on any pay that you
child-related leave, means that you
receive while you are off sick (before any
will continue to build up a pension in the
reduction on account of statutory sick
7
Unless the value of your pensionable pay received is greater than the value of your assumed
pensionable pay. In such cases, the value of the pensionable pay you received is used to work out
your benefits, as it would be higher than the value of your assumed pensionable pay.
64
section of the LGPS you are in, as if you your employer. You will pay one-third of
were working normally and receiving the cost and your employer will pay the
pay. rest. This is known as an SCAPC. You can
pay these additional contributions in a
You will continue to pay your basic one-off lump-sum or through regular
LGPS contributions on any pay that you payments from your wages.
receive while you are off on relevant
child-related leave. The maximum period of absence you can
elect to buy back by a SCAPC is three
If you are in the 50/50 section and go years.
on to no pay during ordinary maternity,
paternity or adoption leave, you will You can obtain a quote and print off an
automatically be moved to the main application form to buy lost pension at
section of the scheme from the beginning www.lgpsmember.org
of the next pay period. This means from If you have membership of the LGPS
that point forward, you will build up full before 1 April 2014, you will have built
pension benefits in the LGPS even though up benefits in the final salary scheme.
you are not paying pension contributions. If you choose to pay for the lost pension
Any period of unpaid additional maternity in the scheme the amount you pay will
or adoption leave or unpaid shared go towards covering any protections
parental leave will not count for pension associated with your pre-1 April 2014
purposes, unless you elect to pay APCs membership. To find out more, see the
to purchase the amount of pension lost section If You Joined the LGPS Before
during that period of unpaid absence. 1 April 2014.
The amount of pension lost is calculated If you have ‘keep in touch’ (KIT) day(s)
as the appropriate fraction of your lost or ‘shared parental leave in touch’
pensionable pay for that period of (SPLIT) day(s) during a period of unpaid
absence (ie, 1/49th of your lost additional maternity or adoption leave or
pensionable pay if you were in the unpaid shared parental leave, you will
main section of the scheme or 1/98th build up a pension (based on the section
if you were in the 50/50 section). of the scheme you are in) for the day(s)
you are paid.
If you wish to purchase the amount of lost
pension and make the election within 30 You can contact the Fund for further
days of returning to work (or such longer information on paying APCs.
period as your employer allows), then the
cost of the APC is split between you and
65
What happens if I am granted If you have membership of the LGPS

unpaid leave of absence? before 1 April 2014, you will have built
up benefits in the final salary scheme.
If you are granted unpaid leave of If you choose to pay for the lost pension
absence, including jury service, the in the scheme the amount you pay will
period will not count for pension go towards covering the protections
purposes unless you elect to pay APCs associated with the pre-1 April 2014
to purchase the amount of pension membership. To find out more, see the
lost during that period of absence. section If You Joined the LGPS Before
The amount of pension lost is calculated 1 April 2014.
as the appropriate fraction of your lost
pensionable pay for that period of You can contact the Fund for further
absence (ie, 1/49th of your lost information on paying APCS.
pensionable pay if you were in the
main section of the scheme or 1/98th What happens if I am on strike?
if you were in the 50/50 section).
If you are absent for a day or more due
If you wish to purchase the amount of lost to a trade dispute the period will not count
pension and make the election within 30 for pension purposes unless you elect to
days of returning to work (or such longer pay APCs to purchase the amount of
period as your employer allows), then the pension lost during that period of
cost of the APC is split between you and absence. The amount of pension lost is
your employer. You will pay one-third of calculated as the appropriate fraction of
the cost and your employer will pay the your lost pensionable pay for that
rest. This is known as an SCAPC. You can period of absence (ie, 1/49th of your
pay these additional contributions in a lost pensionable pay if you were in the
one-off lump-sum or through regular main section of the scheme or 1/98th if
payments from your wages. you were in the 50/50 section).
The maximum period of absence you The cost of purchasing the amount of
can elect to buy back by an SCAPC is a lost pension for the period of absence
period of three years. would be met fully by you (unless your
employer voluntarily chooses to pay part
You can obtain a quote and print off an of the cost of the APC).
application form to buy lost pension at
www.lgpsmember.org You can obtain a quote and print off an
application form to buy lost pension at
www.lgpsmember.org
66
If you have membership of the LGPS You will need to pass this information on
before 1 April 2014, you will have built to the MoD. Your employee contributions
up benefits in the final salary scheme. (and any additional contributions you are
If you choose to pay for the lost pension paying in the LGPS) will be deducted by
in the scheme the amount you pay will the MoD and paid across to your
go towards covering any protections administering authority, the City of
associated with your pre-1 April 2014 Wolverhampton Council, together with
membership. To find out more, see the the employer contributions due.
section If You Joined the LGPS Before
1 April 2014. What if I am paying extra?
You can contact the Fund for further If you have...
information on paying APCs.
contract to buy extra pension (ARCs)
What happens if I am on or,
reserve forces service leave?
If you are on reserve forces service contract to count pre-6 April 1988
leave and elect to remain in the LGPS membership for a surviving eligible
your pension in the scheme will be cohabiting partner’s pension or,
worked out using your assumed
pensionable pay. Using your assumed • before 1 April 2008 entered into a
pensionable pay ensures that you will contract to buy extra LGPS
continue to build up pension as if you membership (added years),
were in work rather than on reserve
forces service leave. Any pay you do by paying extra pension contributions and
you are absent from work due to:
receive from your employer will not have
pension contributions deducted from it. • sickness or injury on full or reduced
pay
If you go on reserve forces service
leave and elect to stay in the LGPS, your • relevant child-related leave
employer needs to tell you the amount of
basic pension contributions you and the • authorised leave of absence
Ministry of Defence (MoD) must pay, the
• a trade dispute or
amount of any additional contributions
you are paying in the LGPS, and the • reserve forces service leave where
amount of assumed pensionable pay your reserve forces leave pay is equal
those contributions must be collected on. to or greater than your normal pay,
67
you must continue to pay the extra If you have:

pension contributions you had contracted
to pay as if you were not on leave. • entered into a contract to pay APCs or
Where necessary, these can be collected to pay shared cost APCs,
from your pay when you return to work. and you are absent from work due to:
If you are absent from work due to
sickness or injury on no pay, or are on • sickness or injury on full or reduced
reserve forces service leave where pay
your reserve forces leave pay is less than
your normal pay, the extra contributions • relevant child-related leave
are deemed to have been paid. • authorised leave of absence
If you have: • a trade dispute or
• entered into a contract to buy-back • reserve forces service leave
some previous part-time service by
paying extra pension contributions you must continue to pay the extra
pension contributions you had contracted
and you are absent from work due to: to pay as if you were not on leave.
• sickness or injury on full, reduced or no Where necessary, these can be collected
pay from your pay when you return to work.
If you are absent from work due to
• relevant child-related leave sickness or injury on no pay the extra
contributions are deemed to have been
• authorised leave of absence
paid.
• a trade dispute or If you are:
• reserve forces service leave • paying AVCs or SCAVCs which
you must continue to pay the extra commenced on or after 1 April 2014,
pension contributions you had contracted and you are absent from work due to
to pay as if you were not on leave. sickness or injury on reduced contractual
Where necessary, these can be collected or no pay, relevant child-related leave
from your pay when you return to work. or reserve forces service leave then
you can continue to make payments in
respect of any such AVC or SCAVC
contracts.
68
If you are paying AVCs for extra life cover

you should arrange to continue with these
payments throughout your leave or cover
may cease.
Where necessary, your employer will
contact you about making the relevant
contributions.
More information
booklet.
Problems.
69
Leaving Your Job Before Retirement
In this section, we look at what happens to your LGPS benefits

on leaving your job before retirement if you pay into the LGPS
on or after 1 April 2014.
Where pension terms are used, they second pension (S2P) in respect of
appear in bold italic type. These terms your membership up to 5 April 2016
are defined in the Some Terms We Use when the LGPS was contracted out of
section. the S2P. Interest is paid if the refund is
not made within one year of leaving,
Vesting period for LGPS but no refund can be made if you rejoin
the scheme in England or Wales within
pension entitlement a month and a day of leaving or rejoin
If you leave your job before retirement before the refund has been paid; and
and have met the two-years’ vesting
• you may be able to transfer your
period, you will have built up an
benefits to a new pension arrangement
entitlement to a pension. You will have
(providing you have been a member of
two options in relation to that pension
the LGPS for at least three months);
entitlement:
and
• you can choose to keep your benefits
• you can delay your decision until you
in the LGPS. These are known as
either rejoin the LGPS, transfer your
deferred benefits and will increase
benefits to a new pension
every year in line with the cost of
arrangement, or want to take a refund
living, or
of contributions. If you delay your
• alternatively, you may be able to decision you will have what is known
transfer your deferred benefits to as a deferred refund pension
another pension arrangement. account. Please note that the deferred
refund account can only be held for a
If you leave your job before retirement maximum of five years or until age 75,
and have not met the two-years’ vesting whichever is earlier. If you have not
period, you will have three options: transferred your benefits to a new
pension arrangement or rejoined the
• you will normally be able to claim a
LGPS by that time, a refund of
refund of your contributions, less a
contributions will automatically be
deduction for tax and the cost, if any,
payable to you.
of buying you back into the state
70
If you have not met the two-years’ above base rate from the date you left the
vesting period when you leave but scheme to the day the refund is paid
joined before 1 April 2014 and you have (compounded with three monthly rests).
three or more months’ membership, you
will have an entitlement to a deferred Your refund of contributions must be paid
benefit instead of a refund (but you can within five years of your leaving the
opt within six months of leaving to scheme (or age 75 if earlier). At that
receive a refund if you wish). point, a refund of contributions is
automatically paid to you.
If I'm eligible for a refund of No refund can be made if you rejoin the
contributions, how is this scheme in England or Wales within a
worked out? month and a day of leaving, or rejoin
before the refund has been paid, or
If you leave the scheme before meeting continue to hold another job in which you
the two-years’ vesting period, you are a member of the scheme and which
can choose a refund of contributions. you held at the same time as the job you
A refund of contributions will include: have left.
• any pension contributions you have
paid, and What will happen to my
benefits if I’ve met the
• any additional pension contributions or two-year vesting period?
AVCs you have paid (other than AVCs
paid for additional life cover); and If you’ve met the two-year vesting
period, the amount held in your active
• any contributions you paid which were pension account up to your date of
included in a transfer payment which leaving is transferred to a deferred
the LGPS received from another pension account and you then have
pension arrangement. what are known as deferred benefits.
A refund of contributions will have a The value of the pension in your
deduction for tax and the cost, if any, of deferred pension account is held in the
buying you back into the S2P in respect LGPS for you until either you decide to
of your membership up to 5 April 2016 transfer the value to another pension
when the LGPS was contracted out of the scheme, or the deferred benefits are
S2P. If a refund is not paid within a year due to be paid.
of you leaving the scheme, then interest
is payable. The rate of interest is 1%
71
Your personal deferred benefits package 2008 and 31 March 2014 is

consists of an annual pension, payable calculated by dividing any period of
throughout your retirement, with an membership you have falling between
option on retirement to exchange some those dates by 60 and multiplying the
pension for a one-off tax-free lump sum. resulting figure by your final pay on
It also includes life cover and financial leaving.
protection for your family.
When you take your deferred benefits,
you will be given the option to
How are deferred benefits exchange some of your annual pension
worked out? for a one-off tax-free lump-sum.
Your deferred benefits will be calculated You receive £12 lump-sum for each £1
as follows: of annual pension given up. You can
take up to 25% of the capital value of
• Your deferred pension in respect of your pension benefits as a lump-sum9.
your membership of the scheme after
31 March 2014 is the value of the • The part of your deferred pension in
pension you have built up in your respect of any membership of the
active pension account at the point scheme you have between before
of leaving. That amount of pension is 1 April 2008 is calculated by dividing
transferred from your active pension any period of membership you have
account to your deferred pension falling before that date by 80 and
account. multiplying the resulting figure by your
final pay on leaving.
When you take your deferred benefits,
you will be given the option to In addition, you will be entitled to an
exchange some of your annual pension automatic tax-free lump-sum of
for a one-off tax-free lump-sum. three times your pension for
You receive £12 lump-sum for each £1 membership before 1 April 2008. You
of annual pension given up. You can can also exchange part of the pre-April
take up to 25% of the capital value of 2008 pension for extra lump-sum as
your pension benefits as a lump-sum8. described above.
• The part of your deferred pension in For more information and examples of
respect of any membership of the how benefits built up before April 2014
scheme you have between 1 April are worked out see the If You Joined
the LGPS Before 1 April 2014 section.
8, 9
Limited to £263,750 (2019/20 figure), or you have previously taken payment of pension (crystallised)
pension benefits, 25% of your remaining lifetime allowance.
72
What if I paid extra? If you pay AVCs arranged through

the LGPS (in-house AVCs)
If you have been paying extra The value of your AVC fund will continue
contributions, your contributions will to be invested until it is paid out. Your
cease when you leave the LGPS. If you AVC plan can be:
leave with deferred benefits you will
benefit from those extra contributions. • transferred to another pension
arrangement, including to a scheme
If you are buying extra LGPS pension that offers flexible benefits, or
by paying APCs and/or ARCs
You will be credited with the extra • taken at the same time as your
pension you have paid for at the time of LGPS benefits.
leaving. This will increase the value of
See the section on ‘Contribution
your deferred benefits and any transfer
flexibility’ for more information about
value paid to a new pension
transferring your AVC to a scheme that
arrangement.
provides flexible benefits.
If you are buying extra years in the
If you elected to pay AVCs on or after
LGPS (added years)
1 April 2014 and you choose to transfer
You will be credited with the extra period
your main LGPS benefits to another LGPS
of membership that you have paid for at
administering authority in England and
the time of leaving. This will increase the
Wales, your AVC must be transferred too.
value of your deferred benefits and any
transfer value paid to a new pension If you are paying additional
arrangement. The extra benefits will be contributions to buy extra cohabiting
calculated on the same basis you had partner’s survivor pension
agreed to buy them. The period of your pre-6 April 1988
membership that you have paid extra for
If you move to a new employer in the
at the time of leaving will be included in
LGPS in England or Wales within 12
the calculation of any survivor’s pension
months of leaving, you can carry on
payable to an eligible cohabiting
paying the additional contributions to buy
partner on your death.
extra years provided you also pay them
to cover the period between leaving and
starting your new job and you join your
pension rights together. You must contact
your new LGPS administrator within
three months of rejoining to arrange this.
73
My LGPS benefits are subject to Early payment of deferred benefits at

a pension sharing order. How your request
You can choose to take early payment of
does this affect my deferred your deferred benefits from age 55. You
benefits? do not need your former employer’s
If your LGPS benefits are subject to a consent to take your pension before your
pension sharing order issued by the normal pension age.
court following divorce or dissolution of If you choose to take your deferred
a civil partnership, or are subject to a benefits before your normal pension
qualifying agreement in Scotland, your age, your benefits will normally be
deferred benefits will be reduced in reduced to take account of their early
accordance with the court order or payment and the fact that your pension
agreement. For more information, see will be paid for longer. How much your
the section on Pensions and Divorce or deferred benefits are reduced by
Dissolution of a Civil Partnership. depends on how early you take them.
When are deferred The reduction is calculated in accordance

with guidance issued by the Secretary of
benefits paid? State from time to time. The reduction is
Your deferred benefits are normally based on the length of time (in years and
payable at your normal pension age in days) that you retire early, ie, the period
the LGPS. Your normal pension age is between the date your benefits are paid
linked to your state pension age (but and your normal pension age.
with a minimum of age 65). They can be
As a guide, the percentage reductions
paid earlier, or later than your normal
(effective from 8 January 2019) for
pension age. There are two ways they retirements up to 13 years early are
can be paid earlier:
shown in the table over the page. Where
• early payment of deferred benefits the number of years is not exact, the
at your request, or reduction percentages are adjusted
accordingly.
• early payment of deferred benefits
due to permanent ill health.
74

0 0.0% 0.0%
1 5.1% 2.3%
2 9.9% 4.6%
3 14.3% 6.9%
4 18.4% 9.1%
5 22.2% 11.2%
6 25.7% 13.3%
7 29.0% 15.3%
8 32.1% 17.3%
9 35.0% 19.2%
10 37.7% 21.1%
11 41.6% N/A
12 44.0% N/A
13 46.3% N/A
Please note that if you built up pension Early payment of deferred benefits
in the LGPS before 1 April 2014 then due to permanent ill health
protections are in place for the normal The second method of obtaining early
pension age that applies to those payment of your deferred benefits is on
benefits. In addition, if you were a the grounds of permanent ill health.
member of the LGPS at any time You can apply for payment of your
between 1 April 1998 and 30 September deferred benefits at any age, without
2006, some or all of your benefits paid reduction if, because of your health, you
early could be protected from the are permanently incapable of doing the
reduction if you are a ‘rule of 85’ job you were working in when you left
protected member. You can find out the LGPS and you are unlikely to be
more about these protections from the capable of undertaking any gainful
section If You Joined the LGPS Before employment within three years of
1 April 2014. applying for the benefit or by your
normal pension age, whichever is
Your former employer can agree to the earlier.
waive any reduction. This is a discretion
and you can ask your employer what
their policy on this is.
75
Payment of deferred benefits at or • forfeit your pension rights if the

after normal pension age Secretary of State for Communities
If you do not take early payment of and Local Government agrees and
deferred benefits under either of the two you have been convicted of a serious
methods outlined above, the deferred offence connected with your
benefits will be paid from your normal employment and because of which
pension age unless you opt to delay you left your employment.
payment beyond that age. If you take
your deferred benefits after your normal You are not allowed to:
pension age your pension will be • assign your benefits. Your LGPS
increased for each day payment of your benefits are strictly personal and
pension is delayed beyond your normal cannot be assigned to anyone else
pension age. Deferred benefits must be or used as security for a loan.
paid before age 75.
If your pension is not in payment at How do deferred benefits
age 60 (women) or 65 (men), the keep their value?
guaranteed minimum pension In the year you leave the LGPS, the
(GMP) element (if any) of your pension value of pension in your pension
must be paid from that age (unless you account (in respect of your membership
are still in some employment at that time from 1 April 2014 onwards ONLY) is
and consent to postponement of revalued up to the date of leaving in
payment of your GMP). line with the revaluation applied to
Keeping in touch active members of the LGPS.
If you change address, please remember This means that if the cost of living
to let your the Fund know so we can has gone down in the year ending
keep in touch with you – something that’s 30 September in the scheme year in
especially important when you come to which you leave, it is possible that the
take your deferred benefits. value of deferred pension in your
Your employer can: pension account could reduce.
• reduce your pension benefits if you For the period after your date of leaving,
cease to be employed as a result of a your total deferred benefits (including the
criminal, negligent or fraudulent act or benefits you built up before 1 April 2014)
omission as a result of which you have will be increased in line with the cost of
incurred some monetary obligation to living. However, if the cost of living goes
the employer. down, your deferred benefits will not be
76
reduced. Your pension will also continue work out whether or not to deduct a
to receive cost of living increases every recovery tax charge.
year once it is paid to you.
On your benefits being paid on or after
What will happen if I die before
age 55, or if your benefits are paid before receiving my deferred benefits?
age 55 because of ill health and you are If you leave with deferred benefits after
permanently incapacitated from engaging 31 March 2014 and die before receiving
in any regular full-time employment, your them, the following benefits are payable:
benefits will be increased each year in
line with the cost of living. Otherwise, if A lump-sum death grant of five times
you take your benefits before age 55, your deferred annual pension. Your
you will normally have to wait until your administering authority, the City of
55th birthday for your first cost of living Wolverhampton Council, has absolute
increase, when your pension will be discretion when deciding who to pay
increased to the level it would have been any death grant to. The LGPS allows
had it been increased each year. you to express your wish as to who you
would like any death grant to be paid
Do the tax rules on savings to by completing and returning an
‘expression of wish’ form. You can
cover deferred benefits? complete an ‘expression of wish’ form at
There are HM Revenue and Customs any time. The form is available from the
controls on all your pension savings – not Fund.
including any state retirement pension,
If any part of the death grant has not
state pension credit or any spouse’s,
been paid within two years, it must be
civil partner’s, eligible cohabiting
paid to your personal representatives,
partner's or dependant’s pension you
ie, to your estate. Your personal
may be entitled to.
representatives will need to inform HM
You can find out about HM Revenue Revenue and Customs if, together with
and Customs controls on your pension the lump-sum death grant, the value of all
savings from the section on Tax Controls your pension benefits - but not including
and Your LGPS Benefits. any spouse’s, civil partner’s, eligible
cohabiting partner's or dependant’s
The Fund will let you know the value of pension you may be entitled to – exceeds
your LGPS benefits when they are paid the HM Revenue and Customs lifetime
and ask you about any other pensions allowance. Under HM Revenue and
you may have in payment, so we can
77
Customs rules, any excess will be subject 2014 and die before receiving them, the
to a recovery tax charge. Most scheme following benefits are payable:
members’ pension savings will be
significantly less than the allowance. • A lump-sum death grant of five times
You can find more information on this the deferred benefits awarded after
from the section on Tax Controls and 31 March 2014, plus five times the
Your LGPS Benefits. deferred annual pension for deferred
benefits awarded between 1 April
If you left with deferred benefits before 2008 and 31 March 2014, plus three
1 April 2014 and die before receiving times the deferred annual pension for
them and you are also an active member deferred benefits awarded before
when you die the greater of the 1 April 2008.
following will be paid:
If you paid AVCs arranged through the
• A lump-sum death grant of five times LGPS (in-house AVCs), the value of your
(or, if you left before 1 April 2008, three AVC fund is also payable.
times) your deferred annual pension;
or A survivor's pension. A pension will be
paid to your spouse, registered civil
• A death-in-service lump-sum of partner or, subject to certain qualifying
three times your assumed conditions, your eligible cohabiting
pensionable pay. partner. This pension is payable
immediately after your death for the
If you leave with deferred benefits after rest of their life and will increase every
31 March 2014 and die before receiving year in line with the cost of living.
them and you are also an active member
when you die, the greater of the following • For your spouse (from an opposite
benefits are payable: sex or same sex marriage):
For each year of membership you built
• A lump-sum death grant of five times up from 1 April 2014, you were
your deferred annual pension, or credited with a pension equal to a
• A death-in-service lump-sum of proportion (ie 1/49th or, for any period
three times your assumed you were in the 50/50 section of the
pensionable pay. scheme, 1/98th) of the pensionable
pay (or assumed pensionable pay
If you leave with deferred benefits after where applicable) you received during
31 March 2014 and also have deferred that year. The pension payable to your
benefits from an earlier period of spouse is calculated on a different
membership which ended before 1 April proportion ie, 1/160th of the
78
pensionable pay (or assumed credited with a pension equal to a

pensionable pay where applicable) to proportion (ie, 1/49th or, for any period
which is added 49/160ths of the you were in the 50/50 section of the
amount of any pension credited to your scheme, 1/98th) of the pensionable
pension account following a transfer pay (or assumed pensionable pay
of pension rights into the scheme from where applicable) you received during
another pension scheme or that year. The pension payable to your
arrangement. civil partner is calculated on a
different proportion, ie, 1/160th of the
For final salary membership built up pensionable pay (or assumed
before 1 April 2014, the pension pensionable pay where applicable)
payable is equal to 1/160th of your to which is added 49/160ths of the
final pay times the period of your amount of any pension credited to your
membership in the scheme up to 31 pension account following a transfer
March 2014 on which your deferred of pension rights into the scheme from
pension is based, unless you marry another pension scheme or
after leaving in which case it could be arrangement.
less. If you marry while your pension
is deferred: For final salary membership built up
before 1 April 2014, the pension
- the survivor’s pension payable to payable is equal to 1/160th of your
the husband of a female scheme final pay times the period of your
member is based on membership membership in the scheme up to
after 5 April 1988 31 March 2014 (including any
- the survivor’s pension payable to the additional membership purchased
wife of a male scheme member is by you) upon which your deferred
based on membership after 5 April pension is based unless you enter into
1978 a civil partnership after leaving in
which case your civil partner’s
- the survivor’s pension payable to the pension would be based on your
male or female spouse who was in a membership after 5 April 1978 (or on
same sex marriage with the scheme all of your membership if you became
member is based on membership a deferred member before 1 April 2014
after 5 April 1988. and had made an election before
1 April 2015 for pre-6 April 1978
• For your civil partner: membership to also count).
For each year of membership you
built up from 1 April 2014, you were
79
• For your eligible cohabiting If your deferred pension is subject to a

partner: pension sharing order issued by the
For each year of membership you built court following an earlier divorce or
up from 1 April 2014, you were credited dissolution of a civil partnership, or is
with a pension equal to a proportion subject to a qualifying agreement in
(ie, 1/49th or, for any period you were Scotland, your spouse’s, civil partner’s
in the 50/50 section of the scheme, or eligible cohabiting partner’s
1/98th) of the pensionable pay (or pension will be reduced in consequence
assumed pensionable pay where of that court order or agreement.
applicable) you received during that For more information, see the section on
year. The pension payable to your Pensions and Divorce or Dissolution
eligible cohabiting partner is of a Civil Partnership.
calculated on a different proportion
ie, 1/160th of the pensionable pay If your membership in the LGPS includes
(or assumed pensionable pay a GMP, the survivor pension for that part
where applicable) to which is added of your membership before 6 April 1997
49/160ths of the amount of any must not be less than half your GMP built
pension credited to your pension up after 5 April 1988. If you are a man
account following a transfer of who is survived by a wife, the survivor
pension rights into the scheme from pension for that part of your membership
another pension scheme or built up before 6 April 1997 must not be
arrangement. less than half of your total GMP.
For final salary membership built up Children's pensions - these are payable
before 1 April 2014, the pension to eligible children and increase every
payable is equal to 1/160th of your year in line with the cost of living.
final pay times the period of your The amount of pension depends on the
membership in the scheme after number of eligible children you have:
5 April 1988 and up to 31 March 2014
(including any additional membership • If a survivor's pension is being paid
purchased by you), upon which your to your spouse (from an opposite
deferred pension is based, plus any of sex or same sex marriage), civil
your membership before 6 April 1988 partner or eligible cohabiting
for which, under an election made partner,
before 1 April 2014, you have paid
additional contributions so that it counts One child would receive a pension
towards an eligible cohabiting calculated as follows:
partner's pension.
80
For each year of membership you built that year. The children’s pension
up from 1 April 2014, you were credited payable is calculated on a different
with a pension equal to a proportion proportion, ie, 1/160th of the
(ie, 1/49th or, for any period you were pensionable pay (or assumed
in the 50/50 section of the scheme, pensionable pay where applicable) to
1/98th) of the pensionable pay (or which is added 49/160ths of the
assumed pensionable pay where amount of any pension credited to your
applicable) you received during that pension account following a transfer
year. The child’s pension payable is of pension rights into the scheme
calculated on a different proportion, from another pension scheme or
ie, 1/320th of the pensionable pay (or arrangement. The pension would be
assumed pensionable pay where shared equally between the eligible
applicable) to which is added 49/320ths children.
of the amount of any pension credited
to your pension account following a For final salary membership built up
transfer of pension rights into the before 1 April 2014, the pension
scheme from another pension scheme payable is equal to 1/160th of your
or arrangement. final pay times the period of your
membership in the scheme up to
For final salary membership built up 31 March 2014 on which your
before 1 April 2014, the pension deferred pension is based. The pension
payable is equal to 1/320th of your would be shared equally between the
final pay times the period of your eligible children.
membership in the scheme to
31 March 2014 upon which your • If there is no spouse's, civil
deferred pension is based. partner’s or eligible cohabiting
partner's pension being paid,
Two or more children would receive
a pension calculated as follows: One child would receive a pension
calculated as follows:
up from 1 April 2014, you were For each year of membership you built
credited with a pension equal to a up from 1 April 2014, you were
proportion (ie, 1/49th or, for any period credited with a pension equal to a
you were in the 50/50 section of the proportion (ie, 1/49th or, for any period
scheme, 1/98th) of the pensionable you were in the 50/50 section of the
pay (or assumed pensionable pay scheme, 1/98th) of the pensionable
where applicable) you received during pay (or assumed pensionable pay
where applicable) you received during
81
that year. The child’s pension payable from another pension scheme or
is calculated on a different proportion, arrangement. The pension would be
ie, 1/240th of the pensionable pay (or shared equally between the eligible
assumed pensionable pay where children.
applicable) to which is added 49/240ths
of the amount of any pension credited For final salary membership built up
to your pension account following a before 1 April 2014, the pension
transfer of pension rights into the payable is equal to 1/120th of your
scheme from another pension scheme final pay times the period of your
or arrangement. membership in the scheme to
31 March 2014 on which your
For final salary membership built up deferred pension is based. The pension
before 1 April 2014, the pension would be shared equally between
payable is equal to 1/240th of your the eligible children.
final pay times the period of your
membership in the scheme to If you were a member of the LGPS
31 March 2014 on which your before 1 April 2014 and you paid
deferred pension is based. ARCs to buy extra LGPS pension and
you opted to pay for dependant's benefits
Two or more children would receive when you took out your original contract,
a pension calculated as follows: then extra benefits will be payable to your
For each year of membership you built spouse, registered civil partner or
up from 1 April 2014, you were eligible cohabiting partner and to
credited with a pension equal to a eligible children.
proportion (ie, 1/49th or, for any period
you were in the 50/50 section of the
Who is the lump-sum death
scheme, 1/98th) of the pensionable grant paid to?
pay (or assumed pensionable pay Your administering authority, the City of
where applicable) you received during Wolverhampton Council, has absolute
that year. The children’s pension discretion over who receives any lump-
payable is calculated on a different sum death grant; they can pay it to your
proportion, ie, 1/120th of the nominee or personal representatives or
pensionable pay (or assumed to any person who appears, at any time,
pensionable pay where applicable) to have been your relative or dependant.
to which is added 49/120ths of the The LGPS, however, allows you to
amount of any pension credited to your express your wish as to who you would
pension account following a transfer like any death grant to be paid to by
of pension rights into the scheme completing and returning an ‘expression
82
of wish’ form. If any part of the death You can only transfer benefits from the
grant has not been paid within two LGPS if you have not already taken
years, it must be paid to your personal benefits from the LGPS (either in your
representatives, ie, to your estate. If you current employment or any earlier
have not already made your wishes employment). If you hold more than one
known, or you wish to update/change a deferred benefit in the LGPS in England
previous expression of wish, a form is and Wales (either in the same or separate
available from the Fund. Remember to LGPS pension funds), you will be required
complete a new form if your wishes to transfer all or none of the benefits you
change. hold. It is not possible to transfer one
deferred benefit whilst retaining another
If you have paid AVCs and a lump-sum is
deferred benefit in the LGPS.
to be paid from the your AVC fund, your
administering authority has absolute Your new pension provider will require a
discretion over who to pay that sum to, transfer value quotation which, under the
provided you were an active member of provisions introduced by the Pensions Act
the LGPS on or after 1 April 2014. If you 1995, the Fund will (other than in respect
left the LGPS before 1 April 2014, your of AVCs) guarantee for a period of three
administering authority must pay any months from the date of calculation
AVC lump-sum to your estate. (known as the ‘guarantee date’). Your
new pension provider can then advise
What will happen if I wish to you of the additional benefits the transfer
transfer my LGPS benefits to will buy in their scheme. A written option
another (non-LGPS) scheme? to proceed with the guaranteed transfer
value must be received within the three
If you are joining another pension month guaranteed period. If you opt to
arrangement, you may consider proceed, the normal time limit for
transferring your LGPS benefits to it. payment of the guaranteed transfer value
This may even be to an overseas will be six months from the ‘guarantee
pension scheme or arrangement that date’. If payment is not made within this
meets HM Revenue and Customs period, the Fund will need to recalculate
conditions. You cannot transfer your the value as at the actual date of payment
benefits (other than AVCs) if you leave and pay the recalculated value or, if it is
less than one year before your normal greater, the original value plus interest.
pension age. An option to transfer
(other than in respect of AVCs) must be Transfer values are calculated in
made at least 12 months before your accordance with the terms and
normal pension age. conditions of the Local Government
Pension Scheme Regulations 2013
83
which comply with the requirements If you are transferring from the LGPS
of the Pensions Schemes Act 1993. to a defined contribution scheme
you must take appropriate independent
If you are considering whether to financial advice before transferring.
transfer benefits, make sure you have This is a legal requirement if the cash
full information about the two pension equivalent transfer value of all your
arrangements, ie, details of what your benefits in the LGPS (excluding any
benefits are worth in the LGPS and additional voluntary contributions
details of what your benefits would be (AVCs)) is more than £30,000. If the
worth in the new pension scheme, if cash equivalent transfer value of all your
transferred. When you compare your benefits in the LGPS (excluding any
options, don’t forget that your LGPS AVCs) is £30,000 or less you are not
benefits are guaranteed cost of living legally required to take advice. However,
increases. Transfers to public sector transferring your pension rights is not
schemes usually give benefits that are always an easy decision to make and
broadly equivalent to those in the LGPS, seeking the help of an independent
under what are known as Club transfer financial adviser before you make a
rules, provided you apply for the transfer decision to transfer your deferred
within 12 months of joining your new benefits (to a personal pension plan,
pension scheme and have not had a stakeholder pension scheme or an
break in membership of more than five employer’s money purchase scheme)
years between leaving the LGPS and could help you in making an appropriate
joining the new public service pension decision that could significantly affect
scheme. your future pension benefits.
Transferring your pension rights is not
If the cash equivalent transfer value of
always an easy decision to make and
all your benefits in the LGPS (excluding
you may wish to seek the help of an
any AVCs) is more than £30,000, the
independent financial adviser before you
Fund will check that you have received
make a decision to transfer your deferred
appropriate independent financial advice
benefits to a personal pension plan,
before your transfer can proceed and
stakeholder pension scheme or to an
relevant documentation to prove this will
employer’s money purchase scheme, as
be required. The Fund will provide you
you will be bearing all of the investment
with more details if you request a transfer
risk which could significantly affect your
quotation.
future pension benefits.
84
If you are considering whether to If you wish to transfer your LGPS pension
transfer benefits, make sure you have rights, you should contact your current or
full information about the two pension former LGPS administrator as soon as
arrangements: details of what your possible to commence the process and
benefits are worth in the LGPS and details find out what you will need to consider in
of what your benefits would be worth in making your decision.
the new pension scheme, if transferred.
When you compare your options, don’t Please note that special rules apply if you
forget that your LGPS benefits are were a member of the LGPS in England
guaranteed cost of living increases. or Wales on or before 31 March 2014 –
see the section Transferring Pension
If a full transfer payment is made, you Rights into the LGPS for more
will not be entitled to any further benefits information.
from the LGPS for yourself, your spouse,
civil partner, eligible cohabiting Please also note that if you became
partner or eligible children. entitled to your deferred benefit as a
result of making an election to opt out of
membership of the scheme, you will not
What happens if I change jobs be permitted to join your two periods of
but remain in the LGPS? membership together and, instead, you
If you are changing your job, but still will have two separate sets of pension
working in local government or for benefits in the scheme.
another employer who offers you
membership of the LGPS, or if you rejoin What if I have two or more
the LGPS before your deferred benefits LGPS jobs?
are paid, your deferred benefits are
normally automatically joined with your If you have two or more jobs in which
new active pension account when you you pay into the LGPS at the same time
rejoin the scheme, unless you elect to and you leave one (or more) but not all of
keep them separate. them, and you are entitled to deferred
benefits from the job (or jobs) you have
If you wish to keep your deferred benefits left, your deferred benefits from the job
separate you must elect to do so within that has ended are automatically
12 months of rejoining the LGPS, unless transferred to the active pension
your employer allows you longer. This is account for the job you are continuing in,
an employer discretion and you can ask unless you elect to keep them separate.
your employer what their policy is on this.
85
If you wish to keep your deferred benefits What happens if my job is

separate you must elect to do so within transferred to a private
12 months of leaving the post the
deferred benefits were built up in, unless
contractor?
your employer allows you longer. This is If your job is transferred to a private
an employer discretion and you can ask contractor, the contractor will normally
your employer what their policy is on this. be required to provide you with continued
If you are not entitled to deferred access to the LGPS or to offer you a
benefits from the job (or jobs) you have pension scheme that is broadly
left, you cannot have a refund of your equivalent to the LGPS. The contractor
contributions and you must transfer may become an admission body in the
your benefits to the pension account LGPS and this would allow you to stay
for the job you are continuing in. in the LGPS so long as you continue
working on the delivery of the
Please note that special rules apply if you
contracted-out service.
were a member of the LGPS in England
or Wales on or before 31 March 2014 – If the contractor becomes an admission
see the section Transferring Pension body, your LGPS benefits built up before
Rights into the LGPS for more the transfer of your job to the contractor
information. can be joined with your post transfer
pension account, see the section
If you have membership built up before
Transferring Pension Rights into
1 April 2014 which you aggregate with
the LGPS.
the membership in the job you are
continuing in, then this membership is Alternatively, the contractor may be
adjusted to reflect any difference in the able to offer you a broadly comparable
whole-time rates of pay between the scheme. This does not mean that the
jobs: new scheme must mirror the benefits of
whole-time rate of the LGPS, but the value of the package
pay in the job that offered by the new scheme must be
Membership has ceased broadly equivalent to the LGPS. If you
in the job x are offered a broadly comparable
you have left whole-time rate of scheme you would have the same
pay in the job that is options available to you regarding the
continuing LGPS benefits that you have already
built up as anyone else leaving the
LGPS before retirement.
86
More information
booklet.
Problems.
87
Life Cover - Protection For Your Family
The LGPS provides valuable life cover and financial protection

for your family.
In this section, we look at how these benefits work if you pay
into the LGPS on or after 1 April 2014.
Where pension terms are used, they reduced contractual hours because of the
appear in bold italic type. These terms ill health which led to death in service, the
are defined in the Some Terms We Use assumed pensionable pay is calculated
section. on the pay you would have received
during that period had you not been
What lump-sum benefits will working reduced contractual hours.
be paid if I die in service? If you pay AVCs arranged through the
If you die in service as a member of the LGPS (in-house AVCs), the value of your
LGPS, a lump-sum death grant of three AVC fund is also payable, as is any extra
times your assumed pensionable pay life cover.
at your date of death is paid, no matter
how long you have been a member of What survivor benefits will
the LGPS, provided you are under age be paid if I die in service?
75 at the date of death.
An ongoing pension is provided for your
If you have a deferred benefit and/or a spouse, civil partner or, subject to
pension in payment from a previous certain qualifying conditions, your
period of membership of the scheme the eligible cohabiting partner and to
lump sum death grant will be any lump your eligible children as shown below.
sum death grants payable in respect of
those deferred benefits and pensions in A survivor's pension
payment or the death in service lump An ongoing pension is provided for your
sum death grant of three times your spouse, registered civil partner or,
assumed pensionable pay, whichever subject to certain qualifying conditions,
is the greater. your eligible cohabiting partner.
This pension is payable immediately after
Where an independent registered your death for the rest of their life and
medical practitioner certifies that, during will increase every year in line with the
the period used to determine assumed cost of living.
pensionable pay, you were working
88
• For your spouse (from an opposite • For your eligible cohabiting

sex or same sex marriage) or civil partner:
partner: For each year of membership you built
For each year of membership you built up from 1 April 2014 to your date of
up from 1 April 2014 to your date of death you would have been credited
death, you would have been credited with a pension equal to a proportion
with a pension equal to a proportion (ie 1/49th or, for any period you were
(ie, 1/49th or, for any period you were in the 50/50 section of the scheme,
in the 50/50 section of the scheme, 1/98th) of the pensionable pay (or
1/98th) of the pensionable pay (or assumed pensionable pay where
assumed pensionable pay where applicable) you received during that
applicable) you received during that year. The pension payable to your
year. The pension payable to your eligible cohabiting partner is
spouse or civil partner is calculated calculated on a different proportion
on a different proportion, ie, 1/160th of ie, 1/160th of your pensionable pay
your pensionable pay (or assumed (or assumed pensionable pay where
pensionable pay where applicable) to applicable) to which is added 49/160ths
which is added 49/160ths of the of the amount of any pension credited
amount of any pension credited to your to your pension account following a
pension account following a transfer transfer of pension rights into the
of pension rights into the scheme scheme from another pension scheme
from another pension scheme or or arrangement, plus an amount
arrangement, plus an amount equal equal to 1/160th of your assumed
to 1/160th of your assumed pensionable pay each year of
pensionable pay for each year of membership you would have built up
membership you would have built up from your date of death to your
from your date of death to your normal pension age.
normal pension age.
For final salary membership built up
For final salary membership built up before 1 April 2014 the pension
before 1 April 2014 the pension payable is equal to 1/160th of your
payable is equal to 1/160th of your final pay times the period of your
final pay times the period of your membership in the scheme after 5 April
membership in the scheme up to 1988 up to 31 March 2014, plus any of
31 March 2014. your membership before 6 April 1988
for which, under an election made
before 1 April 2014, you have paid
89
additional contributions so that it counts • Children's pensions - these are

towards an eligible cohabiting payable to eligible children and
partner's pension. increase every year in line with the
cost of living.
For a cohabiting partner to be entitled
to receive a survivor’s pension your The amount of pension depends on the
relationship has to meet certain number of eligible children you have:
conditions laid down by the LGPS.
• If a survivor's pension is being paid
You can find information on these
to your spouse, civil partner or
conditions later in this section.
eligible cohabiting partner
If an independent registered medical
One child would receive a pension
practitioner certifies that, during the
calculated as follows:
period used to determine assumed
pensionable pay, you were working For each year of membership you built
reduced contractual hours because of up from 1 April 2014 to your date of
the ill health which led to death in death you would have been credited
service, the assumed pensionable with a pension equal to a proportion
pay is calculated on the pay you would (ie, 1/49th or, for any period you were
have received during that period had in the 50/50 section of the scheme,
you not been working reduced 1/98th) of the pensionable pay (or
contractual hours. assumed pensionable pay where
applicable) you received during that
If your pension is subject to a pension
year. The child’s pension payable is
sharing order issued by the court
calculated on a different proportion,
following an earlier divorce or
ie, 1/320th of your pensionable pay
dissolution of a civil partnership, or
(or assumed pensionable pay where
is subject to a qualifying agreement
applicable) to which is added 49/320ths
in Scotland, your spouse’s, civil
partner’s or eligible cohabiting
to your pension account following a
partner’s pension will be reduced in
transfer of pension rights into the
consequence of that court order or
scheme from another pension scheme
agreement. For more information, see
or arrangement, plus an amount
the section on Pensions and Divorce
equal to 1/320th of your assumed
or Dissolution of a Civil Partnership.
pensionable pay for each year of
membership you would have built up
from your date of death to your
normal pension age.
90
For final salary membership built up For final salary membership built up
before 1 April 2014 the pension before 1 April 2014 the pension
payable is equal to 1/320th of your payable is equal to 1/160th of your
final pay times the period of your final pay times the period of your
membership in the scheme up to membership in the scheme up to
31 March 2014. 31 March 2014. The pension would
be shared equally between the
Two or more children would receive eligible children.
a pension calculated as follows:
• If there is no spouse's, civil
For each year of membership you built partner’s or eligible cohabiting
up from 1 April 2014 to your date of partner's pension being paid,
death you would have been credited
with a pension equal to a proportion One child would receive a pension
(ie, 1/49th or, for any period you were calculated as follows:
in the 50/50 section of the Scheme,
1/98th) of the pensionable pay (or For each year of membership you built
assumed pensionable pay where up from 1 April 2014 to your date of
applicable) you received during that death you would have been credited
year. The children’s pension payable is with a pension equal to a proportion
calculated on a different proportion, (ie, 1/49th or, for any period you were
ie, 1/160th of your pensionable pay in the 50/50 section of the scheme,
(or assumed pensionable pay 1/98th) of the pensionable pay (or
where applicable) to which is added assumed pensionable pay where
49/160ths of the amount of any applicable) you received during that
pension credited to your pension year. The child’s pension payable is
account following a transfer of calculated on a different proportion,
pension rights into the scheme ie, 1/240th of your pensionable pay
from another pension scheme or (or assumed pensionable pay where
arrangement, plus an amount equal applicable) to which is added 49/240ths
to 1/160th of your assumed of the amount of any pension credited
pensionable pay for each year of to your pension account following a
membership you would have built up transfer of pension rights into the
from your date of death to your scheme from another pension scheme
normal pension age. The pension or arrangement, plus an amount
would be shared equally between the equal to 1/240th of your assumed
eligible children. pensionable pay for each year of
membership you would have built up
from your date of death to your
normal pension age.
91
31 March 2014. 31 March 2014. The pension would
If an independent registered medical
practitioner certifies that, during the
up from 1 April 2014 to your date of
period used to determine assumed
death you would have been credited
pensionable pay, you were working
with a pension equal to a proportion
reduced contractual hours because of
(ie, 1/49th or, for any period you were
the ill health which led to death in
in the 50/50 section of the scheme,
service, the assumed pensionable
1/98th) of the pensionable pay (or
pay is calculated on the pay you would
assumed pensionable pay where
have received during that period had
applicable) you received during that
you not been working reduced
year. The children’s pension payable is
contractual hours.
calculated on a different proportion,
ie, 1/120th of your pensionable pay If you are in the 50/50 section of the
(or assumed pensionable pay where scheme when you die this does not
applicable) to which is added 49/120ths impact on the value of any pension
of the amount of any pension credited for your spouse, civil partner,
to your pension account following a eligible cohabiting partner or
transfer of pension rights into the eligible children.
or arrangement, plus an amount If you die in service and:
equal to 1/120th of your assumed • you are paying, or have paid,
pensionable pay for each year of additional contributions to buy
membership you would have built up extra LGPS pension by paying
from your date of death to your APCs or SCAPCs these will not count
normal pension age. The pension towards the value of any survivor’s
would be shared equally between the pension or children's pensions as they
eligible children. only count towards your pension.
92
• you elected before 1 April 2014 to • you had paid AVCs arranged through
pay ARCs then, provided you opted to the LGPS (in-house AVCs) the value of
pay for dependants’ benefits when you your AVC fund is payable as is the
took out your original contract, extra value of any extra life cover pension
benefits will be payable to your spouse, for your spouse, civil partner or
civil partner or eligible cohabiting eligible cohabiting partner and
partner and to eligible children. eligible children paid for through
If you were still paying the ARCs at the AVCs.
date of death you will be deemed to
have completed all payments. If you What benefits will be paid if I
did not opt to pay for dependants’ die after retiring on pension?
benefits when you took out your
original ARC contract, then no extra If you die after retiring on pension, your
benefits will be payable. benefits will no longer be payable.
Your spouse, civil partner, eligible
• you elected before 1 April 2008 to cohabiting partner, next-of-kin or
buy LGPS added years of person dealing with your estate must
membership you will be credited on immediately inform the Fund of your date
your death with the whole extra period of death as otherwise an overpayment
of membership that you set out to buy, could occur. Contact details can be found
even if you have not completed full at the front of this booklet.
payment for it. This will increase the
value of the benefits payable to your The following benefits may then be
spouse, civil partner or eligible payable on your death:
cohabiting partner and to eligible A lump sum death grant
children. A lump sum death grant will be paid if,
• you elected before 1 April 2014 to when you die, less than ten years pension
buy extra cohabiting partner has been paid and you are under age 75
survivor benefits, then the whole of at your date of death. The amount
your pre-6 April 1988 membership payable would be:
that you were paying additional • ten times the level of your annual
contributions for will be included in pension in respect of your membership
calculating any survivor pension of the scheme after 31 March 2014
payable to an eligible cohabiting (before giving up any pension for a
partner, even if you have not tax-free cash lump sum), less any
completed full payment for it. pension already paid to you in respect
93
of your post-31 March 2014 • For your spouse (from an opposite

membership and the amount of any sex or same sex marriage):
tax-free cash lump sum you chose to For each year of membership you built
take by giving up some of the pension up from 1 April 2014 you were credited
you built up after 31 March 2014 when with a pension equal to a proportion
you took your pension at retirement, (ie, 1/49th or, for any period you were
plus in the 50/50 section of the scheme
• ten the level of your annual pension in assumed pensionable pay where
respect of your membership of the applicable) you received during that
scheme before 1 April 2014 (after year (plus 1/49th of assumed
giving up any pension for a tax-free pensionable pay for any
cash lump sum), less any pension enhancement given if retirement
already paid to you in respect of your had been on ill-health grounds).
pre-1 April 2014 membership. The pension payable to your spouse
However, if you are receiving a pension is calculated on a different proportion,
and are also an active member of the ie, 1/160th of the pensionable pay
pension scheme and die in service, a (or assumed pensionable pay where
death in service lump sum death grant of: applicable) to which is added 49/160ths
• the amount as calculated above, or, if to your pension account following a
higher transfer of pension rights into the
• three times your assumed
or arrangement.
pensionable pay will be payable.
A survivor's pension
before 1 April 2014 the pension
A pension will be paid to your spouse,
payable is equal to 1/160th of your
registered civil partner or, subject to
certain qualifying conditions, your final pay times the period of your
membership in the scheme up to
eligible cohabiting partner. This
31 March 2014 upon which your
pension is payable immediately after
pension is based, unless you marry
your death for the rest of their life and
after retiring in which case it could be
will increase every year in line with the
less.
cost of living.
94
If you marry after retiring: For final salary membership built up

before 1 April 2014 the pension
- a female member’s surviving payable is equal to 1/160th of your
husband’s pension is based on final pay times the period of your
membership after 5 April 1988 membership in the scheme up to
- a male member’s surviving wife’s 31 March 2014 (including any
pension is based on membership additional membership purchased
after 5 April 1978 by you) upon which your pension is
based unless you enter into a civil
- the survivor’s pension of a same partnership after leaving in which
sex marriage is based on case your civil partner’s pension
membership after 5 April 1978. would be based on your membership
after 5 April 1978 (or on all of your
• For your civil partner: membership if you became a
For each year of membership you built pensioner before 1 April 2014 and
up from 1 April 2014 you were credited makes an election before 1 April 2015
with a pension equal to a proportion for pre-6 April 1978 membership to
(ie, 1/49th or, for any period you were also count).
• For your eligible cohabiting
partner:
applicable) you received during that For each year of membership you built
year (plus 1/49th of assumed up from 1 April 2014 you were credited
pensionable pay for any with a pension equal to a proportion
enhancement given if retirement had (ie, 1/49th or, for any period you were
been on ill-health grounds). in the 50/50 section of the scheme,
The pension payable to your civil 1/98th) of the pensionable pay (or
partner is calculated on a different assumed pensionable pay where
proportion, ie, 1/160th of the applicable) you received during that
pensionable pay (or assumed year (plus 1/49th of assumed
pensionable pay where applicable) pensionable pay for any
to which is added 49/160ths of the enhancement given if retirement
amount of any pension credited to your had been on ill-health grounds).
pension account following a transfer The pension payable to your eligible
of pension rights into the scheme cohabiting partner is calculated on
from another pension scheme or a different proportion ie 1/160th of
arrangement. the pensionable pay (or assumed
pensionable pay where applicable) to
95
which is added 49/160ths of the Children's pensions - these are payable

amount of any pension credited to to eligible children and increase every
your pension account following a year in line with the cost of living.
The amount of pension depends on the
scheme from another pension
number of eligible children you have:
scheme or arrangement.
• If a survivor's pension is being paid
to your spouse, civil partner or
before 1 April 2014, the pension
payable is equal to 1/160th of your eligible cohabiting partner,
final pay times the period of your One child would receive a pension
membership in the scheme after calculated as follows:
5 April 1988 and up to 31 March 2014
(including any additional membership For each year of membership you built
purchased by you), upon which your up from 1 April 2014 you were credited
pension is based, plus any of your with a pension equal to a proportion
membership before 6 April 1988 for (ie, 1/49th or, for any period you were
which, under an election made prior to in the 50/50 section of the scheme,
1 April 2014, you have paid additional 1/98th) of the pensionable pay (or
contributions so that it counts towards assumed pensionable pay where
an eligible cohabiting partner's applicable) you received during that
pension. year (plus 1/49th of assumed
pensionable pay for any
If your pension is subject to a pension enhancement given if retirement had
sharing order issued by the court been on ill-health grounds). The child’s
following an earlier divorce or pension payable is calculated on a
dissolution of a civil partnership, or different proportion, ie, 1/320th of the
is subject to a qualifying agreement pensionable pay (or assumed
in Scotland, your spouse’s, civil pensionable pay where applicable)
partner’s or eligible cohabiting to which is added 49/320ths of the
partner’s pension will be reduced in amount of any pension credited to
consequence of that court order or your pension account following a
agreement. For more information, see transfer of pension rights into the
the section on Pensions and Divorce scheme from another pension scheme
or Dissolution of a Civil Partnership. or arrangement.
96
membership in the Scheme up to membership in the scheme up to
31 March 2014 upon which your 31 March 2014 upon which your
pension is based. pension is based. The pension would
• If there is no spouse's, civil
For each year of membership you built partner’s or eligible cohabiting
up from 1 April 2014 you were credited partner's pension being paid,
with a pension equal to a proportion
(ie, 1/49th or, for any period you were One child would receive a pension
in the 50/50 section of the scheme, calculated as follows:
assumed pensionable pay where For each year of membership you
applicable) you received during that built up from 1 April 2014 you were
year (plus 1/49th of assumed credited with a pension equal to a
pensionable pay for any proportion (ie, 1/49th or, for any
enhancement given if retirement period you were in the 50/50 section
had been on ill-health grounds). of the scheme, 1/98th) of the
The children’s pension payable is pensionable pay (or assumed
calculated on a different proportion, pensionable pay where applicable)
ie, 1/160th of the pensionable pay you received during that year (plus
(or assumed pensionable pay 1/49th of assumed pensionable
where applicable) to which is added pay for any enhancement given if
49/160ths of the amount of any retirement had been on ill-health
pension credited to your pension grounds). The child’s pension payable
account following a transfer of is calculated on a different proportion,
pension rights into the scheme from ie, 1/240th of the pensionable pay (or
another pension scheme or assumed pensionable pay where
arrangement. The pension would applicable) to which is added 49/240ths
be shared equally between the of the amount of any pension credited
eligible children. to your pension account following a
or arrangement.
97
31 March 2014 upon which your 31 March 2014 upon which your
pension is based. pension is based. The pension would
If you paid additional contributions to
For each year of membership you built buy extra benefits, see the section on
up from 1 April 2014 you were credited Contribution Flexibility to find
with a pension equal to a proportion information on any extra survivor
(ie, 1/49th or, for any period you were benefits that may be payable.
Who is the lump sum death
applicable) you received during that grant paid to?
year (plus 1/49th of assumed Your administering authority has absolute
pensionable pay for any discretion over who receives any lump
enhancement given if retirement sum death grant; they can pay it to your
had been on ill-health grounds). nominee or personal representatives or
The children’s pension payable is to any person who appears, at any time,
calculated on a different proportion, to have been your relative or dependant.
ie, 1/120th of the pensionable pay The LGPS, however, allows you to
(or assumed pensionable pay express your wish as to who you would
where applicable) to which is added like any death grant to be paid to by
49/120ths of the amount of any completing and returning an expression
pension credited to your pension of wish form.
account following a transfer of
pension rights into the scheme If any part of the death grant has not
from another pension scheme or been paid within two years, it must be
arrangement. The pension would be paid to your personal representatives,
shared equally between the eligible ie, to your estate. If you have not already
children. made your wishes known, or you wish to
update / change a previous expression of
wish, a form is available from the Fund.
98
Remember to complete a new form if cohabiting partner, any spouse's

your wishes change. pension, civil partner’s pension or
eligible cohabiting partner’s
If you have paid AVCs and a lump sum is pension payable following your death
to be paid from the your AVC fund, your will also be reduced. Benefits payable
administering authority has absolute to eligible children will not, however,
discretion over who to pay that sum to, be reduced because of a pension
provided you were an active member of sharing order or a qualifying
the LGPS on or after 1 April 2014. If you agreement in Scotland.
left the LGPS before 1 April 2014, your
administering authority must pay any • If your membership in the LGPS
AVC lump sum to your estate. includes a GMP, the survivor pension
for that part of your membership
What conditions need to be before 6 April 1997 must not be less
met for an eligible cohabiting than half your GMP built up after
partner’s survivor’s pension to 5 April 1988. If you are a man who
is survived by a wife, the survivor
be payable? pension for that part of your
If you have a cohabiting partner, of either membership built up before 6 April
opposite or same sex, they will be entitled 1997 must not be less than half of
to receive a survivor's pension on your your total GMP.
death if they meet the criteria required to
• Your personal representatives will need
be an eligible cohabiting partner. See
to inform HM Revenue and Customs if,
the Some Terms We Use section at the
with the lump sum death grant, the
end of the guide for more details.
value of all your pension benefits –
And… but not including any spouse’s,
civil partner’s, eligible cohabiting
• If your LGPS benefits are subject to a partner’s or dependant’s pensions
pension sharing order issued by the you may have been entitled to –
court following divorce or dissolution exceeds the HM Revenue and
of a civil partnership, or are subject Customs lifetime allowance. Under
to a qualifying agreement in Scotland, HM Revenue and Customs rules,
your benefits will be reduced in any excess will be subject to a
accordance with the court order recovery tax charge. Most scheme
or agreement. In consequence, if you members’ pension savings will be
remarry, enter into a new civil significantly less than the allowance.
partnership or have an eligible
99
You can find more information on this

from the section on Tax Controls and
Your LGPS Benefits.
More information
booklet.
Problems.
100
Pensions and Divorce or Dissolution

of a Civil Partnership
In this section, we look at what happens to your LGPS benefits

if you get divorced or your civil partnership is dissolved.
Where pension terms are used, they you change it. If your wishes change,
appear in bold italic type. These terms contact the Fund for a new form.
are defined in the Some Terms We Use The court may, however, issue an
section. earmarking order stating that all or
part of any lump-sum death grant is
You may wish to get legal advice from payable to your ex-spouse or ex-civil
your solicitor on how to deal with your partner.
LGPS benefits during any divorce or
dissolution of a civil partnership and
you and your partner will need to What is the process to be
consider how to treat your pension followed?
rights as part of any divorce/dissolution You will need specific information
settlement. about your LGPS benefits as part of
the proceedings for a divorce, judicial
What happens to my benefits separation or nullity of marriage, or for
if I get divorced or my civil dissolution, separation or nullity of a
partnership is dissolved? civil partnership. You or your solicitor
should contact the Fund for this
• Your ex-spouse or ex-civil partner information, including an estimate of
will not be entitled to a spouse’s the cash equivalent value (CEV) of your
or civil partner’s pension should you pension rights. The court will take this
die before them. value into account in your settlement.
• Any children’s pension paid to an In Scotland, only the pension rights
eligible child in the event of your built up during your marriage/civil
death will not be affected by your partnership are taken into account.
divorce or dissolution. You usually get one free CEV estimate
• If you have said that you would like each year. Any other costs for supplying
your ex-spouse or ex-civil partner to information or complying with a court
receive any lump-sum death grant order will be recovered from you and/or
payable on your death by completing your ex-spouse or ex-civil partner in
and returning an ‘expression of wish’ accordance with a schedule of charges
form, this will remain in place unless available from the Fund.
101
All correspondence received by the Fund after age 55 with a reduction for early
in connection with divorce or dissolution payment, or can be transferred to
proceedings will be acknowledged in another qualifying pension scheme.
writing. If no acknowledgement is Your ex-spouse or ex-civil partner must
received, you should contact the Fund to take their benefits before their 75th
ensure that your correspondence has birthday.
been received.
Your pension and any lump-sum will be
The court may offset the value of your reduced by the amount allocated to your
pension rights against your other assets ex-spouse or ex-civil partner at the point
in the divorce/dissolution settlement or of divorce/dissolution.
it may issue a pension sharing order
(qualifying agreements in Scotland) or an The reduction to your benefits is known
earmarking order against your pension. as a pension debit. The amount of the
pension debit will be increased in line
Offsetting pension rights with the rise in the cost of living between
You can offset the value of your pension the date it was first calculated and the
rights against the value of other financial date your benefits are paid. When your
assets in your divorce/dissolution benefits are paid, the revalued amount of
settlement. For example, you could the pension debit will be deducted from
keep your pension, and your ex-spouse your retirement benefits and will be
or ex-civil partner could get a larger adjusted if your benefits are paid before
share of the value of the house. or after your normal pension age.
Pension sharing order You may be able to top up your benefits
If the court issues a pension sharing by buying extra scheme pension, through
order, or your benefits are subject to a APCs, paying AVCs or FSAVCs, or by
qualifying agreement in Scotland, part paying into a concurrent personal
of your benefits are transferred into pension plan or stakeholder pension
your ex-spouse's or ex-civil partner’s scheme in order to make up for the
possession. They will keep that share benefits 'lost' following a pension share.
even if your or their circumstances You can find information on paying extra
change. to increase your benefits from the section
on Contribution Flexibility.
Your ex-spouse or ex-civil partner will
hold those benefits in his/her own right. You can still transfer your remaining
They can be left in the scheme and are benefits to another pension arrangement
normally paid from their normal on leaving the LGPS. If you transfer
pension age, or can be taken on or within the LGPS, your new fund will
102
reduce your benefits by the pension ex-spouse or ex-civil partner.

debit at retirement. The earmarked benefits will be paid
to your ex-spouse or ex-civil partner
In assessing the value of your benefits when your benefits are paid, reducing
when you take them against the value of the amount paid to you.
all the pension savings you are allowed
before you become subject to a tax The order can require that your
charge (lifetime allowance), the reduced ex-spouse or ex-civil partner receives
value of your benefits after the pension one or a combination of the following:
debit has been deducted will be used.
The lifetime allowance for 2019/20 is • all or part of your LGPS pension (this
£1,055,000. Most scheme members’ doesn’t apply to divorces/dissolutions
pension savings will be significantly less in Scotland)
than the lifetime allowance. If you are a • all or part of any lump-sum10 payable
high earner affected by the introduction to you, and
of the lifetime allowance from 6 April
2006, a pension debit may affect any • all or part of any lump-sum payable on
lifetime allowance protection you may your death.
have. Also, in assessing the amount by
which the value of your pension benefits When earmarked benefits become
may increase in any one year without payable, the Fund will contact your
you having to pay a tax charge (the ex-spouse or ex-civil partner to check
annual allowance), the reduction in that the earmarking order is still valid
your benefits due to the pension debit and arrange payment of the earmarked
is ignored in the scheme year that the benefits.
pension sharing order or qualifying You can transfer your benefits to another
agreement is applied to your benefits. pension arrangement on leaving the
You can find out more about these LGPS, as long as your new pension
matters in the section Tax Controls and provider can accept the earmarking
Your LGPS Benefits. order.
Earmarking order Earmarking has limitations and is not

If the court makes an earmarking order, widely used. As the pension rights
your LGPS benefits still belong to you, remain with you, your ex-spouse or
but some are earmarked for your ex-civil partner must wait for you to retire
10
The court can order that you commute your pension, up to the maximum amount permitted, into a
lump-sum (but this power does not apply to divorces/dissolutions in Scotland)
103
or die to receive the earmarked benefits. already subject to a pension sharing

If your former spouse or civil partner order in respect of the marriage/civil
remarries or enters into a new civil partnership.
partnership an earmarking order
against pension payments, but not More information
lump-sums (unless the order directs
otherwise), would cease and the full For more information or if you have a
pension would be restored to you. problem or question about your LGPS
Pension payments to your former benefits, please contact the Fund. Contact
spouse or civil partner would cease details can be found at the front of this
on your death, although any earmarked booklet.
lump sum death grant would then The national website for members
become payable to your ex-spouse or of the LGPS is www.lgpsmember.org
ex-civil partner.
What if I remarry or enter into a if you are not happy about a decision
new civil partnership? made about your LGPS pension position
If your LGPS benefits are subject to a Problems.
pension sharing order and you remarry,
enter into a new civil partnership or
into a cohabiting partnership, any
spouse's pension, civil partner’s
pension or eligible cohabiting
partner’s pension payable following
your death will also be reduced.
If you remarry or enter into a new civil
partnership and then divorce or dissolve
your civil partnership again, your
remaining pension rights can be subject
to further division, although a pension
sharing order cannot be issued if an
earmarking order has already been
issued against your LGPS pension rights.
Similarly, an earmarking order cannot
be issued if your pension benefits are
104
Tax Controls and Your LGPS Benefits
In this section, we look at the HM Revenue and Customs

(HMRC) rules that govern pension savings.
Where pension terms are used, they Are there any limits on how
appear in bold italic type. These terms much I can pay in contributions?
section. At the present time there is no overall
limit on the amount of contributions you
There are controls on the total amount can pay, although there is a limit of
of contributions you can make into all £7,026 on the extra LGPS pension you
pension arrangements and receive tax can buy by payment of APCs. Although
relief and on the total pension savings there is no overall limit on the amount
you can have before you become subject of contributions you can pay to all
to a tax charge. This is in addition to any schemes, tax relief will only be given
tax due under the PAYE system once on contributions up to a total of 100%
your pension once it is in payment. of your taxable earnings in a tax year
You can, if you wish, pay up to 100% of (or, if greater, £3,600 to a ‘tax relief at
your UK taxable earnings in any tax year source’ arrangement, such as a
into any number of concurrent pension personal pension or stakeholder
arrangements of your choice (or, if pension scheme).
greater, £3,600 to a ‘tax relief at source’
arrangement, such as a personal pension What are the tax controls
or stakeholder pension scheme) and be on my pension savings?
eligible for tax relief on the contributions.
There are two controls: the annual
There are two main allowances for allowance and the lifetime allowance.
pension savings: an annual allowance
and a lifetime allowance. There are also Annual allowance – standard rules
protections for benefits earned up to This is the amount by which the value of
5 April 2006 if you are a high earner your pension benefits may increase in
affected by the introduction of the lifetime any one year without you having to pay a
allowance from 6 April 2006. Most people tax charge.
will be able to save as much as they wish The increase in the value of your
as their pension savings will be less than pension savings in the LGPS in a year
the allowances. is calculated by working out the value
of your benefits immediately before
the start of the ‘pension input period’
105
(PIP), increasing the value by inflation From 6 April 2016 the PIP is aligned with
and then comparing it with the value of the tax year. To facilitate this change
your benefits at the end of the special transitional arrangements applied
PIP. for 2015/16 meaning that there were two
PIPs in 2015/16 as below:
The PIP is the period over which your
pension growth is measured. From Pre-alignment tax year: 1 April 2015 to
6 April 2016, PIPs for all pension 8 July 2015 - the revised annual
schemes are aligned with the tax year – allowance during this period is
6 April to 5 April. Prior to the 2016/17 £80,000
year the PIP for the LGPS was 1 April to
31 March, except for the year 2015/16 Post-alignment tax year: 9 July 2015 to
when special transitional rules applied. 5 April 2016 – the annual allowance for
this period is the amount of the £80,000
The annual allowance in recent years has not used up from the pre-alignment tax
been as follows:
Pension input period (PIP) Annual allowance

1 April 2011 to 31 March 2012 £50,000
1 April 2012 to 31 March 2013 £50,000
1 April 2013 to 31 March 2014 £50,000
1 April 2014 to 31 March 2015 £40,000
1 April 2015 to 5 April 2016 £80,000 (transitional rules apply)
6 April 2016 to 5 April 2017 £40,000 (unless tapering applies)
6 April 2017 to 5 April 2018 onwards £40,000 (unless tapering applies)
106
year (subject to a maximum of £40,000) To carry forward unused annual

together with any carry forward available allowance from an earlier year you must
from the three previous years. have been a member of a tax-registered
pension scheme in that year.
Generally speaking, the assessment
covers any pension benefits you may Most people will not be affected by the
have in all tax-registered pension annual allowance tax charge because
arrangements where you have been an the value of their pension saving will
active member of the scheme during the not increase in a year by more than the
year, ie, you have paid contributions annual allowance or, if it does, they are
during the tax year (or your employer likely to have unused allowance from
has paid contributions on your behalf). previous years that can be carried
forward.
Carry forward
You would only be subject to an annual If, however, you are affected you will be
allowance tax charge if the value of your liable to a tax charge (at your marginal
pension savings for a year increases by rate) on the amount by which the value
more than the annual allowance for that of your pension savings for the tax year,
year. A carry forward rule allows you to less any unused allowance from the
carry forward unused annual allowance previous three years, exceeds the annual
from the previous three years. This allowance.
means that even if the value of your
pension savings increase by more than Working out whether you are affected by
£40,000 in a year you may not be liable the annual allowance is quite complex,
to the annual allowance tax charge. but this should help you work out your
For example, if the value of your general position.
pension savings in 2019/20 increased In general terms, subject to special rules
by £50,000 (ie, by £10,000 more than outlined below regarding ‘flexible access’
the annual allowance) but in the three benefits and the ‘tapered’ annual
previous years had increased by allowance for higher earners, the
£25,000, £28,000 and £30,000, then the increase in the value of your pension
amount by which each of these previous savings in the LGPS in a year is
years fell short of the annual allowance calculated by working out the value of
for those three years would more than your benefits immediately before the
offset the £10,000 excess pension saving start of the input period, increasing them
in the year 2019/20. There would be no by inflation, and comparing them with
annual allowance tax charge to pay in this the value of your benefits at the end of
case.
107
the input period. In a defined benefit • if your contributions to a money

scheme like the LGPS the value of your purchase (defined contribution)
benefits is calculated by multiplying the scheme do not exceed the money
amount of your pension by 16 and purchase annual allowance (MPAA),
adding any lump sum you are your pension savings will be tested
automatically entitled to from the against the normal £40,000 annual
pension scheme. If the difference allowance figure (as described in
between: the ‘standard annual allowance
calculation’ referred to above), or
a) the value of your benefits immediately
before the start of the input period (the • if your contributions to a money
opening value) and purchase (defined contribution)
scheme do exceed the MPAA, your
b) the value of your benefits at the end of money purchase contributions you
the input period (the closing value) plus paid before flexibly accessing your
any contributions you have paid into money purchase benefits will,
the scheme’s AVC arrangement in the together with value of your defined
year or that you and your employer benefit savings for the year, be
have paid into the scheme’s SCAVC measured against the alternative
arrangement in the year is more than annual allowance figure (see table
£40,000, you may be liable to a tax below) and your money purchase
charge. contributions paid after flexibly
The method of valuing benefits in other accessing your money purchase
schemes may be different to the method benefits will be measured against
used in the LGPS. the MPAA figure.
Annual allowance - Special rules if Alternative

annual
you have taken any ‘flexible access’ allowance
benefits from a money purchase if MPAA is
(defined contribution) arrangement Tax year MPAA exceeded
2015/16 Special See c)
If you have any benefits in a money
rules apply* below
purchase (defined contribution) pension
arrangement which you have flexibly 2016/17 £10,000 £30,000
accessed on or after 6 April 2015 then: 2017/18 £4,000 £36,000
a) in the year in which you flexibly access onwards
your money purchase benefits: *special rules apply for 2015/16 see
c) below.
108
However, if the ‘standard annual (defined contribution) scheme did not

allowance calculation’ referred to exceed £20,000, your pension savings
above would produce a higher would have been tested against the
annual allowance tax charge, then standard £80,000 annual allowance
that figure will be used instead. figure for the pre-alignment tax year
(as described above), or
b) in subsequent years:
• if your contributions to a money
• if your contributions to a money purchase (defined contribution) scheme
purchase (defined contribution) exceeded £20,000, the money
scheme do not exceed the MPAA, purchase contributions you paid before
your pension savings will be flexibly accessing your money
tested against the normal £40,000 purchase benefits would, together with
annual allowance figure, or the value of your defined benefit
• if your contributions to a money savings for the pre-alignment year,
purchase (defined contribution) have been measured against an
scheme do exceed the MPAA, your alternative annual allowance figure
annual allowance charge will be of £60,000 and your money
based on any money purchase purchase contributions paid after
(defined contribution) savings for flexibly accessing your money
the year in excess of the MPAA, plus purchase benefits would have been
the value of any defined benefit measured against an annual
savings in excess of the alternative allowance figure of £20,000.
annual allowance figure shown Post-alignment tax year –
above. It will not be possible to carry 9 July 2015 to 5 April 2016:
forward any unused money purchase
(defined contribution) annual • if flexible access occurred in the
allowance to offset against the pre-alignment tax year and your
MPAA. contributions to a money purchase
(defined contribution) scheme did not
c) Transitional rules applied for the year exceed £20,000 the annual allowance
2015/16: for this period is the amount of the
Pre-alignment tax year – £80,000 not used up from the
1 April 2015 to 8 July 2015: pre-alignment tax year (subject to a
maximum of £40,000).
• if flexible access occurred in the
pre-alignment tax year and your • if flexible access occurred in the
contributions to a money purchase pre-alignment tax year and you were
109
subject to the alternative the annual than 12 pensioner members or taking a

allowance of £60,000, the annual stand-alone lump-sum11 if you have
allowance for the post-alignment tax primary but not enhanced protection.
year is:
Please note:
- for your money purchase (defined If you have elected to transfer pension
contribution) contributions - the rights from another scheme into the
amount of the £20,000 that has not LGPS, the value of the benefits relating to
been used from the pre-alignment the transfer does not count towards your
tax year, subject to a maximum of pension savings in the LGPS in the year
£10,000. in which the transfer payment is received
except in the case of a transfer under
- for your defined benefits savings, Club transfer rules12.
the amount of the £60,000 that
has not been used from the If your pension benefits in the LGPS are
pre-alignment tax year, subject to reduced following a pension sharing
a maximum of £30,000. order or a qualifying agreement in
Scotland (issued as a result of a divorce
• if the flexible access occurred in the or dissolution of a civil partnership) then,
post-alignment tax year your for the purposes of calculating the value
contributions to a money purchase of your pension savings in the LGPS, the
(defined contribution) scheme were reduction in your benefits is ignored in
subject to an annual allowance of the year that the pension sharing order or
£10,000 and your defined benefit qualifying agreement is applied to your
savings to an annual allowance of benefits.
£30,000.
If you retire on grounds of permanent
‘Flexible access’ means taking a cash ill health and an independent registered
amount over the tax-free lump-sum from medical practitioner certifies that you are
a flexi-access drawdown account; taking suffering from ill health which makes it
an uncrystallised fund’s pension lump- unlikely that you will be able (other
sum (UFPLS); purchasing a flexible than to an insignificant extent) to
annuity; taking a scheme pension from undertake gainful work (in any capacity)
a defined contribution scheme with fewer before reaching your state pension
11
A lump-sum relating to pre-6 April 2006 where the whole amount can be taken as a lump-sum without a
connected pension.
12
In the case of members wishing to transfer from a Club scheme, the value of benefits bought in the LGPS
by such a Club transfer which does not fully relate to the amount of transfer value received will be taken into
account for annual allowance purposes. The Fund will inform you if your LGPS pension savings, in a pension
input period, is affected by a Club transfer.
110
age, there is no annual allowance tax recovered from your pension benefits.
charge on the ill-health retirement If you want the LGPS to pay some or all
benefits. of an annual allowance charge on your
behalf, you must give your notification no
It is important to note that the assessment later than 31 July in the year following the
covers any pension benefits you may end of the tax year to which the annual
have where you have been an active allowance charge relates. However, if
member during the tax year, not just you are retiring and become entitled to
benefits in the LGPS. all of your benefits from the LGPS and
The Fund will inform you if your LGPS you want the LGPS to pay some or all of
pension savings in a PIP are more than the tax charge on your behalf from your
the annual allowance not later than benefits, you must tell the Fund before
6 October following the end of the you become entitled to those benefits.
relevant tax year. The Fund will be able to tell you more
If you exceed the annual allowance in any about this and the time limits that apply.
year you are responsible for reporting Your pension fund administrator may also
this to HMRC on your self-assessment agree to pay some or all of an annual
tax return. The Fund will be able to tell allowance tax charge on your behalf in
you how much the value of your LGPS other circumstances, eg, where your
benefits have increased during an input pension savings are not in excess of the
period, plus the amount of any AVCs you standard annual allowance but are in
may have paid during the input period. excess of the tapered or money purchase
If you have an annual allowance tax annual allowance.
charge that is more than £2,000 and your
pension savings in the LGPS alone have The general exemption from the annual
increased in the tax year by more than allowance for the relatively small number
the standard annual allowance you may of scheme members who applied to
be able to opt for the LGPS to pay some HMRC for, and received, an enhanced
or all of the tax charge on your protection certificate ceased on 6 April
behalf. The tax charge would then be 2011.
111
Tapered annual allowance for higher earners
From the tax year 2016/17 the annual excess of £150,000. For every £2 that
allowance is tapered for members who your adjusted income exceeds £150,000,
have a ‘threshold income’ in excess of your annual allowance is reduced by £1
£110,000, and ‘adjusted income’ in (to a minimum of £10,000).
Definition Limit
Threshold income Broadly your taxable income after the £110,000

deduction of your pension contributions
(including AVCs deducted under the net
pay arrangement)
Adjusted income Broadly your threshold income plus £150,000
pensions savings built up over the tax year
Threshold income includes all sources of salary sacrifice made on or after 9 July
income that are taxable, eg, property 2015.
income, savings income, dividend
How does the taper work?
income, pension income, social security
From 6 April 2016, the taper reduces the
income (where taxable), state pension
income etc. annual allowance by £1 for £2 of adjusted
income received over £150,000, until a
Please note: you are not allowed to minimum annual allowance of £10,000 is
deduct from taxable income any amount reached. This means that from 6 April
of employment income given up for 2016, the annual allowance for high
pension provision as a result of any earners is as follows:
Adjusted income Annual allowance

£150,000 or below £40,000
£160,000 £35,000
£170,000 £30,000
£180,000 £25,000
£190,000 £20,000
£200,000 £15,000
£210,000 or above £10,000
112
Example 1
Cerys
Gross salary 2019/20 £120,000
Less employee pension contributions £13,680 11.4%
Threshold income 2019/20 £106,320 Below £110,000 so the AA will not
be tapered and remains at £40,000
Pensions saving in the year £39,184 Less than £40,000 so no tax charge
Example 2
Sanjay
Gross salary 2019/20 £130,000
Less employee pension contributions £14,820 11.4%
Plus taxable income from property £30,000
Threshold income 2019/20 £145,180
Plus pensions saving in the year £42,449
Adjusted income 2019/20 £187,629 Greater than £150,000 so AA
will be tapered
Tapered AA £21,186*
In excess of AA £21,263 Pension saving of £42,449
less tapered AA
AA tax charge at marginal rate
(assumed to be 40%) £8,505 £21,263 x 40%
* *Taper = £187,629 - £150,000 = £37,629/ 2 = £18,814. Standard AA £40,000 less £18,814 = £21,186
Please note, the examples above make no allowance for any carry forward or inflationary adjustment. The pension
savings in the year are based on the assumption that both Sanjay and Cerys have no final salary benefits in the LGPS and
that they are not paying any additional contributions.
113
Lifetime allowance
The lifetime allowance is the total value of The lifetime allowance was introduced in
all pension benefits you can have without 2006 and was reduced in 2012, 2014 and
triggering an excess benefits tax charge. 2016. Each time the lifetime allowance
If the value of your pension benefits when reduced, if you had already planned your
you take them (not including any state pension savings on the basis of the higher
retirement pension, state pension credit lifetime allowance you could protect your
or any spouse’s, civil partner’s, eligible pension savings by applying to HMRC for
cohabiting partner’s or dependant’s a protection certificate.
pension you may be entitled to) is more
than the lifetime allowance, or more than The lifetime allowance steadily reduced
any protections you may have (see from 2012/13 to 2017/18. From 2018/19
below), you will have to pay tax on the onwards the lifetime allowance increases
excess benefits. The lifetime allowance each year in line with inflation, see below:
covers any pension benefits you may
have in all tax-registered pension
arrangements – not just the LGPS.
Tax year Lifetime allowance

2011/12 £1.8 million
2012/13 £1.5 million
2013/14 £1.5 million
2014/15 £1.25 million
2015/16 £1.25 million
2016/17 £1.00 million
2017/18 £1.00 million
2018/19 £1.03 million
2019/20 £1.055 million
114
For pensions that are taken on or after individual protection 2016. Information
6 April 2006, the capital value of those on these is provided below.
pension benefits is calculated by
multiplying your pension by 20 and Primary lifetime allowance protection
adding any lump sum you take from the Primary protection is aimed at protecting
pension scheme. benefits earned up to 5 April 2006 for
those high earners affected by the
For pensions already in payment before introduction of the lifetime allowance
6 April 2006, the capital value of these is from 6 April 2006, ie, those whose
calculated by multiplying the current benefits at 5 April 2006 already had a
annual rate, including any pensions capital value in excess of the 2006/07
increase, by 25. Any lump sum already lifetime allowance of £1.5 million.
paid is ignored in the valuation.
If the value of your pension benefits at
When any LGPS benefit, or any other 5 April 2006 was more than the 2006/07
pension arrangement you may have, is lifetime allowance of £1.5million and you
put into payment you use up some of your have registered for primary protection,
lifetime allowance – so even if your you have an individual lifetime allowance
pensions are small and will not be more based on how much your benefits at
than the lifetime allowance, you should 5 April 2006 exceeded the value of the
keep a record of any pensions you
2006/07 standard lifetime allowance.
receive. If you have a pension in payment
Your individual lifetime allowance
before 6 April 2006, this will be treated
increases at the same rate as the
as having used up part of your lifetime
allowance. standard lifetime allowance. So, if your
benefits at 5 April 2006 exceeded the
If your LGPS benefits are more than your 2006/07 standard lifetime allowance by
lifetime allowance, you will have to pay 10%, your individual lifetime allowance
tax on the excess. If excess benefits are will always be 10% higher than whatever
paid as a pension the charge will be 25%, the standard lifetime allowance is in
with income tax deducted on the ongoing future years.
pension payments; if the excess benefits
are taken as a lump-sum, they will be If your pension rights are shared on
taxed once only at 55%. divorce or dissolution of a civil
partnership, this will result in the
There are protections called primary individual lifetime allowance being
lifetime allowance protection, enhanced reduced (or lost if it reduces to below
protection, fixed protection, fixed the standard lifetime allowance).
protection 2014, fixed protection 2016,
individual protection 2014, and
115
To have primary protection you must start a new pension arrangement, or if

have registered for it with HM Revenue you transfer your LGPS benefits to
and Customs by 5 April 2009. another defined benefit pension
scheme. You can also voluntarily give
Enhanced protection up enhanced protection by giving notice
You could register for enhanced that you no longer wish to keep it.
protection (as well as primary protection)
if the value of your pension benefits at If you lose enhanced protection, you must
5 April 2006 was more than the 2006/07 notify HMRC within 90 days. Failure to do
lifetime allowance of £1.5million. so could result in a fine of up to £3,000.
You could also register for enhanced To have enhanced protection, you must
protection if you believed the value of have registered for it with HM Revenue
those benefits might in the future be and Customs by 5 April 2009.
more than the standard lifetime
allowance or if you believed your Transitional protection: lump-sums
pension benefits in any one year would If you were in the LGPS before 1 April
increase by more than the annual 2008, you will be entitled to an automatic
allowance. Under enhanced protection, lump sum from the LGPS when you take
you will not pay tax on benefits in excess your benefits, in addition to your pension.
of the lifetime allowance provided your There are two types of lump-sum
benefits at retirement do not exceed the protection available. These relate to
value of your benefits at 5 April 2006 as members who, at 5 April 2006, either:
increased after then, in general terms, • had built up a lump-sum of £375,000 or
by the greater of 5% per annum, the more and had applied for primary
increase in the cost of living or increases and/or enhanced protection, or
in your pensionable pay. If the limit is
exceeded you will pay tax on the excess. • had built up a lump-sum that was more
You will lose enhanced protection if you than 25% of the value of any pension
pay contributions into a money purchase rights not in payment at that time.
pension arrangement (eg, pay into the
LGPS arranged AVC facility13) or if you
13
You will not lose enhanced protection if you were paying AVCs at 5 April 2006 purely for extra life cover and
carry on doing so after that date, provided the terms are not varied significantly from those that applied under
the policy at 5 April 2006 so as to increase the level of life cover or extend the period during which such
benefits are payable, eg, you do not adjust the premiums to purchase increased life cover.
116
It is expected that very few (if any) LGPS than to a life assurance policy providing
members will have built up lump-sums death benefits that started before
that meet either of these limits. 6 April 2006. You will also be subject to
Information on the protection can be restrictions on where and how you can
found on the HMRC website: transfer benefits.
www.gov.uk/hmrc-internal-manuals/
pensions-tax-manual/ptm092100 If you lose fixed protection, you must
notify HM Revenue & Customs (HMRC)
Fixed protection within 90 days. Failure to do so could
The lifetime allowance reduced to £1.5 result in a fine of £300 and a penalty of
million on 6 April 2012 and fixed up to £60 per day after the initial fine has
protection was introduced. You can't been issued until you supply them with
have fixed protection if you have either the required notification.
primary or enhanced protection. With
fixed protection your lifetime allowance To have fixed protection you must have
is fixed at £1.8 million. applied to HMRC in their prescribed form
on or before 5 April 2012.
The maximum tax free lump-sum you can
take on retirement is the lesser of: Fixed protection 2014
The lifetime allowance reduced to
• 25% of the capital value of your LGPS £1.25 million on 6 April 2014 and a new
benefits, or protection called fixed protection 2014
was introduced. Individuals who
• 25% of the lifetime allowance which, expected their pension savings to be
for those with fixed protection 2014, more than £1.25 million (including taking
is £450,000 (ie, 25% of your lifetime into account past benefits already in
allowance of £1.8 million) or if you payment) when they retired after 5 April
have previously taken payment of 2014 could apply for fixed protection
(crystallised) pension benefits 25% of 2014 to help reduce or mitigate the
the remaining lifetime allowance. lifetime allowance charge. You can't
You will lose fixed protection if you start a have fixed protection 2014 if you already
new pension arrangement, other than to have primary, enhanced or fixed
accept a transfer of existing pension protection. With fixed protection 2014
rights, or if your benefits increase by your lifetime allowance is fixed at £1.5
more than the cost of living increases, million rather than the standard lifetime
or if you pay contributions into a money allowance.
purchase pension arrangement other
117
The maximum tax free lump sum you can LGPS with effect from 6 April 2016 or
take on retirement is the lesser of: before.
• 25% of the capital value of your LGPS If you lose fixed protection 2014, you
benefits, or must notify HM Revenue & Customs
(HMRC) within 90 days. Failure to do so
• 25% of the lifetime allowance which, could result in a fine of £300 and a
for those with fixed protection, is penalty of up to £60 per day after the
£375,000 (ie, 25% of your lifetime initial fine has been issued until you
allowance of £1.5 million) or if you supply them with the required
have previously taken payment of notification.
(crystallised) pension benefits 25% of
the remaining lifetime allowance. To have fixed protection 2014, you must
have applied to HMRC in their prescribed
You will lose fixed protection 2014 if you form on or before 5 April 2014.
start a new pension arrangement, other
than to accept a transfer of existing Individual protection 2014
pension rights, or if your benefits Individual protection 2014 was introduced
increase by more than the cost of living when the lifetime allowance reduced to
increases, or if you pay contributions into £1.25 million on 6 April 2014.
a money purchase pension arrangement
other than to a life assurance policy Individual protection 2014 gives a
providing death benefits that started protected lifetime allowance equal to the
before 6 April 2006. You will also be value of your pension rights on 5 April
subject to restrictions on where and 2014 - up to a maximum of £1.5 million.
how you can transfer benefits. You will not lose individual protection
2014 by making further savings in to your
You would have lost fixed protection 2014 pension scheme but any pension savings
if you are an active member of the LGPS in excess of your protected lifetime
on or after 6 April 2016. Fixed protection allowance will be subject to a lifetime
2014 is lost if your benefits increase by allowance charge.
more than the cost of living increase.
As the cost of living increase for the year Your application for individual protection
2016/17 was zero, any pension build up, 2014 must have been received by HMRC
however small, would have led to your no later than 5 April 2017.
pension increasing by more than zero. You can hold both fixed protection 2014
Therefore, if you applied for and wished and individual protection 2014, but you
to keep, fixed protection 2014 you would can't apply for them at the same time.
have needed to have opted out of the
118
You can also hold individual protection • 25% of the lifetime allowance which,
while holding either enhanced protection for those with fixed protection, is
or fixed protection, but you couldn't apply £312,500 (ie, 25% of your lifetime
for individual protection if you already allowance of £1.25million) or if you
held primary protection. have previously taken payment of
(crystallised) pension benefits, 25% of
For more information on individual the remaining lifetime allowance.
protection 2014 see:
www.gov.uk/government/publications/ Please note, you would have lost fixed
pensions-individual-protection-2014 protection 2016 if you are an active
member of the LGPS, or were an active
Fixed protection 2016 member on or after 6 April 2016. Fixed
The lifetime allowance reduced to protection 2016 is lost if your benefits
£1 million on 6 April 2016 and a new increase by more than the cost of living
protection called fixed protection 2016 increase. As the cost of living increase for
was introduced. You are able to apply the year 2016/17 was zero, any pension
for fixed protection 2016 if you expect build up, however small, would have led
your pension savings to be more than to your pension increasing by more than
£1 million (including taking into account zero. Therefore, if you applied for and
past benefits already in payment) when wished to keep, fixed protection 2016 you
you come to take them on or after would have needed to have opted out of
6 April 2016. Fixed protection 2016 can the LGPS with effect from 6 April 2016 or
be used to help reduce or mitigate the earlier.
lifetime allowance charge.
Fixed protection 2016 will also be lost if
You can't have fixed protection 2016 if you start a new pension arrangement,
you already have primary, enhanced, other than to accept a transfer of
fixed protection 2012 or fixed protection existing pension rights, or if you pay
2014. contributions into a money purchase
pension arrangement, other than to a
With fixed protection 2016 your lifetime life assurance policy providing death
allowance is fixed at £1.25 million rather benefits that started before 6 April 2006.
than the standard lifetime allowance. You will also be subject to restrictions on
The maximum tax-free lump-sum you where and how you can transfer benefits.
can take on retirement is the lesser of:
• 25% of the capital value of your LGPS
benefits, or
119
If you lose fixed protection 2016 you must Applying for fixed and individual
electronically notify HMRC within 90 days protection 2016
of the day on which you could first HMRC introduced an online self-service
reasonably be expected to have known for pension scheme members to apply
that an event had occurred causing you to for individual protection 2016 or fixed
have lost this protection. Failure to do so protection 2016.
could result in a fine of £300 and a penalty
of up to £60 per day after the initial fine Once you have successfully applied for
has been issued until you supply them with protection the online service will provide
the required notification. you with reference numbers which you
will need to keep.
Individual protection 2016
In addition to fixed protection 2016, More information
individual protection 2016 was also
introduced when the lifetime allowance For more information or if you have a
reduced to £1 million on 6 April 2016. problem or question about your LGPS
You can apply for individual protection benefits, please contact the Fund. Contact
2016 if you had pension savings valued details can be found at the front of this
at over £1 million (including taking into booklet.
account past benefits already in payment) The national website for members
on 5 April 2016. However, if you have of the LGPS is www.lgpsmember.org
primary protection or individual
protection 2014 you can’t apply for You can find out about what you can do
individual protection 2016. if you are not happy about a decision
Individual protection 2016 gives a from the section Help with Pension
protected lifetime allowance equal to the Problems.
value of your pension rights on 5 April
2016 - up to a maximum of £1.25 million.
You will not lose individual protection
2016 by making further savings into your
pension scheme but any pension savings
in excess of your protected lifetime
allowance will be subject to a lifetime
allowance charge.
120
Help with Pension Problems
In this section, we look at what you can do if you are not happy
about a decision made about your LGPS pension position.
Who can help me if I have a Internal disputes resolution procedure

query or complaint? In the first instance, you should write to
the adjudicator appointed by the body
If you are in any doubt about your who made the decision about which you
LGPS benefit entitlements, or have a wish to appeal. You must do this within
problem or question about your LGPS six months of the date of the notification
membership or benefits, please contact of the decision or the act or omission
the Fund. Contact details can be found about which you are complaining (or such
at the back of this booklet. We will seek to longer period as the adjudicator considers
clarify or put right any misunderstandings reasonable). This is a formal review of
or inaccuracies as quickly and efficiently the initial decision or act or omission and
as possible. is an opportunity for the matter to be
reconsidered. The adjudicator will
If your query is about your contribution consider your complaint and notify you
rate, please contact your employer’s of his or her decision.
personnel/HR or payroll section so they
can explain how they have decided If you are dissatisfied with that person’s
which contribution band you are in. decision, (or their failure to make a
decision) you may apply to the Fund’s
If you are still dissatisfied with any administering authority, the City of
decision made in relation to the scheme, Wolverhampton Council, to have it
you have the right to have your complaint reconsidered.
reviewed under the scheme’s internal
disputes resolution procedure. There are The Fund can tell you who your
also a number of other regulatory bodies employer's/the Fund’s administering
that may be able to assist you. authority’s adjudicator is and supply
you with a more detailed leaflet on the
Here are the various ways you can ask internal disputes resolution procedure
for help with a pension problem. and relevant time limits together with
a form to fill in or you can ask your
employer. Contact details can be found
at the front of this booklet.
121
The Pensions Advisory Service • death benefits

(TPAS) • failure to provide information or act on
TPAS provide independent and impartial instructions
information about pensions, free of
charge, to members of the public. • ill health
TPAS is available to assist members • interpretation of scheme rules
and beneficiaries of the scheme with any
pension query they have or any general • misquote or misinformation
requests for information or guidance
concerning their pension benefits. TPAS • transfers
can be contacted: You have the right to refer your complaint
to TPO free of charge. There is no
In writing:
financial limit on the amount of money
11 Belgrave Road
that TPO can make a party award you.
London
Its determinations are legally binding on
SW1V 1RB
all parties and are enforceable in court.
By telephone:
Contact with TPO about a complaint
Tel: 0800 011 3797
needs to be made within three years of
Website: when the event(s) you are complaining
www.pensionsadvisoryservice.org.uk about happened – or, if later within three
(where you can submit an online years of when you first knew about it (or
enquiry form). ought to have known about it). There is a
discretion for these time limits to be
The Pensions Ombudsman (TPO) extended. TPO can be contacted:
TPO deals only with pension complaints.
In writing:
It can help if you have a complaint or
10 South Colonnade
dispute about the administration and/or
Canary Wharf
management of personal and
E14 4PU
occupational pension schemes. Some
examples of the types of complaints it By telephone:
considers are (this list is not exhaustive): 0800 917 4487
• automatic enrolment Website:
www.pensions-ombudsman.org.uk
• benefits: including incorrect calculation, (where you can submit an online
failure to pay or late payment complaint form)
122
The Pensions Regulator By telephone:

This is the regulator of work-based 0800 731 0193
pension schemes. The Pensions Regulator
Website:
has powers to protect members of
www.gov.uk/find-lost-pension
work-based pension schemes and a
wide range of powers to help put matters Don’t forget to keep your pension
right, where needed. In extreme cases, providers up to date with any change
the regulator is able to fine trustees or in your home address.
employers, and remove trustees from a
scheme. You can contact the Pensions More information
Regulator:
By telephone: problem or question about your LGPS
0345 600 7060 benefits, please contact the Fund. Contact
Website: details can be found at the front of this
www.thepensionsregulator.gov.uk booklet.
How can I trace my pension rights? of the LGPS is www.lgpsmember.org
The Pension Tracing Service holds
details of pension schemes, including the
LGPS, together with contact addresses.
It provides a tracing service for
ex-members of schemes with pension
entitlements (and their dependants) who
have lost touch with previous schemes.
All occupational and personal pension
schemes have to register if the pension
scheme has current members
contributing to the scheme or people
expecting benefits from the scheme.
You can contact the Pension Tracing
Service:
In writing:
The Pension Tracing Service
The Pension Service 9
Mail Handling Site A
Wolverhampton
WV98 1LU
123
If You Joined the LGPS Before 1 April 2014
The LGPS changed from a final salary scheme to a career

average scheme on the 1 April 2014.
Where pension terms are used, they For membership built up from 1 April
appear in bold italic type. These terms 2008 to 31 March 2014, you receive a
are defined in the Some Terms We Use pension of 1/60th of your final pay.
section. There is no automatic lump-sum for
membership built up after March 2008,
How are benefits worked out? but you do have the option to exchange
some of your pension for a tax-free
Your benefits in the LGPS built up
lump-sum.
before 1 April 2014 are based on your
membership in the Scheme up to For membership built up from 1 April
31 March 2014 and your final pay when 2014, every year you will build up a
you leave the scheme. The benefits pension at a rate of 1/49th of the amount
based on membership to 31 March 2008 of pensionable pay you received in that
are calculated slightly differently from scheme year if you are in the main
benefits based on membership between section of the scheme (or half this rate of
1 April 2008 and 31 March 2014. build up for any period you have elected
to be in the 50/50 section of the scheme).
For membership built up to 31 March This pension is then added to your
2008, you receive a pension of 1/80th of pension account and revalued at the
your final pay plus an automatic tax-free end of each scheme year so your
lump-sum of three times your pension. pension keeps up with the cost of living.
124
Here is an example of how benefits are worked out if you have membership
from before 31 March 2008 onwards.
Let’s look at someone who has:

• Eight years’ membership up to 31 March 2008
• Six years’ membership from 1 April 2008 to 31 March 2014
• Five years’ membership from 1 April 2014 until they retire at their
normal pension age
Their final pay for benefits in the final salary scheme is £26,500
Benefits based on their eight years’ membership up to 31 March 2008

Annual pension: 8/80ths x £26,500 = £2,650
plus a tax-free lump-sum: 3 x 8/80ths x £26,500 = £7,950
Benefits based on their six years’ membership from 1 April 2008 to

31 March 2014
Annual pension: 6/60ths x £26,500 = £2,650
Benefits based on their four years’ membership from 1 April 2014

(in main section throughout)
Year Opening Pension built up Total account Cost of living Updated
balance in year 31 March adjustment total account
1 £0.00 £25,200/49 = £514.29 £514.29 £6.17 (1.2%) £520.46
2 £520.46 £25,700/49 = £524.49 £1,044.95 -£1.04 (-0.1%) £1,043.91
3 £1,043.91 £26,000/49 = £530.61 £1,574.52 £15.75 (1.0%) £1,590.27
4 £1,590.27 £26,250/49 = £535.71 £2,125.98 £63.78 (3.0%) £2,189.76
5 £2,189.76 £26,500/49 = £540.82 £2,730.58 £65.53 (2.4%) £2,796.11
To give total benefits of:
Annual pension: £8,096.11 (£2,650 + £2,650 + £2,796.11)
Tax-free lump-sum: £7,950.00
125
But remember that you can choose to Membership built up before 1 April
exchange some of your pension for extra 2014 normally includes:
tax-free lump-sum. You can take up to
25% of the capital value of your LGPS ben- • How long you have been a member
efits as a lump-sum14. For every £1 of an- of the LGPS before 1 April 2014
nual pension that you give up, you will worked out in years and days, but
receive an extra £12 lump-sum. excluding:
If you transferred previous non-LGPS pen- - pre-1 April 2014 membership for
sion rights, or pension rights from the which you already receive an LGPS
LGPS in Scotland or Northern Ireland, into pension or hold an LGPS deferred
your current membership, then the reval- pension
ued amount of the pension benefits bought
by the transfer will be added to the retire- - pre-1 April 2014 membership from
ment benefits as calculated above. any concurrent job you may have,
and
What counts towards - any LGPS membership in respect of
membership in the scheme which you have received a refund or
before 1 April 2014? have transferred the pension rights
to another scheme.
Your benefits in the LGPS built up
before 1 April 2014 are based on your • Membership purchased by a transfer
membership built up in the scheme from another scheme where the
before this date and your final pay relevant date for the transfer was
when you leave the scheme. before 1 April 2014.
• Any extra membership you have
bought with additional contributions or
by converting in-house AVCs into
membership.
• Any extra membership awarded by
your employer before 1 April 2014.
14
Limited to £263,750 (2019/20 figure) or if you have previously taken payment of (crystallised) pension
benefits 25% of your remaining lifetime allowance.
126
The membership used to calculate your What counts towards final pay
benefits could be different to your actual to work out my benefits in the
calendar length membership of the LGPS
before 1 April 2014. For example: LGPS before 1 April 2014?
If you worked part-time before 1 April While the scheme changed on 1 April
2014, your membership is reduced to its 2014, protection is in place to ensure
whole-time equivalent length to calculate that, when you leave, your final pay is
the amount of your retirement benefits. used to work out your pension for the
For example, if you worked half-time membership you built up to 31 March
for ten years, your benefits would be 2014.
calculated on five years’ membership. The definition of final pay for benefits
built up before 1 April 2014 remains the
If your hours changed during your same as before the scheme changed
membership of the scheme before from a final salary to a career average
1 April 2014, your benefits will be scheme on 1 April 2014 .
calculated to reflect the changes.
Final pay for pre-1 April 2014
If you did not have any contractual benefits
hours, your membership for each year
in the LGPS before 1 April 2014 will be This is usually the pay in respect of
calculated on average weekly hours (ie, due for) the final year15 of scheme
worked during each year. membership on which you paid
contributions, or one of the previous
If you have transferred membership two years if this is higher, and includes
from the LGPS in Scotland or your:
Northern Ireland, it may not count at
its actual calendar length. • normal pay
• contractual shift allowance
• bonus
• contractual overtime
• maternity pay, paternity pay, adoption
pay, shared parental pay, and
• any other taxable benefit specified in
your contract as being pensionable.
15
Grossed up to a full year’s pay if you did not receive pay for a full year.
127
This may not include all your pay. Your If your pay is reduced in this period
final pay does not include: because of sickness, your final pay will
be the pay that you would have received
• non-contractual overtime if you had not been off sick.
• travelling or subsistence allowances If you have maternity, paternity,
• pay in lieu of notice adoption or shared parental leave
in this period for which you paid (or
• pay in lieu of loss of holidays are deemed to have paid) pension
contributions, final pay includes the pay
• any payment as an inducement not to you would have received had you not
leave before the payment is made been on maternity, paternity, adoption or
• any award of compensation (other than shared parental leave.
payment representing arrears of pay) If your pay is reduced or increases to
made for the purpose of achieving your pay are restricted in your last ten
equal pay, nor years of continuous employment with
• the monetary value of a car or pay your employer because you downgrade
received in lieu of a car (apart from or move to a job with less responsibility,
some historical cases). or as a result of a job evaluation/equal
pay exercise, or because of a change to
If you receive pay after 31 March 2014 what is specified as pensionable pay in
which relates to work carried out before your contract (using the definition of
1 April 2014, this will be allocated to the pensionable pay before 1 April 2014),
pre-1 April 2014 period for which it or is restricted for some other reason,
was due. It will not count towards the you may have the option to have your
pensionable pay used to work out your final pay calculated as the average of
pension from 1 April 2014 in the career any three consecutive years’ pay in the
average scheme. last 13 years (ending on a 31 March).
Such an option must be made to the Fund
If you are working part-time when you no later than one month before leaving.
leave the LGPS, or worked part-time at You cannot make use of this option to use
some point during your last year of earlier years’ pay in working out your
membership, your final pay is the benefits if the reduction or restriction to
whole-time pay that you would have your pay was as a result of the loss of a
received, if you had worked whole-time. temporary increase in pay, or resulted
from a reduction in your grade in order
to take retirement benefits on flexible
retirement.
128
What if I am paying extra? take out an APC contract – see the

Contribution Flexibility section for more
Also included in your pre-1 April 2014 information.
benefits are the following:
You can choose to exchange some of the
If you are buying extra LGPS pension extra pension you have bought for a cash
by paying ARCs lump-sum in the same way as your main
You will be credited with the extra LGPS pension.
pension that you have paid for. This will
increase the value of your retirement If you are buying extra years in the
benefits. LGPS (added years)
Please note that for LGPS added years
But if you are paying ARCs when you contracts, the contribution amount you
retire and qualify for the type of ill-health pay is based on a percentage of the
pension where your benefits are based definition of pensionable pay before
on enhanced membership, you will be 1 April 2014 (see above section on
credited with all the extra pension that Final pay for pre-1 April 2014 benefits
you set out to buy, even if you have not for further information).
completed full payment for it.
You will be credited with the extra years
If you take your benefits before age 65 of membership that you have paid for
(other than on the grounds of permanent and you will receive extra retirement
ill health), or you are retired on benefits calculated on the same basis that
redundancy or business efficiency you agreed to buy them – but see below
grounds, the extra pension you have for the rules on ill-health retirement.
bought through an ARC will be reduced
for early payment. If you retire on ill-health grounds while
paying for extra years, you will normally
If you take your benefits on flexible be credited with the whole extra period of
retirement, you can, if you wish, take membership that you set out to buy, even
all the extra pension you have paid for, if you have not completed full payment
although it will be reduced for early for it.
payment. If you choose to take the
extra pension on flexible retirement, your If you retire early because of redundancy
ARC contract will cease (if you are still or business efficiency while paying for
paying the extra contributions when you extra years, you will have the opportunity
draw your flexible retirement benefits). to pay the remaining contributions due in
You will not be able to take out a new a lump sum in order to complete your
ARC contract, but you will be able to contract.
129
If you take your benefits on flexible Your contributions will cease when you
retirement and you elected before cease to contribute to the LGPS (or cease
1 October 2006 to commence your two days before age 75 if you carry on in
added years contract you will be credited work beyond that age). However, the
with the extra years of membership that rules are slightly different if you take
you have paid for and this will increase flexible retirement, as explained later.
the value of your benefits paid on
flexible retirement. If you elected on or Here are the different ways you may be
after 1 October 2006 to commence your able to use your in-house AVC fund when
added years contract, you can, if you you retire:
wish, choose to be credited with the Buy one or more annuities
extra years of membership that you have This is where an insurance company,
paid for at the point of flexible retirement bank or building society of your choice
and this will increase the value of your takes your AVC fund and pays you a
benefits paid. If you choose to be credited pension in return.
with the extra years of membership on
flexible retirement, your added years An annuity is paid completely separately
contract will cease (if you are still paying from your LGPS benefits.
these extra contributions when you take
your benefits). If you do not choose to The amount of annuity depends on
be credited with the extra years of several factors, such as interest rates
membership on flexible retirement, and your age. You also have some
your added years contract will continue. choice over the type of annuity, for
example whether you want a flat-rate
If your pre-1 April 2014 benefits, when pension or one that increases each
you take them, are reduced for early year, and whether you also want to
payment then your benefits from the provide for dependants’ benefits in the
added years are reduced in the same event of your death.
way.
Annuities are subject to annuity rates
If you are paying AVCs arranged which in turn are affected by interest
through the LGPS (in-house AVCs) rates.
You can pay up to 100% of your
pensionable pay into an in-house AVC.
Your employer can also pay towards When interest rates rise, the organisation
your AVC at their discretion – this is selling annuities is able to obtain a greater
known as a shared-cost AVC. income from each pound in your AVC
fund, and therefore can provide a higher
130
pension. A fall in interest rates reduces Transfer your AVC fund to another
the pension which can be purchased. pension scheme or arrangement
You can transfer your AVC fund to
Buy a top-up LGPS pension another pension scheme or arrangement,
If you were an active member of the including to a scheme that offers flexible
LGPS on or after 1 April 2014, you can benefits, independently of your main
buy a top-up pension with your AVC plan scheme benefits; and provided you have
when you retire. Dependants’ benefits stopped paying AVCs, you can even
will automatically be provided in the transfer your AVC fund even if you
event of your death. The top-up pension continue to contribute to the LGPS. If you
you buy will increase in line with inflation. choose to transfer your AVC, the transfer
Buy extra membership in the LGPS must be completed before your main
If your election to start paying AVCs was LGPS benefits are paid to you.
made before 13 November 2001, you If you were to transfer your AVC fund
may be able in certain circumstances to a defined contribution scheme which
(such as flexible retirement, retirement on provides flexible benefits, the four main
ill-heath grounds, or on ceasing payment flexible benefit options that scheme might
of your AVCs before retirement) to offer (from age 55) are:
convert your AVC fund into extra LGPS
membership in order to increase your • purchasing an annuity (yearly pension)
LGPS benefits. The extra membership or scheme pension
will attract a pension of 1/60th of your
final pay for each year of membership • taking a number of cash sums at
purchased. different stages
Take your AVCs as cash • taking the entire pot as cash in one go
You can take some or all of your AVC • flexi-access drawdown – using your
fund as a tax-free lump-sum16, but you pension pot to provide a flexible
can only take it all as a lump-sum if you income. You are normally allowed to
take it at the same time as your main take a tax-free lump-sum of up to 25%
LGPS benefits and provided, when added then set aside the rest to provide
to your LGPS lump-sum, it does not taxable lump-sums as and when, or a
exceed 25% of the overall value of your regular taxable income.
LGPS benefits (including your AVC fund).
16
Provided, when added to your LGPS lump-sum, it does not exceed 25% of the overall value of your LGPS
benefits (including your AVC fund) and the total lump-sum does not exceed £263,750 (2019/20 figure), or if
you have previously taken payment of (crystallised) pension benefits, 25% of your remaining lifetime
allowance.
131
You should be aware that there may be • If you left the LGPS before 1 April
tax implications associated with accessing 2014
flexible benefits. The income from a If you left the LGPS before 1 April
pension is taxable; the rate of tax you 2014, and did not take immediate
would pay depends on the amount of payment of your LGPS benefits then
income that you receive from a pension not all the AVC options listed above will
and from other sources. be open to you on retirement.
Pension guidance is available from the
Government’s guidance website Pension If you take your AVC at the same time
Wise if you are considering taking flexible as your main LGPS benefits then you
benefits. The guidance is free and will be able to take it as tax-free cash
impartial and can be accessed on the (subject to the same restrictions set out
internet, by phone, or face to face. on the previous page), use it to buy one
For more information, see or more annuities, or a combination
www.pensionwise.gov.uk of these two options.
If you are considering taking flexible You will have the option to delay
benefits, you should consider accessing payment of the AVC fund until a date
this pension guidance and taking later than the date your main LGPS
independent advice to help you decide benefits are paid to you. Your AVC
which option is most suitable for you. must be paid to you before age 75.
If you delay payment then the
Please note: Pension Wise does not maximum tax-free lump sum you will
provide guidance about taking benefits be able to receive from the AVC fund
from a defined benefit scheme such as is 25% of the AVC fund value (or, if
the LGPS. lower, 25% of your available lifetime
allowance).
If you are thinking of transferring your
AVC plan, you should be aware that If you left the LGPS before 1 April 2014
scammers operate in these markets and and your AVC has not yet been paid,
are after your pension. To help protect you will not be able to use your AVC
yourself from scammers, see The fund to buy a top-up pension in the
Pension Regulator's website. LGPS or to buy extra LGPS
membership.
132
You have the option of transferring If you are paying for extra life cover
your AVC fund to another pension through AVCs
scheme or arrangement. If you left the Any extra life cover paid for through
LGPS before 1 April 2014, an AVC AVCs will stop on leaving (or cease at age
transfer can be completed before or 75 if you carry on in work beyond that
after your main LGPS benefits are paid age). You cannot pay AVCs after leaving
to you. or after age 75.
Details of your AVC options will be If you are paying additional
provided to you before your retirement. contributions to buy extra eligible
cohabiting partner’s survivor
If you take benefits on flexible benefits
retirement and your AVC contract If, before 1 April 2014, you entered into
started on or after 13 November 2001, a contract for your pre 6-April 1988
you can choose to take all of your AVC membership to count for a cohabitee
fund at the time you take your flexible survivor's pension this contract can
retirement benefits, and, if you wish, continue after 1 April 2014 (but
continue paying AVCs. If your AVC cannot commence after this date).
contract started before 13 November The contribution amount you pay is
2001, your AVC contract will cease and based on a percentage of the definition
you will have to use all of your AVC fund of pensionable pay before 1 April 2014
in one of the above ways at the time you (see above section on Final pay for
take your flexible retirement benefits. pre-1 April 2014 benefits for further
If you leave before retirement, your information).The extra benefit that
AVC contributions will cease when you you have paid for will be included in
leave. calculating any survivor pension
payable to an eligible cohabiting
The value of your AVC fund will continue partner on your death.
to be invested until it is paid out. Your
AVC plan can be transferred to another But if you are still paying these
pension arrangement or taken at the contributions when you retire, only
same time as your LGPS benefits. that proportion of the extra benefit you
have paid for will count, unless you
Payments into in-house AVCs will stop qualify for the type of ill health pension
when you leave or retire. where your benefits are based on
enhanced membership. If so, the whole
of the extra benefit you set out to buy
will be included in calculating any
133
survivor pension payable to an eligible The earnings cap was removed from
cohabiting partner, even if you have 6 April 2006 and, if it affected you, your
not completed full payment for it. relevant membership before that date
will be reduced.
Other points to note if you joined the
LGPS before 1 April 2014: When can I take my LGPS
If you have been awarded extra benefits built up before 1 April
membership by your employer and the 2014?
date your employer resolved to award
this was between 1 April 2008 and While the scheme changed on 1 April
31 March 2014, those years will 2014, protection is in place if you built up
attract a pension at the rate of 1/60th of benefits in the final salary scheme which
your final pay for each year of means that the normal pension age for
membership awarded and will be added these benefits is protected and remains,
to your final salary pension. for most members, age 65.
If you have been awarded extra If you retire and take all of your pension
membership by your employer and at your protected normal pension age,
the date your employer resolved to the pension built up in the scheme before
award this was before 1 April 2008, 1 April 2014 will be paid in full.
those years will attract a pension at the If you choose to take your pension before
rate of 1/80th of your final pay for each your protected normal pension age, the
year of membership awarded, which pension you have built up in the scheme
will be added to your final salary pension, before 1 April 2014 will normally be
plus an automatic tax-free lump-sum of reduced, as it’s being paid earlier. If you
three times the pension. take it later than your protected normal
If you are a married man with pension age, it will be increased
membership before 1 April 1972, that because it’s being paid later. The amount
membership will be converted to 89% of of any reduction or increase will be based
its length unless you elected to pay extra on how many years earlier or later than
contributions to convert it to its full length. your protected normal pension age you
take the pension you have built up in the
If you are a high earner and you joined scheme to 31 March 2014.
the scheme after 31 May 1989 and
before 6 April 2006, you could only pay Benefits built up from 1 April 2014
contributions and have your benefits have a normal pension age linked to
based on your pay up to the earnings your state pension age (but with a
cap – this was £105,600 for 2005/6. minimum age of 65). For more details,
see the section Your Pension.
134
Please note that you cannot take your How are benefits worked out? above,
benefits built up to 31 March 2014 and are then reduced. How much your
separately from the benefits you build up benefits are reduced by depends on
from 1 April 2014. Your whole LGPS how early you take them.
pension must be taken at the same time
(except in the case of flexible retirement - The reduction is calculated in accordance
for more details, see the section Your with guidance issued by the Secretary of
Pension). State from time to time. The reduction is
based on the length of time (in years and
What reductions are applied to my days) that you retire early – ie, the period
benefits built up before 1 April 2014 between the date your benefits are paid
if I draw them before my protected and your protected normal pension
normal pension age? age. The earlier you retire, the greater
the reduction.
If you choose to retire before your
protected normal pension age, your As a guide, the percentage reductions
benefits built up before 1 April 2014 (effective from 8 January 2019) for
will be reduced to take account of being retirements up to 13 years early are
paid for longer. Your benefits are initially shown in the table below.
calculated as detailed under the heading

0 0.0% 0.0%
1 5.1% 2.3%
2 9.9% 4.6%
3 14.3% 6.9%
4 18.4% 9.1%
5 22.2% 11.2%
6 25.7% 13.3%
7 29.0% 15.3%
8 32.1% 17.3%
9 35.0% 19.2%
10 37.7% 21.1%
11 41.6% N/A
12 44.0% N/A
13 46.3% N/A
135
*The maximum reduction that can be at the same time (except in the case of
applied to your automatic lump sum for flexible retirement. For more details, see
membership to 31 March 2008 is 10 the section Your Pension).
years as the protected normal pension
age for almost all members is 65, and the If you were a member of the LGPS at
earliest that virtually all members can any time between 1 April 1998 and
choose to take their pension is from age 30 September 2006, some or all of
55. your benefits paid early could be
protected from the reduction under
The number of years early used to what is called the 85-year rule.
determine the reduction applied to your
benefits built up before 1 April 2014 is If you have 85-year rule protection, this
the number of years earlier than your continues to apply from 1 April 2014.
protected normal pension age, which The only occasion where this protection
for most members is age 65. does not automatically apply is if you
choose to voluntarily take your pension
Your employer can agree not to make on or after age 55 and before age 60.
any reduction. You can ask them what
their policy on this is. The 85-year rule is satisfied if your
age at the date you draw your
You can reduce or avoid the reductions benefits and your scheme
by not taking immediate payment of your membership (each in whole years)
benefits on retirement, ie, by delaying add up to 85 or more.
payment until a later date. If you decide
not to take immediate benefits, the If you work part-time, your
benefits built up before 1 April 2014 membership counts towards the
would normally become payable ‘rule of 85’ at its full calendar
unreduced at your protected normal length.
pension age, which for most is age
65, and the benefits built up on or after Not all membership may count
1 April 2014 would normally become towards working out whether you
payable unreduced at your normal meet the 85-year rule.
pension age. You can defer payment
beyond that age, although benefits must Working out how you are affected by the
be paid by age 75. Remember you must 85-year rule can be quite complex, but
take all your pension (both pre-1 April this section should help you work out
2014 and post 31 March 2014 benefits) your general position.
136
• If you would not satisfy the 85-year If you take flexible retirement, any
rule by the time you are 65, then all 85-year rule protection will apply to the
your benefits are reduced if you benefits you’ve built up to the date of
choose to take your pension before flexible retirement but will not apply to
your normal pension age. benefits you build up after the date of
The reduction will be based on how flexible retirement.
many years before your normal
pension age (protected normal If you choose to voluntarily take your
pension age for pension built up pension on or after age 55 and before
before 1 April 2014 and new normal age 60 and you have ‘rule of 85’
pension age (linked to state pension protections, these will not automatically
age) for pension built up from 1 April apply. Your employer can choose to
2014) you take your benefits. allow the rule of 85 to apply in full. This
is a discretion and you can ask your
• If you reached age 60 before employer what their policy is on this
31 March 2016 and choose to take matter.
your pension before your normal
pension age, then, provided you If you choose voluntarily to take your
satisfy the 85-year rule when you pension on or after age 55 and before
start to take your pension, the age 60 and your employer does not
benefits you built up before 1 April choose to allow the rule of 85 to apply,
2016 will not be reduced. your benefits will be reduced.
• If you turned or will reach age 60 Please note that the operation of
by 31 March 2016 and choose to take protections under the 85 year rule
your pension before your protected is complex. If you are thinking of
normal pension age, then, provided voluntarily retiring or asking for flexible
you satisfy the 85-year rule when retirement before your normal pension
you start to take your pension, the age, you should contact the Fund for a
benefits you’ve built up to 31 March quotation of the benefits payable. If you
2008 will not be reduced. are thinking of asking for flexible
retirement you should firstly contact
Also, if you turned or will reach age 60 your employer to check what their
between 1 April 2016 and 31 March policy is for this type of retirement.
2020 and you meet the 85-year rule by
31 March 2020, the benefits you build Your employer can agree not to make
up in the main scheme between 1 April any reduction. You can ask them what
2008 and 31 March 2020 will not have their policy on this is.
a full reduction.
137
What increase is applied to my Ill-health retirement

benefits built up before 1 April 2014 if
I take them after age 65? You are not entitled to immediate
payment of ill health pension benefits
The benefits you have built up before if your ill-health retirement occurs after
1 April 2014 will be increased for each 31 March 2014 and you do not meet the
day after age 65 that you take them. two years’ vesting period. You will,
instead, be entitled to a refund of your
Remember that your pension has to be
contributions or a deferred benefit or,
paid by your 75th birthday. Your whole
provided you have at least three months’
LGPS pension benefits related to an
membership, you can transfer your
employment, if taken voluntarily, must
benefits to another pension scheme.
be drawn at the same time, irrespective
of whether they were built up in the If you were paying into the LGPS on
career average scheme or the final 31 March 2008, and were aged 45 or
salary scheme. over on that date and have been in
continuous membership of the LGPS,
Early retirement through redundancy then if you qualify for an ill-health pension
or business efficiency where your benefits are based on
enhanced membership there is protection
If you were a member of the LGPS
to ensure your ill-health retirement
before 1 April 2014 and are made
benefits are no less than they would have
redundant or leave for reasons of
been under the scheme as it applied
business efficiency after 1 April 2014,
before 1 April 2008. This protection
you must meet the two years’ vesting
would not apply if you have previously
period to be entitled to receive your
taken benefits on taking flexible
benefits immediately and without
retirement.
actuarial reduction. If you do not meet
the two years’ vesting period and are
made redundant after 31 March 2014 Additional protection if you are
you will be entitled to a refund of your nearing retirement
contributions or a deferred benefit or,
If you were a member of the scheme
provided you have at least three months’
before 1 April 2014, there are additional
membership, you can transfer your
protections in place if you are nearing
benefits to another pension scheme.
retirement. This is to ensure that you will
get a pension at least equal to that which
you would have received in the scheme
had it not changed on 1 April 2014. This
protection is known as the underpin.
138
The underpin applies to you if: • you haven't had a continuous break in
active membership of a public service
• you were an active member on pension scheme of more than five
31 March 2012 years (after 31 March 2012)
• you were within 10 years of your • you haven't taken any benefits in the
protected normal pension age on career average LGPS scheme before
1 April 2012 the date the underpin calculation is
• you haven’t had a continuous break in performed - this is the earlier of the
active membership of a public service date you leave the LGPS or age 65.
pension scheme of more than five The underpin will not apply to you if:
years (after 31 March 2012), and
• you leave without an immediate
• you've not taken any benefits in the entitlement to benefits,
LGPS before protected normal
pension age, and • you elect to opt out of the scheme
before your protected normal
The underpin can also apply if you were pension age, or
an active member of another public
service pension scheme on 31 March • you take your benefits from an age
2012 and you then join the LGPS and where you would have required
transfer your pension benefits from the employer consent to do so under the
other public service pension scheme into pre-1 April 2014 scheme, or
the career average LGPS scheme and all
or part of that transfer buys final salary • you leave the scheme with a deferred
benefits in the LGPS. The underpin will benefit and, at the date of leaving, you
apply in these circumstances if: would have required your employer's
consent to take payment of those
• there is a break of less than five years benefits under the pre-1 April 2014
between you leaving the public service scheme.
pension scheme from which the
transfer is received and joining the From 14 May 2018, you normally need
LGPS your employer's consent to take payment
of your benefits in the pre-1 April 2014
• you were within ten years of age 65 on scheme before age 55. Before 14 May
1 April 2012 2018, you needed your employer's
consent to take payment of your benefits
in the pre-1 April 2014 scheme before
age 60.
139
If you are covered by the underpin, a More information

calculation will be performed at the date
you cease to contribute to the Scheme, or For more information or if you have a
at your protected normal pension age if problem or question about your LGPS
earlier, to check that the pension you benefits, please contact the Fund. Contact
have built up (or, if you have been in the details can be found at the front of this
50/50 section of the scheme at any time, booklet.
the pension you would have built up had
you always been in the main section of
the scheme) is at least equal to that which
you would have received had the scheme You can find out about what you can do
not changed on 1 April 2014. If it isn’t, if you are not happy about a decision
the difference will be added into your made about your LGPS pension position
pension account when you draw your from the section Help with Pension
benefits. Problems.
The Fund will carry out this underpin
check if you meet the criteria above.
140
Some Terms We Use
Where pension terms are used, they administering authority with the
appear in bold italic type. Those terms assumed pensionable pay you
are defined in this section. would have received during that time
unless, during the period of relevant
Additional voluntary contributions child-related leave, the pensionable
(AVCs) pay received was higher than the value
These are extra payments to increase of the assumed pensionable pay. This
your future benefits. You can also pay requires a calculation to be carried out by
AVCs to provide additional life cover. your employer to determine what your
pay would have been for the relevant
All local government pension funds have period.
an AVC arrangement in which you can
invest money through an AVC provider, The assumed pensionable pay is
often an insurance company or building calculated as the average of the
society. AVCs are deducted directly from pensionable pay you received for the
your pay and attract tax relief. 12 weeks (or three months if monthly
paid) before the pay period in which
Admission body you went on to reduced pay or no pay
An admission body is an employer because of sickness or injury or before
that chooses to participate in the scheme you started a period of relevant child-
under an admission agreement. These related leave or reserve forces
tend to be employers such as charities service leave. In calculating the
and contractors. average, any reduction due to authorised
leave of absence or due to a trade
Assumed pensionable pay dispute is ignored. If the pay you receive
This provides a notional pensionable in the 12 weeks (or three months if
pay figure to ensure your pension is not monthly paid) before the pay period in
affected by any reduction in pensionable which you went on to reduced pay or no
pay due to a period of sickness or injury pay is materially lower than the pay you
on reduced contractual pay or no pay, would normally receive, your employer
or relevant child-related leave or has a discretion to use a higher pay in the
reserve forces service leave. calculation. Your employer must have
regard to the pensionable pay you
If you have a period of reduced earned over the previous 12 months
contractual or no pay due to sickness or when determining what your normal level
injury or you have a period of relevant of pensionable pay is. The resulting figure
child-related leave or reserve forces is then grossed up to an annual figure and
service leave, then your employer then divided by the period of time you
needs to provide the pension
141
were on reduced pay or no pay for reduced contractual hours because of

sickness or injury or on relevant the ill health which led to your retirement
child-related leave or reserve forces or death in service, the assumed
service leave. pensionable pay is to be calculated on
the pay you would have received during
Assumed pensionable pay is also used that period had you not been working
to work out any enhancement to your reduced contractual hours. The resulting
pension awarded as a result of ill-health figure is then grossed up to an annual
retirement, any lump-sum death grant figure.
following death in service, and any
enhancement which is included in Automatic enrolment date
survivor benefits following death in This is the earlier of:
service.
• the day you reach age 22 provided
The assumed pensionable pay for you are earning more than £10,000
these purposes is calculated as the (2019/20 figure) a year in the job, or
average of the pensionable pay you
received for the 12 weeks (or three • the beginning of the pay period in
months if monthly paid) before you died which you first earn more than £10,000
in service or before you left employment (2019/20 figure) in the job, on an
due to ill-health retirement. In calculating annualised basis, provided you are
the average, any reduction due to aged 22 or more and under state
authorised leave of absence or due to a pension age at that time.
trade dispute is ignored. If the pay you
receive in the 12 weeks (or three months Civil partnership
if monthly paid) before the pay period in A civil partnership is a relationship
which you went on to reduced pay or no between two people of the same sex
pay is materially lower than the pay you (civil partners) which is formed when
would normally receive, your employer they register as civil partners of each
has a discretion to use a higher pay in the other.
calculation. Your employer must have
regard to the pensionable pay you Club transfer rules
earned over the previous 12 months Club transfer rules allow certain
when determining what your normal occupational pension schemes,
level of pensionable pay is. Also, where mainly public service pension
an independent registered medical schemes, to calculate transfers on a
practitioner certifies that, during the special terms. Transfers into the LGPS,
period used to determine assumed including final salary membership from
pensionable pay, you were working other public sector club transfer schemes
142
(usually membership up to 31 March Consumer prices index (CPI)

2015), or transfers out of the LGPS to The consumer prices index (CPI) is the
other public sector club schemes official measure of inflation of consumer
(including final salary membership built prices in the United Kingdom. This is
up before 1 April 2014), provide benefits currently the measure used to adjust your
that are broadly equivalent across both pension account at the end of every
schemes. Provided there is not a scheme year when you are an active
continuous break in active membership member of the scheme and, after you
of a public service pension scheme have ceased to be an active member, it is
of more than five years, any final salary used to increase (each April) the value of
membership transferred would purchase your deferred pension in the scheme and
a period of membership and retain a final any pension in payment from the
salary link. The Fund will provide you scheme. The adjustment ensures the
with further information on club transfers value of your pension keeps up with the
should this apply to you. cost of living.
Contracted out Designating body

The LGPS was formerly contracted out of Designating bodies are bodies which can
the state earning-related pension designate employees for access to the
scheme (SERPS) and the state second scheme. Employees of town and parish
pension (S2P). This meant that, up until councils, voluntary schools, foundation
5 April 2016, prior to state pension age schools, foundation special schools,
you paid reduced national insurance federated schools, technical institutes,
contributions between certain thresholds Transport for London, and the Children
(unless you had opted to pay the married and Family Court Advisory and Support
woman’s/widow’s reduced rate of Service, among others, can be
national insurance). The LGPS guarantees designated for membership of the
to pay you a guaranteed minimum scheme.
pension (GMP) for being contracted out
of the state earning-related pension Discretion
scheme (SERPS). This is the power given by the LGPS
to enable your employer or your
From 6 April 2016, the ‘contracted-out’ administering authority to choose how
status ceased to exist for all pension they will apply the scheme in respect of
schemes due to the introduction of the certain provisions. Under the LGPS your
new single tier state pension. Therefore, employer or your administering authority
from 6 April 2016, members of the are obliged to consider how to exercise
LGPS pay the standard rate of national their discretion and, in respect of some
insurance.
143
(but not all) of these discretionary • be unable to engage in gainful

provisions, to have a written policy on employment because of physical or
how they will apply their discretion. mental impairment and either:
They have a responsibility to act with
‘prudence and propriety’ in formulating - has not reached the age of 23, or
their policies and must keep them under - the impairment is, in the opinion
review. You may ask your employer or of an independent registered
your administering authority what their medical practitioner, likely to be
policy is in relation to a discretion. permanent and the child was
Your administering authority is the City dependent on you at the date of
of Wolverhampton Council. your death because of that mental
or physical impairment.
Eligible children
Eligible children are your children. Eligible cohabiting partner
They must, at the date of your death: An eligible cohabiting partner is a
partner you are living with who, at the
• be your natural child (who must be
born within 12 months of your death), date of your death, has met all of the
or following conditions for a continuous
period of at least two years:
• be your adopted child, or
• you and your cohabiting partner are,
• be your step-child or a child accepted and have been, free to marry each
by you as being a member of your other or enter into a civil partnership
family (this doesn’t include a child you with each other, and
sponsor for charity) and be dependent
on you. • you and your cohabiting partner have
been living together as if you were a
Eligible children must meet the married couple, or civil partners, and
following conditions:
• neither you or your cohabiting partner
• be under age 18, or have been living with someone else as
if you/they were a married couple or
• be aged 18 or over and under 23 and civil partners, and
in full-time education or vocational
training (although your administering • either your cohabiting partner is, and
authority can continue to treat the child has been, financially dependent on you
as an eligible child notwithstanding a or you are, and have been, financially
break in full-time education or interdependent on each other.
vocational training), or
144
Your partner is financially dependent on Final pay

you if you have the highest income. This is usually the pay in respect of
Financially interdependent means that (ie, due for) your final year of scheme
you rely on your joint finances to support membership on which you paid
your standard of living. It doesn’t mean contributions, or one of the previous
that you need to be contributing equally. two years if this is higher, and includes
For example, if your partner’s income is a your normal pay, contractual shift
lot more than yours, he or she may pay allowance, bonus, contractual overtime
the mortgage and most of the bills, and (but not non-contractual overtime),
you may pay for the weekly shopping. maternity pay, paternity pay, adoption
pay, Shared parental pay and any other
On your death, a survivor’s pension taxable benefit specified in your contract
would be paid to your cohabiting partner as being pensionable.
if:
If you were part-time for all or part of the
• all of the above criteria apply at the final year, the whole-time pay that you
date of your death, and would have received if you had worked
• your cohabiting partner satisfies your whole-time is used and if your pay in
administering authority that the above your final year was reduced because of
conditions had been met for a sickness or relevant child-related
continuous period of at least two years leave, final pay is the pay you would
immediately prior to your death. have received had you not been on sick
leave or relevant child-related leave.
You are not required to complete a form
to nominate a cohabiting partner for For more information on the calculation
entitlement to a cohabiting partner’s of final pay, please see the section If You
pension. However, you can provide the Joined the LGPS Before 1 April 2014.
Fund with your cohabiting partner’s
details. The Fund will require evidence Guaranteed minimum pension (GMP)
upon your death to check that the The LGPS guarantees to pay you a
conditions for a cohabiting partner's pension that is at least as high as you
pension are met. would have earned had you not been
contracted out of the state earning-
Eligible jobholder related pension scheme (SERPS) at
An eligible jobholder is a worker who any time between 6 April 1978 and 5
is aged at least 22 and under state April 1997. This is called the guaranteed
pension age and who earns more than minimum pension (GMP).
the annual amount of £10,000 (2019/20
figure).
145
Local government normal pension age of the LGPS

The term local government in this pension that is in payment.
booklet also covers police and fire civilian
staff, a coroner, civil servants engaged If you were paying into the LGPS before
in probation provision, a mayoral 1 April 2014 your final salary benefits
development corporation, a conservation retain their protected normal pension
board, a valuation tribunal, a passenger age - which for most is age 65. However,
transport authority, the Environment all pension benefits taken on normal
Agency, and non-teaching employees retirement must be taken at the same
of an academy employer, an education date ie you cannot separately take your
action Forum, a sixth-form college final salary benefits (built up before April
corporation or a further or higher 2014) at age 65 and your benefits in your
education corporation. pension account (built up from April
2014) at your normal pension age
Normal pension age (which for your benefits built up from
Normal pension age is linked to your April 2014 is linked to your state
state pension age for benefits built up pension age but with a minimum of
from April 2014 (but with a minimum of age 65). See the section When can I
age 65) and is the age at which you can retire and take my LGPS benefits?
take the pension you have built up in full.
If you choose to take your pension before Occupational pension scheme
your normal pension age, it will These schemes are also called company
normally be reduced, as it's being pension schemes. It's a scheme set up
paid earlier. If you take it later than your by an employer to provide pension or
normal pension age, it's increased death benefits for its employees. An
because it's being paid later. occupational pension can provide pension
benefits on a money purchase, defined
You can use the Government’s benefits, cash balance or hybrid
state pension age calculator at arrangement basis.
www.gov.uk/calculate-state-pension
to find out your state pension age. The two most common arrangements
for occupational schemes are defined
Remember that your state pension age benefits (such as the LGPS) and money
may change in the future, and this would purchase.
also change your normal pension age
in the LGPS for benefits built up from If you leave a job you'll normally have to
April 2014. Once you start receiving your stop building up pension savings in that
pension any subsequent change to your employer's scheme. These benefits can
state pension age will not affect the be transferred to your pension in the
146
LGPS. Any transfer into the LGPS would Your account is then revalued to take
buy extra pension which is then added to account of the cost of living. This
your pension account, unless the transfer adjustment is carried out in line with the
is from a public service pension scheme Treasury Revaluation Order index which,
and is transferred under the Club currently, is the rate of the consumer
transfer rules in which case any part prices index (CPI).
of the transfer that relates to final salary
benefits in that scheme (usually You will have a separate pension
membership up to 31 March 2015) account for each employment. That
would buy pre-1 April 2014 membership pension account will hold the entire
in the final salary scheme. pension built-up for that employment.
Pension account In addition to an active member’s pension

Each scheme year the amount of account there are also:
pension you have built up during the • a deferred member’s pension
year is worked out and this amount is account;
added to your active pension account.
Adjustments may be made to your • a deferred refund account;
account during the scheme year to
take account of: • a retirement pension account;
• any transfer of pension rights into the • a flexible retirement pension account;
account during the year • a deferred pensioner member’s
account;
• any additional pension you may have
decided to purchase during the year • a pension credit account; and
• any additional pension which is granted • a survivor member’s account.
to you by your employer during the
year These accounts will be adjusted by any
debits for any pension sharing order or
• any reduction due to a pension sharing qualifying agreement in Scotland
order or qualifying agreement in (following a divorce or dissolution of a
Scotland (following a divorce or civil partnership) and for any annual
dissolution of a civil partnership) and allowance tax charge that you have
asked the scheme to pay on your behalf.
• any reduction due to an annual These accounts are currently increased
allowance tax charge that you have
each April in line with the consumer
asked the scheme to pay on your
prices index (CPI).
behalf.
147
Pensionable pay Public service pension scheme

The pay on which you normally pay A public service pension scheme
contributions is your normal salary or includes a pension scheme covering
wages plus any shift allowance, civil servants, the judiciary, the armed
bonuses, overtime (both contractual forces, any scheme in England, Wales
and non-contractual), maternity pay, or Scotland covering local government
paternity pay, adoption pay, shared workers, or teachers, or health service
parental pay and any other taxable workers, or fire and rescue workers or
benefit specified in your contract as members of the police forces, or
being pensionable. membership of a new public body
pension scheme.
You do not pay contributions on:
• any travelling or subsistence Relevant child-related leave

allowances Relevant child-related leave includes
periods of ordinary maternity, adoption or
• pay in lieu of notice shared parental leave (normally first 26
weeks), paternity leave and any periods
• pay in lieu of loss of holidays of paid additional maternity or adoption
• any payment as an inducement not to leave (normally after week 26 weeks up
leave before the payment is made week 39) or shared parental leave.
• any award of compensation (other Reserve forces service leave

than payment representing arrears This occurs when a reservist is mobilised
of pay) made for the purpose of and called upon to take part in military
achieving equal pay operations. The period of mobilisation
can be up to a maximum of 12 months.
• pay relating to loss of future The period of mobilisation can range
pensionable payments or benefits from three months or less and up to a
• any pay paid by your employer if maximum of 12 months. During a period
you go on reserve forces service of reserve forces service leave you
leave, nor will, if you elect to stay in the LGPS
during that leave, continue to build up a
• the monetary value of a car or pay pension based on the rate of assumed
received in lieu of a car (apart from pensionable pay you would have
some historical cases). received had you not been on reserve
forces service leave.
148
Scheme year state second pension (S2P) from

The scheme year runs from 1 April to 6 April 2002 which, in turn, was replaced
31 March each year. by the single tier state pension from
6 April 2016.
SERPS (state earnings-related
pension scheme) State pension age
This is the extra earnings related part of This is the earliest age you can receive
the state pension that employed people the basic state pension. State pension
could earn up to 5 April 2002. LGPS age for women was increased between
members were automatically contracted 2010 and December 2018 to be equalised
out of SERPS, and most paid lower with the state pension age of 65 that
national insurance contributions as a applied to men up to December 2018.
result. SERPS was replaced by the
State pension age equalisation timetable for women

Before 6 April 1950 60
6 April 1953 - 5 August 1953 In the range 63 - 64
6 August 1953 - 5 December 1953 In the range 64 - 65
The state pension age increases to 66 for both men and women between December
2018 and October 2020.
Increase in state pension age from 65 to 66 for men and women
6 December 1953 - 5 October 1954 In the range 65 - 66
After 5 October 1954 66
Under current legislation, the state pension age is due to rise to 67 between 2026
and 2028 and to 68 between 2044 and 2046. However, the government has an-
nounced plans to bring forward the rise to 68 to between 2037 and 2039.
To find out your state pension age, please visit www.gov.uk/calculate-state-pension
149
State second pension (S2P) • you have brought a transfer of pension

The state second pension (formerly rights into the LGPS in England or
SERPS) was the additional state pension, Wales from a pension scheme or
payable to individuals from state arrangement where you were not
pension age if they attained state allowed to receive a refund of
pension age before 6 April 2016. contributions, or
Initially, S2P was an earnings-related
pension but from April 2009 it began • you have previously transferred
building up as a flat rate pension until pension rights out of the LGPS in
6 April 2016 when it was replaced with England or Wales to a pension scheme
the single tier state pension. abroad (ie, to a qualifying recognised
overseas pension scheme), or
The Government introduced a new
single-tier state pension from 6 April • you already hold a deferred benefit or
2016. For information about the new are receiving a pension from the LGPS
state pension, see in England or Wales (other than a
www.gov.uk/new-state-pension survivor's pension or pension credit
member's pension), or
Vesting Period • you paid national insurance
The vesting period in the LGPS is two contributions while a member of the
years. You will meet the two years’ LGPS and cease to contribute to the
vesting period if: LGPS in the tax year of attaining
pension age,
• you have been a member of the
LGPS in England and Wales for two • you cease to contribute to the LGPS
years, or at age 75, or
• you have brought a transfer of pension • you die in service.
rights into the LGPS in England or
Wales from a different occupational
pension scheme or from a European
pensions institution and the length of
service you had in that scheme or
institution was two or more years or,
when added to the period of time you
have been a member of the LGPS is, in
aggregate, two or more years, or
150
Contact Information
West Midlands Pension Fund

PO Box 3948
Wolverhampton
WV1 1XP
Email:
pensionfundenquiries@
wolverhampton.gov.uk
Customer Services:
0300 111 1665
Website:
wmpfonline.com

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