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Presentation for USS members Colin Busby and Eifion Morris APMI. Changes to USS. - PowerPoint PPT Presentation
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Changes to USS
Every effort has been made to present accurate information. Members are advised to check with their employer and/or the USS guides to confirm their understanding before acting on any information given. This presentation may be recorded for training and audit purposes.
Presentation for USS membersColin Busby and Eifion Morris APMI
Change
• The review of USS
• Changes affecting current members
• Changes affecting new joiners
• Tax relief allowances from 2011
• Your questions
The Review of USS
Review of USS
Changes affecting current members – Final salary section
Changes affecting current members
1 October 2011
Higher Normal Pension Age (NPA)
Normal Pension Age (NPA)65Example –retiring at 60 with employer consent
Age at 30 September 2011 50Service to 30 September 2011 20 yearsService since I October 2011 10 yearsPensionable salary £45,000.00
I’m buying extra service to retire at 60
Change to redundancy terms
Normal Pension Age to be linked to rise in State Pension Ages
Future increases to NPA - 66
April 2020 NPA increases to 66
Contribution increase to 7.5%
Salary (pa) Cost from take-home pay at 6.35% (per month)
Cost from take-home pay at 7.5% (per month)
Impact on take home pay each month
£10,000 £36.00 £43.60 - £ 7.60£15,000 £50.00 £61.80 - £11.80£30,000 £94.00 £116.80 - £22.80£45,000 £139.00 £173.60 - £34.60£60,000* £190.50 £225.00 - £34.50 £75,000* £238.00 £281.00 - £43.00
* 40% tax relief applied
Pension increases change
Pension increase change
Increases to official pensions USS increase
5% pa or less Increases matched
More than 5% pa but less than 15% pa 5% plus 50% of increases above 5%
More than 15% pa Overall ceiling of 10% pa
Deferred pension increases
Flexible retirement
Flexible retirement – early payment reductions
Other changes
What stays the same?
Changes affecting new entrants from 1 October 2011
Who joins new section?
How does Career Revalued Benefits work?
Cost sharing
Cost sharing
Tax relief allowances from April 2011
Tax relief – pre April 2011
Tax relief changes – April 2011
Salary at start of year
Salary at end of year (5% increase)
Pension and lump sum accrual (19:1)
10 years 20 years 30 years 40 years
£50,000 £52,500 £14,499 £16,756 £19,012 £21,268
£60,000 £63,000 £17,399 £20,107 £22,814 £25,522
£70,000 £73,500 £20,299 £23,458 £26,617 £29,775
£80,000 £84,000 £23,199 £26,809 £30,419 £34,029
£90,000 £94,500 £26,099 £30,160 £34,221 £38,283
£100,000 £105,000 £28,999 £33,511 £38,024 £42,536
£110,000 £115,500 £31,899 £36,862 £41,826 £46,790
£120,000 £126,000 £34,799 £40,214 £45,629 £51,044
£130,000 £136,500 £37,698 £43,565 £49,431 £55,297
£140,000 £147,000 £40,598 £46,916 £53,233 £59,551
£150,000 £157,500 £43,498 £50,267 £57,036 £63,804
£160,000 £168,000 £46,398 £53,618 £60,838 £68,058
£170,000 £178,500 £49,298 £56,969 £64,640 £72,312
£180,000 £189,000 £52,198 £60,320 £68,443 £76,565
£190,000 £199,500 £55,098 £63,671 £72,245 £80,819
£200,000 £210,000 £57,998 £67,023 £76,048 £85,073
£250,000 £262,500 £72,497 £83,778 £95,059 £106,341
Salary at start of year
Salary at end of year (10% increase)
Pension and lump sum accrual (19:1)
10 years 20 years 30 years 40 years
£50,000 £55,000 £20,437 £28,631 £36,824 £45,018
£60,000 £66,000 £24,524 £34,357 £44,189 £54,022
£70,000 £77,000 £28,612 £40,083 £51,554 £63,025
£80,000 £88,000 £32,699 £45,809 £58,919 £72,029
£90,000 £99,000 £36,786 £51,535 £66,284 £81,033
£100,000 £110,000 £40,874 £57,261 £73,649 £90,036
£110,000 £121,000 £44,961 £62,987 £81,014 £99,040
£120,000 £132,000 £49,049 £68,714 £88,379 £108,044
£130,000 £143,000 £53,136 £74,440 £95,743 £117,047
£140,000 £154,000 £57,223 £80,166 £103,108 £126,051
£150,000 £165,000 £61,311 £85,892 £110,473 £135,054
£160,000 £176,000 £65,398 £91,618 £117,838 £144,058
£170,000 £187,000 £69,485 £97,344 £125,203 £153,062
£180,000 £198,000 £73,573 £103,070 £132,568 £162,065
£190,000 £209,000 £77,660 £108,796 £139,933 £171,069
£200,000 £220,000 £81,748 £114,523 £147,298 £180,073
£250,000 £275,000 £102,184 £143,153 £184,122 £225,091
Salary at start of year
Salary at end of year (Promotion)
Pension and lump sum accrual (19:1)
10 years 20 years 30 years 40 years
£15,000 £20,000 £14,444 £25,214 £35,985 £46,755
£20,000 £30,000 £27,175 £49,452 £71,730 £94,007
£36,000 £45,000 £27,540 £46,264 £64,989 £83,713
£100,000 £250,000 £373,374 £722,261 £1,071,149 £1,420,036
AVC options for Final Salary members
AVC Options
AVCs and the Annual Allowance
How to pay AVCs – Added Years
Summary of changes
More information
• Pensions office contacts
• USS website – www.uss.co.uk
• Prudential – www.pru.co.uk/uss– 0800 515914