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Local Government Pension Scheme (LGPS) Hampshire Pension Fund Joining the Local Government Pension Scheme Starter information and membership option form Revised January 2013

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Page 1: Local Government Pension Scheme (LGPS) Hampshire Pension …documents.hants.gov.uk/pensions/LGPS-pension... · Local Government Pension Scheme (LGPS) Hampshire ... to do to join the

Local Government Pension Scheme

(LGPS)

Hampshire Pension Fund

Joining the Local Government Pension Scheme

Starter information and membership option form

Revised January 2013

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Joining the Local Government Pension Scheme

This booklet:

sets out what you need to do to join the Local Government Pension Scheme (LGPS) (page 3)

introduces the LGPS (page 5)

contains notes on completing the membership option form (page 6)

tells you about transferring previous LGPS service (pages 7-9)

includes Form A – a tear-off membership option form for completion (pages 9–10)

includes Form B – a form to transfer service at a later date (page 11).

What do I need to do?

Please read this booklet, including the information about how to complete the forms.

Complete and return Form A as soon as possible.

Complete Form B and return it to Pensions Services no later than 12 months after starting your new LGPS membership, unless you have already made a decision on Form A.

If you choose to combine any previous LGPS membership with that in your new membership, please send a clear photocopy of your passport or birth certificate. If your name differs from the one on your birth certificate or passport, send a document such as a marriage certificate or change of name deed to show why.

If you work for Hampshire County Council, please return your completed form to:

HCC employer team 232 EII Court South Hampshire County Council The Castle, Winchester Hampshire SO23 8UB

If you work for any other employer, please return your completed form to:

your personnel/administration or payroll officer

This booklet is for general use, so it cannot cover every personal circumstance. It does not give you any rights under contract or statute law. If there is any dispute over your pension benefits, the LGPS rules will apply. If you have any difficulty completing this form or need more information, please contact Pensions Services on 01962 845588, email [email protected] or visit our website at www.hants.gov.uk/pensions.

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Introduction to the Local Government Pension Scheme What is the Local Government Pension Scheme?

The Local Government Pension Scheme (LGPS) is a statutory, defined benefit, final salary pension scheme. This means it is secure because its benefits are set out in law and guaranteed.

The LGPS is contracted out of the additional state pension (S2P). It must, in general, provide benefits at least as good as most members would have received had they been paying into S2P.

Who can join?

The LGPS is open to most employees in local government and other organisations who have chosen to participate.

You can join at any age up to two days before your 75th birthday.

You can carry on contributing towards other schemes such as a personal pension plan or stakeholder pension scheme.

What does it cost?

The costs of the scheme are met by employees and employers. To meet the cost of your pension benefits, your employer pays almost three times what you pay.

Your contribution rate will be between 5.5% and 7.5% of your pay and is determined by the full-time pay of your job. You do not pay tax on the portion of your pay you put into the pension scheme and you also pay lower NI contributions.

Benefits of the LGPS

The normal retirement age for all members of the LGPS is 65.

A guaranteed pension that will increase with the cost of living when in payment.

Choice to take part of your pension fund as a tax-free lump sum on retirement.

Early retirement – You can choose to retire from age 60 (or earlier with your employer’s consent) and receive your benefits immediately, although they may be reduced for early payment.

Ill-health retirement at any age - If you ever become permanently unable to do your job, you could receive immediate ill-health benefits.

Death benefits - A lump sum paid if you die before retirement age (and after retirement age if within guarantee period), and a pension for your widow/widower/civil partner/nominated co-habiting partner and for any eligible children.

What if I do not want to join?

Your employer may have to enrol you in the LGPS, but if you want to opt out after you start work you can complete an opt out form available from our website and return it to your payroll department who is responsible for opting you out of the scheme.

If you have been a member of the Hampshire Pension Fund for less than three months, and have not transferred in other pension benefits, then you may receive a refund of your contributions through your payroll.

If you were a member of the Hampshire Pension Fund for three months or more, or you have transferred in other pension benefits, then your LGPS benefits will be deferred until you either rejoin under the same employment, combine to a new membership, transfer them to another pension provider or retire.

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Completing Form A

If you are eligible for membership of the Hampshire Pension Fund in more than one employment, please complete a separate form for each one.

1. Personal details

This helps us to check we hold the correct details. Please write to us if your address, name

2. Partnership status

Please tell us your partnership status and the date from which it applied, for example when you married or entered into a civil partnership, or when your relationship formally ended.

3. Current employment

Tell us about the employment that this pension membership relates to, including your personnel or pay reference if you know it.

4. Previous LGPS membership

You can choose to combine previous LGPS membership with your new membership. It will not happen automatically.

Please list any previous LGPS membership that you have.

Put a tick next to any that you want to join with your new membership.

5. Election to combine previous LGPS membership

If you want to join some or all of your previous membership, tick the Yes option. Make sure you have put a tick by the membership you want to combine in section 3

If you do not want to combine any previous membership, tick the No option.

If you want to delay your decision, tick the Don’t know option.

If you choose to combine membership, please send a clear photocopy of your passport or birth certificate. If your name differs from the one on your birth certificate or passport, send a document such as a marriage certificate or change of name deed to show why.

You cannot combine two periods of LGPS membership if you still contribute to them both.

If you want to combine previous membership with your current membership, we must receive your decision within 12 months of the start of your current membership.

6. Purchase of extra years or extra pension

Please complete this section if:

you have previous membership that ceased less than a year ago which you have elected to combine with your new membership and

you had an added years contract

Please state whether or not you wish to continue your added years in your new membership. You can only do so if you complete this form within three months of starting the new membership. You must also pay arrears to cover the break in membership.

7. Receipt of LGPS pension

If you are starting a new employment in which you are eligible to pay into the Hampshire Pension Fund but you are currently in receipt of a pension then you need to tell the authority

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that pays your pension that you are employed and eligible to join the LGPS, even if you decide to opt out.

8. Declaration and authority

Please read the statement, then sign and date the form. We can only accept forms that are signed and dated on or after the date your employer enrolled you into the scheme.

Transfer of previous Local Government Pension Scheme Benefits Unless you elect to combine the benefits you built up in your previous membership(s) with those from your new membership, those earlier deferred benefits will remain separate.

Separate benefits

Benefits for your old LGPS membership are based on your final pay at the time it ceased, and benefits for current membership are based on final pay in your current employment

Combined benefits

Benefits are based on combined LGPS membership from both your old and current job and using the final pay from your current employment.

Whole-time equivalent pay

If the whole-time equivalent (WTE) pay in your current employment is less than in your previous employment and never equals or exceeds it, then your pension and any lump sum will be higher if you leave the membership separate.

If the WTE pay in your current employment is more than in your previous employment, or equals or exceeds it in time, your pension and lump sum will be higher if you combine the periods of membership.

To work out whether WTE pay in your current employment is more or less than in the old employment, you need to:

Consider whether it is likely to increase, for example through progression and promotions

increase your old pay by inflation so that you can compare current values

Pension increase figures are on the HM Treasury website. A link to their website is on our useful links web page: www.hants.gov.uk/pensions/pensionsusefullinks.htm

As well as checking that your current whole-time pay is higher or likely to be higher than your previous pay, you need to consider some other factors. The table overleaf outlines these:

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Factor Effect of keeping separate benefits

Effect of combining benefits

Qualifying membership

see Scheme Guide for details of 85 year rule, 25 year rule and ill-health retirement

Your old membership will not count towards:

achieving the 85 year rule

any benefit calculation including ill-health enhancements

in your new membership. If your old membership is protected by the 25 or 85 year rule, it will still be protected.

Your old membership will count towards:

achieving the 85 year rule

all benefit calculations including ill-health enhancements.

Death grant Separate death grants from each of your deferred benefits;-

If you left before 1 April 2008 death grant equal to the deferred benefit lump sum, or if you left after 31 March 2008 death grant five times pension plus

A death grant equal to three times contractual pay in your new membership.

Death grant equal to three times your contractual pay in your new membership.

Redundancy from age 55

If made redundant and entitled to immediate payment of your benefits, they will only be calculated on the service in your new membership. Your previous employer may agree to payment of your deferred benefits from age 55.

You will receive immediate payment of your benefits based on your combined membership in the LGPS.

Ill health retirement at any age

If you retire on ill health grounds and are entitled to immediate payment of your benefits, they will only be based on and calculated on the service in your new membership. Your previous employer may agree to early payment of your deferred benefits on ill health grounds.

You will receive immediate payment of your benefits based on your combined membership in the LGPS.

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Factor Effect of keeping separate benefits

Effect of combining benefits

Eligible retirement date

ERD the earliest date you can receive unreduced benefits

Deferred benefits will be payable without reduction from your ERD, which may be before but not later than age 65.

The ERD in your new membership will be calculated excluding service in your old membership and may be later than the ERD in that membership.

All benefits will be payable on the ERD relating to the new membership, after taking into account any 85 year rule protections.

This may be a later than would have applied to separate deferred benefits.

You should consider whether increased salary in the new membership compensates for a later ERD.

Added years contracts

If you had an added years contract in your old membership, it ceased when you left.

Added years ceased in 2008 so you cannot set up a new contract.

You can continue an added years contract if the gap between your old and new memberships is less than12 months, and you pay arrears for the gap within three months of re-joining.

Additional regular contributions (ARCs)

If you paid ARCs in your old membership, they ceased when you left.

A new contract can be set up in your new membership.

If you paid ARCs in your old membership, they ceased when you left.

A new contract can be set up in your new membership.

More information is available in a separate leaflet ‘Changing jobs within the LGPS’. You can download it from our website www.hants.gov.uk/pensions.

If you wish us to combine any previous LGPS membership with your new membership, then please either:

complete parts 4 & 5 of Form A

use Form B if you have already returned Form A. We must receive your decision within 12 months of you starting your new membership.

LGPS rules only allow you 12 months from the date of commencing the new membership to decide whether to combine benefits (unless your employer has a policy which allows an extended period).

If you do not make a decision within this time, the benefits must remain as separate deferred benefits and you will not have a further opportunity to combine them during this employment.

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FORM A Local Government Pension Scheme

Revised Jan 13 - 9 -

Hampshire Pension Fund - Membership option form

1. Personal details Please fill in this part in all cases.

Name Title

Address

Postcode

National insurance number

Date of birth

Email address Daytime telephone

2. Partnership status

Married / civil partner / nominated cohabiting partner

single / divorced / civil partnership dissolved

Date effective from:

3. Current employment Please complete as much information as known.

Name of employer

Post or job title

Start date Personnel/pay number

Hours per week Weeks per year

4. Previous LGPS membership

Do you have previous LGPS membership? Yes No

If yes, please give details of previous LGPS membership that you no longer contribute to and any other separate periods of LGPS membership that you have.

Please tick the Combine? box if you wish to combine the period of membership with your new membership or leave the box blank if you do not want to join it or you want to decide later.

Previous LGPS pension fund When you contributed Combine?

Date from: Date to:

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5. Election to combine previous LGPS membership Please tick one box

Do you elect to combine previous LGPS membership to your new membership?

(you cannot join two periods of membership if you are still paying contributions in both jobs)

Yes – I have indicated on the list above the previous membership that I elect to join to my new job and I have enclosed a copy of my birth certificate or passport with this form, and documents that show any changes of name

No - I wish to leave all my previous membership separate

I’ll decide later using Form B (and return it within 12 months of starting my new membership)

6. Purchase of additional pension benefits

Were you buying extra years in the LGPS? Yes No

If yes, and you have ticked yes in section 4 do you wish to continue to buy added years in your new membership?

(This option only applies if you have re-joined within 12 months of leaving and agree to pay back the break in contributions).

Yes No

Contract details (if known)

Start date End date

Rate paid To buy? (years)

7. Are you receiving an LGPS pension?

Yes No If yes, which fund pays it?

8. Declaration and authority The form will be returned if not signed or if it is dated before the start date of your new job.

The details in this form are correct to the best of my knowledge.

I confirm that I wish to become or remain a member of the LGPS.

I have read and understood the guidance notes on transferring previous LGPS benefits.

Where I have previous LGPS membership, I authorise my former fund to provide the Hampshire Pension Fund (HPF) with any relevant information.

If I have elected to transfer any of my previous LGPS membership to my new job, I ask the HPF to notify this to the other fund and I ask the other fund to treat this form as a formal election to combine membership.

Signed

Date ( cannot be earlier than the date you start your new job)

Hampshire County Council complies with the Data Protection Act 1998 and will use your data only for processing your pension rights.

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FORM B Local Government Pension Scheme

- 11 - Revised Jan 2013

Hampshire Pension Fund - Request for transfer of previous Local Government Pension Scheme benefits

Requests to combine previous Local Government Pension Scheme (LGPS) membership must be made within 12 months of starting your new membership.

1. Personal details

Name Title

Address

Postcode

National insurance number

Date of birth

Email address Daytime telephone

2. Previous Local Government Pension Scheme membership

Please give the details of any periods of LGPS membership (to which you are no longer paying contributions) that you want to combine with your new membership. Previous LGPS pension fund Dates contributed

3. Election to transfer previous LGPS benefits

I wish my previous LGPS benefits listed above to be transferred to my new membership with

(print new employer’s name)

4. Declaration and authority The form will be returned if not signed or if it is dated before the start date of your new job.

The details in this form are correct to the best of my knowledge. I have read and understood the guidance notes on transferring previous LGPS benefits.

Where I have previous LGPS membership, I authorise my former fund to provide the Hampshire Pension Fund (HPF) with any relevant information.

If I have elected to transfer my previous LGPS membership, I ask the HPF to notify this to the other fund and I ask the other fund to treat this as a formal election to combine membership.

I have enclosed a clear photocopy of my passport or of my birth and marriage certificates

Signed Date

Hampshire County Council complies with the Data Protection Act 1998 and will use your data only for processing your pension rights.

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