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NHS Pension Scheme Choice Exercise

NAME, GMB

LOCATION

DATE

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Why Have a NHS Pension?

Expectation to retire from work.• Hope to have a source of income to maintain

standard of living

• Life expectancies are increasing

State benefits alone will barely cover necessities

NHS Pensions benefit from tax breaks. Your employer pays towards your

pension.

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NHS Pension Scheme

NHSPS has two sections 1995 section (with a retirement age of 60)

available to all who were employed before 1 April 2008

2008 section (with a retirement age of 65) for new joiners or those returning after 5 years+

Both are final salary sections with different levels of benefit, but the same level of contributions payable

Scheme reviewed recently but under attack – opposition parties & media

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The Pensions Choice

Members have a one-off option to move all 1995 section pensionable service into 2008 section

All pension would be treated as if built up in 2008 section

For under 60’s (as at 1/10/2009) service would be converted on a year for year basis

For 60+ members, service would be reduced on transfer

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NHSPS – What you pay

Members pay same levels of contributions to both 1995 and 2008 sections

Your contribution rate is based on how much

earned in the last year Tier Full Time Equivalent Annual

Pensionable Pay in 2008/092009/10 Contribution

Rate

1 Up to £20,224 5%

2 £20,225 - £66,789 6.5%

3 £66,790 – £105,318 7.5%

4 £105,319 + 8.5%

Contributions are paid on your actual pensionable earnings

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1995 Section – Benefits

Normal Retirement Age of 60 Pension of 1/80th of final pay for

each year of service Automatic tax free lump sum of 3

times the pension (with the facility to give up a part of the pension for a higher lump sum)

Other features

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2008 Section – Benefits

Normal Retirement Age of 65 Pension of 1/60th of final pay for

each year of service No automatic tax free lump sum

(can give up a part of the pension for a lump sum)

Other features

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Delivery of the Choice Exercise

NHSPD delivering Choice Packs to employers Choice packs to include:

Statement Choice Guide DVD Form

Packs to be sent directly to members by employers

NHSPD are reliant on data sent by employer – very important to check

Intended to send these out from January 2010 4 months to make decision

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Choice - What You Should Think About

Nobody (including GMB) can tell you what Choice you should make

Individuals should consider: retirement age additional flexibilities available in 2008 Section

Is the Data on the Statement correct? – you should query anything that looks wrong

Do the projections provided tie in with your retirement plans?

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Resources

NHS Pensions Division www.nhsbsa.nhs.uk/Choice 0300 123 1601

State Pension – The Pensions Service www.thepensionservice.gov.uk 0845 6060265

GMB – Pensions Website www.gmb.org.uk/pensions Queries via rep/Regional Officer

Independent Financial Advice

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Questions?