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Warwickshire County Council Pension Fund AGM 2013 Neil Buxton Pension Services Manager

Warwickshire County Council Pension Fund AGM 2013 Neil Buxton Pension Services Manager. LGPS 2014. WHAT IS NOT CHANGING. Statutory Benefits are defined Tax – free contributions Tax free cash option at retirement Values protected by CPI Built in life cover / Ill Health Benefits

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Warwickshire County Council Pension Fund AGM 2013 Neil Buxton Pension Services Manager

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  1. Warwickshire County Council Pension Fund AGM 2013 Neil Buxton Pension Services Manager

  2. LGPS 2014

  3. WHAT IS NOT CHANGING Statutory Benefits are defined Tax – free contributions Tax free cash option at retirement Values protected by CPI Built in life cover / Ill Health Benefits Employer’s contributions Great value for money

  4. April 2014 – What’s New? Not ‘Final Salary’ but ‘Career Average’ New ‘Accrual’ rate All pay used to calculate pension Pension Accounts Protection against inflation Flexible membership terms – 50 / 50 New ‘Normal Retirement Age’

  5. How the main scheme will work • Pension = 1/49th of pay • Earnings = £24,500 • £24,500 / 49 = £500 • Which will go into the Pensions Account on 31 March • CPI = 3% • £15 (3% of £500) will also be added in April

  6. How the 50 / 50 scheme will work Pension = half of 1/49th of pay Earnings = £24,500 £24,500 / 49 = £500 £500 / 2 = £250 Which will go into the Pensions Account on 31 March CPI = 3% £7.50 (3% of £500) will also be added in April

  7. Your pension at retirement Your pensions account will contain: Any pension build up earnt by membership of the LGPS since April 2014 Any CPI rises Any previous LGPS service prior to 2014 Details of any tax free lump sum earnt prior to 2008 Any transfers into the LGPS

  8. What pension is now on offer? • 1/49th is better than 1/60th • £1 of pension for every £49 of pay

  9. Counting the Cost • Banded Rates • Majority of members will pay the same or less • Average contributions 6.5% • Contributions now based on all pay (including overtime)

  10. LGPS 2014 – The Cost

  11. LGPS 2014 – The Basic Benefits • Pension based on 1/49th of pay • Individual pension account • Price increases applied annually • Family / Dependents benefits • Ill health cover • Death in Service Benefits

  12. LGPS 2014 – Pension Payable When? • Flexible – between 55 – 75 • Redundancy and efficiency cover provided from 55 • Ill health cover – any age (subject to two years membership)

  13. Indication of Early Retirement Reduction

  14. What if I was in the scheme previously? • Membership up to 31 March 2008 • Annual Pension = 1/80 x Final Pensionable Pay x Membership • Tax Free Lump sum = 3 x Pension • Membership from 1 April 2008 • Annual Pension = 1/60x Final Pensionable Pay x Membership • No Automatic Tax Free Lump sum • Membership from 1 April 2014 • Annual Pension = 1/49 x Final Pensionable Pay for each year • No Automatic Tax Free Lump sum

  15. LGPS 2014 – Other Benefits • 50 / 50 option pay half – get half! But get full death in service and Ill health benefits

  16. Increasing my benefits • Increase benefits – APCs or AVCs • Two options combination of both or either single option, the choice is yours

  17. More information from: • Website: www.lgps2014.org • Includes videos on common topics • Treasury and Pensions – available for presentations / video presentation for team briefings

  18. Treasury and Pensions Pensions@warwickshire.gov.uk

  19. Only 2 Years and 105 days left

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