Pension Liberation Fraud is on the increase
Pension Liberation Fraud is a scam where savers are encouraged to transfer their pension fund to an arrangement on the promise of bogus ‘pension loans’ or cash incentives.
Tax charges of over half the value of your pension could fall on you for taking an ‘unauthorised payment’ from your pension fund in this way. Plus, high fees could be deducted from your pension for the transfer.
Fraud of this kind is on the rise in the UK, with people being targeted via unsolicited calls or text messages. To find out more read the Pension Regulator’s guidance or visit their website – http://www.thepensionsregulator.gov.uk/individuals/dangers-of-pension-scams.aspx
[Posted January 2016]
Government Consultation: Proposed £95,000 cap on employee redundancy and exit payments.
The Government has launched a consultation on proposals to introduce a cap on employee redundancy and other exit payments for Public Sector employees including pension strain costs related to early retirement where the employer is agreeing to pay for the member to receive unreduced pension benefits. The core proposals are:
- A cap of £95,000 on the total value of exit payments (before tax) to employees in the public sector.
- A cap covering all forms of exit payments including cash lump sums, the cost of early payment of pension benefits and other non-financial benefits such as additional paid leave.
- A cap applying to all types of arrangement including formal redundancy schemes, collective agreements and contractual arrangements.
The proposals exclude compensation payments in respect of death or injury, serious ill health and ill health retirements from any cap.
The consultation closes on 27 August 2015 and can be found here.
Summer Pension Update
We have issued our latest employer pensions news, a summer 2015 Pension Update, see below:
Prudential update AVC website
Prudential have made significant changes to their dedicated LGPS Additional Voluntary Contributions (AVCs) website.
These changes are based on member feedback and are part of an ongoing schedule of improvements.
The Prudential website now allows you to join or increase your AVC online. You can still call Prudential during office hours, but if you can’t, or would rather do it after hours, use the new online forms – www.pru.co.uk/rz/localgov/england-wales/
Remember that the value of your fund can go down as well as up and you may not get back the amount invested.
[Issued 4 August 2015]
Pensions Ombudsman rules on academy conversion
In one of the first cases to look at academy conversions, the Deputy Pensions Ombudsman has rejected a complaint by an academy against the administering authority of its LGPS fund. Subject being the funding methodology used to allocate assests to the Academy when it was initially set up.
Amendments to the Local Government Pension Scheme
Amendments to the Local Government Pension Scheme came into force on 11 April 2015. An overview to these changes and how they may affect you can be read on the Amendments to the Local Government Pension Scheme document.
[Issued 2 June 2015]
Freedom and Choice
From 6 April 2015 members of certain pension schemes will have more freedom over how to take the money from their pension.
This flexibility does not apply to a Defined Benefit scheme such as the Local Government Pension Scheme (LGPS), and will therefore not have a direct impact on your LGPS benefits.
However, it may affect you if you are not already in receipt of your LGPS benefits and are considering transferring them to a Defined Contribution scheme when, for example, you may need to obtain approved independent financial advice before transferring.
Should you wish to read more about how transferring to a Defined Contribution scheme may affect you please read the Q and A for members transferring from the LGPS to a Defined Contribution scheme.
[Issued 26 March 2015]
New 2015/16 contribution rates
The employee contribution bandings have been increased in line with the Consumer Prices Index at 30 September 2014 at a rate of 1.2% rounded down to the nearest £100.
Please note however that these new rates are subject to the Pension increase (Review) Order which is expected to be laid in March 2015.
[Issued 5 March 2015]
New Governance Arrangements for both the Cambridgeshire and Northamptonshire Pension Funds
In 2011, the Government accepted the recommendation made by Lord Hutton and the Independent Public Services Pensions Commission that all public services pension schemes should have a board that is properly constituted and is responsible for meeting good standards of governance including effective and efficient administration.
The Public Services Pensions Act 2013 captured this recommendation and as a result every public service pension scheme must establish a local pension board. Go to links above or “Governance – Latest news” to find out what the County Council and LGSS Pensions Service are doing to provide this extra layer of oversight. [Issued 16 January 2015]
Cost Control in the LGPS
The Shadow Scheme Advisory Board has published a briefing note, for both MEMBERS and EMPLOYERS, in respect of the cost control processes which will be used to assess the costs of the reformed LGPS in England & Wales. The Cost Control Briefing Note:
- gives a broad overview of the background to the cost control processes,
- outlines the differences between the cost control processes and local funding valuations, and
- details the possible impacts on the benefits structure and/ or employee contribution rates which could arise from the results of the cost control processes.
These cost control mechanisms will be undertaken every three years, from 2016.
[Issued 24 December 2014]
Consultation: Joint Administration Strategy
A 30 day consultation has been launched to seek the views of all Pension Fund stakeholders on proposed amendments to our Joint Administration Strategy. These amendments will bring the Administration Strategy in line with the Local Government Pension Scheme Regulations 2013. The consultation will close on Wednesday 14th January 2015. Please send any comments on the draft strategy to firstname.lastname@example.org.
Additional Pension Contributions – Guidance for Employers
National guidance has now been published detailing the provisions in LGPS 2014 for the purchase of additional pension through Additional Pension Contributions (APCs). This guidance includes the provisions relating to the purchase of “lost” pension as a result of an absence. Note that an online modeller to assist with the APC process will be made available shortly.
Please read this guidance carefully to understand your responsibilities as an employer under LGPS 2014. EXCEPT FOR APC CONTRACTS TO RECOVER LOST PENSION, LGSS Pensions confirm that the Cambridgeshire and Northamptonshire Pension Funds will require a medical check for regular contribution AND lump sum APC contracts. This is similar to the current requirement for ARC contracts. For clarity, no medical check is required for APC contracts to recover lost pension.
Furthermore, LGSS Pensions confirms that we will not be directing employers on any minimum monthly payment required for entering into an APC contract (most relevant to contracts for lost pension).
The paper refers to Secretary of State guidance “Purchase of additional pension – Elections on or after 1 April 2014”, which can be found at the following link. [Posted April 2014]
- The new look pension scheme has arrived and from 1 April 2014 your pension is now built up in a new way, to find out more about this and the flexibility of the new scheme please see The Local Government Pension Scheme 2014 website. Our Forms and Resources pages have all been updated to reflect the changes. Please visit Frequently Asked Questions for further clarification. [Posted 1 April 2014]
- Our latest newsletter LGPS 2014 Employee Newsletter. [Posted 20 January 2014]
- The first of a suite of leaflets on the changes being introduced from April 2014 have been released by the Local Government Association – Scheme changes, Member contributions and the flexibility to pay more or less, How is my pension worked out, When can I take my pension and Mythbusting LGPS 2014. [Posted 19 November 2013]
- The LGPS 2014 scheme member website www.lgps2014.org has been relaunched with a new look developed in line with the updated content and information. The content reflects, where possible, regulations which have been agreed for LGPS 2014. Here you will also find 3 new short topic videos giving more information on the cost of the Scheme as well as how pensions in the career average scheme are calculated and when they are payable. [Posted 19 November 2013]
- The new scheme regulations for the LGPS 2014 were released on the 19 September 2013. These will come into force on the 1 April 2014, however we understand that minor amendments may be made to the regulations between now and then. A copy of the Regulations, along with related Explanatory Memorandum and Impact Assessment can be found on the government’s legislation website. Our Regulation Specialists will now be working to provide scheme guidance and we will be communicating with both our members and employers in due course. [Posted 20 September 2013]
- A scheme member leaflet, entitled ‘The LGPS is changing from 1 April 2014′ has been developed and is the first in a suite of leaflets planned to launch LGPS 2014. Details of further communications can be viewed on the draft communication plan for the LGPS 2014. [Posted 5 July 2013]
- A third consultation on the draft Regulations for the 2014 Scheme was announced on the 20 June 2013. The consultation closed on the 2 August 2013 and the document can be found on the Government website. [Originally posted 28 June 2013]
- The first of a series of short videos on the LGPS 2014 is now available on the LGPS 2014 website. This is a short lively graphics based video with music and is intended to introduce you to the high level changes being made to the LGPS from next April.
Consultation on the future of the LGPS
- New Governance arrangements: a discussion paper was launched on the 20 June 2013, inviting comments that would inform the drafting of Regulations concerning new governance arrangements for the LGPS. The consultation closes on the 30 August 2013 and the paper can be found on the Government website. [Posted 28 June 2013]
- Call for evidence on the future structure of the Local Government Pension Scheme (LGPS): on the 21 June 2013 the Government launched a call for evidence that would improve the efficiency and cost-effectiveness of the LGPS. The consultation closes on the 27 September and the document can be found on the Government website.
- This is part of a series of consultations on the future of the LGPS, and the documents for both this and the earlier closed consultations are gathered together on the Government website. [Posted 28 June 2013]
- On 1 May 2014 the Government launched a consultation in response to the earlier call for evidence into the future structure of the LGPS. The consultation sets out how the Scheme could achieve significant savings and seeks views on the proposals. The consultation closes on the 11 July 2014. The consultation document and details of how to respond can be found on the government website.
2014 Annual Benefit Statements for our Active Members
If you are currently an active member of the Scheme and were prior to 1 April 2014 you should be receiving your Annual Benefit Statement (ABS) 2014 this week, for membership up to 31 March 2014. More can be read on our ABS pages. At this busy time, should you have a query regarding your ABS we ask that you do not call in but first view our ABS FAQ page. If you do not find the answer to your query here we would appreciate if you then contact us by email or post. Contact details can be found on the Checking Your ABS page.
Administering Authority Discretions
Following the introduction of LGPS 2014 on the 1 April 2014, there was a need to review existing, and implement new policies on the exercise of the Administering Authorities discretions under a range of legislation.
Both Administering Authorities for the Cambridgeshire and Northamptonshire funds have now agreed and published their policies. Both policy documents can be found on each funds Governance page on this website.
The discretions policy for the Northamptonshire Pension Fund was agreed by the Board on and became effective from 23 June 2014
The discretions policy for the Cambridgeshire Pension Fund was agreed by the Board on and became effective from 26 June 2014
Information for Employers regarding the proposed strike day.
Information from the Local Government Association concerning the proposed strike is set out in their latest circular: Circular 283 – strike.
Additional Voluntary Contributions (AVC) - Budget 2014 update from Prudential
Prudential have provided an update explaining the changes to the way in which members can access their AVC retirement savings following the governments announcements in the 2014 Budget. You can find out how these changes might affect you, if you have an AVC Fund by reading this newsletter.
Pensions Service Consultation
LGSS Pensions have launched a consultation regarding the closure of our Cambridge office. More detail can be found in the LGSS Pensions Service Consultation Document. The consultation will close on 14 May 2014. Please send any responses to email@example.com with Consultation as the subject heading.
The consultation is now closed. The Response to consultation April 14 is the final and consolidated response.
Councillors’ Pensions Update
Further to the written ministerial statement to Parliament on the 19 December 2012 regarding Councillors’ access to membership of the LGPS from the 1 April 2014 onwards, the formal consultation on this matter has now closed.
The Government’s preferred option is still for Councillors not to have access to membership of the LGPS from the 1 April 2014, although a further two alternative options were put forward for consultation in the consultation document.
The Local Government Association (LGA) has now released its response to the Councillor’s consultation supporting continued access to the LGPS for all Councillors. More can be read on the LGA’s response to Councillor Pensions consultation. [Posted 15 July 2013]
Do you, or did you have a with-profits policy with Equitable Life?
The Equitable Life Payment Scheme was set up by the Government to make payments to Equitable Life policyholders who suffered a financial loss as a result of the Government maladministration in the regulation of Equitable Life.
Since its launch in July 2011 payments have been made to eligible individual policyholders. However, the Scheme is now contacting those eligible for compensation in a Group Scheme, such as the Local Government Pension Scheme Additional Voluntary Contribution (AVC) arrangement that was available to members of the Cambridgeshire Pension Fund.
If you are affected, the Equitable Life Payment Scheme should contact you directly, however as the Payment Scheme will close in 2014 you may wish to call the Payment Scheme on 0300 0200 150 if you have not been contacted by the end of October 2013. Alternatively you can read more on the Equitable Life Payment Scheme website.
Lifetime Allowance Reduction for scheme members
The lifetime allowance is the amount of savings you can take from your pension schemes without facing a charge. From 6 April 2016 these allowances are changing. Please see the message below for more guidance.
Reductions in Pensionable Pay
Our latest factsheet, for those members who have had a reduction or restriction in their pensionable pay, for reasons other than a change in hours worked, or the end of a temporary increase, can be found on our Forms and Resources page [November 2015]