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Police Mutual

Pension Reform

Latest Information

Pensions Legal Challenge - 19/10/15

The Legal Challenge - an update by Steve Trigg, Chair, SWPF: There can be few officers affected by the changes to the CARE Pension scheme who have not been concerned that they have been subject to this change without prior consultation and, for most, contrary to their wishes.

The Police Federation of England and Wales has published an FAQ document and circulated their view that following legal advice there is no credible avenue to pursue a legal challenge against those changes.

As a result, a group of officers from GMP has organised their own challenge in conjunction with a London based law firm, Leigh Day.

On Monday 12th October, 2015 I travelled to London for a presentation from their QC, Keith Bryant, and the following is a summary of that meeting.

Please click to read more.....

Advice on the CARE Pension Scheme - 24/9/15

The PFEW has now circulated the attached document to try to answer some of the queries on the legal challenge being proposed against the CARE Pension Scheme. It reiterates that the PFEW will not fund a challenge at this time and, importantly, highlights some of the caveats you need to consider if wondering on which course of action you should take.

Read the document here....


If you're viewing this from a non-police computer you can now see a podcast by the National PFEW General Secretary on frequent questions asked about the current pension issues. Click here to view the podcast


This is the Government's equality impact assessment published 01/09/2015

This is the FAQ on the latest legal position dated 11/8/2015

New Information on the Purchase of Added Pension - read the Police Pension Scheme 2015 - Purchase of Added Pension first

You can download the full regulations for the 2015 CARE Scheme here

You can now download the 2015 Member Guide to the new CARE Pension Scheme

You can also download the PFEW FAQ on the CARE Scheme here - This is the amended version of the FAQ which takes account of member queries and seeks to answer them

This is the administrator's Guide to the 2015 scheme and includes a table on tapering protection

You can view a powerpoint on the new scheme here

Police Pension Scheme 2015 – the legal position (Dated 7/8/15)

Throughout the pension reform process PFEW has listened to the views and concerns of members and the Pension Challenge group, and we have taken advice from our lawyers and from leading counsel about the legality of the Government’s changes. We have recently taken further advice from leading counsel as to whether the position has changed or is affected by the publication of the Police Pensions Regulations 2015.

All possible challenges have been considered including:

• public law (judicial review: but being primary legislation, this is not subject to this);
• European law and Human Rights law (in several recent cases the European Court of Human Rights has not been swayed by arguments that those on the public service have had to bear the brunt of economic reform);
• and discrimination. (The key challenge here considered was whether these pension changes would be age discrimination: however, the law states that age discrimination can be justified as a proportionate means to a legitimate end, and it is likely to be considered as such in this instance).

At this time, we will therefore not be challenging the introduction of the Police Pension Scheme 2015. However, we will continue to monitor how the scheme operates in practice and we maintain an open mind should circumstances change that give rise to a potential successful legal challenge.

Andy Fittes
General Secretary
Police Federation of England and Wales

Transfer-in deadline extended to Friday 10/4/14

Email from HR yesterday (7 April)

The below email was sent out yesterday by HR to give urgent information to officers who wish to transfer-in pension entitlements from previous employments. This has caused some confusion and some believe that they must contact Capita in order to remain in the police pension scheme - this is not the case. All officers will remain in the police pension scheme by default and do not have to inform Capita that they wish to do so.

However.....you must inform Capita if you wish to transfer-in pension entitlements from a previous employment and they've extended the deadline to this Friday (10 April) so if you do need to transfer-in, DON'T DELAY!

URGENT INFORMATION - NEW POLICE PENSION SCHEME 2015

All Police Officers should have now received information in relation to the changes to the Police Pension Scheme 2015 and whether they have full or tapered protection. Unfortunately, the HR Helpdesk is only able to confirm the information that Capita have provided to us and cannot answer any queries in relation to your specific pension queries which must be directed to Capita on 0845 0702 702.

Due to the delays in providing the information in relation to the New Police Pension Scheme, 2015 some officers who have a pension that they wished to transfer over to the current scheme were unable to notify Capita by the deadline of the 31st March, 2015. However, Capita have informed us that they will accept that the transfer process has begun for members who wish to transfer provided that they received notification by 5pm on Friday 10th April, 2015. This is the final deadline with no exception.

Notification can be made either by e:mail or completing the attached Letter of Authority form and e-mailing it or scanning it direct to swalespolice.pensions@capita.co.uk. Click here to download the letter of authority form

There may be a number of officers on annual leave due to the Easter holidays so could we ask that you bring this e:mail to their attention.

Transferred in Service and Transitional Arrangements

If you're not sure if you've transferred your old pension in, please contact Capita asap:

Update from the General Secretary.

After raising our concern, we have received some positive news from the Home Office today, that affects members who have accrued pension rights relating to other employments before joining the police.

If you are a member who has worked outside the police, then you may be able to transfer in those pension rights to your existing police pension scheme (PPS or NPPS). This may enable you to get transitional protection if you were not entitled to it before, or to get an improved level of transitional protection. This will benefit you financially.

Read more here.....

Pertinent Additional Documents

Were you mis-sold your police pension?

The Home Office have placed a pension calculator on their web site which you can view here

You can view the PFEW FAQ on long-term pension reform here

You can view an updated FAQ from the PFEW as posted in 2013 here

You can view the letter written by Ian Rennie, PFEW General Secretary, regarding the long term reforms of police pensions by clicking here

You can view a letter sent from Theresa May to the PNB Chair regarding her decisions by clicking here

They have also created an example sheet of how this may affect you which you can view here

And you can view a HO FAQ on the new scheme here

This is the latest FAQ on the new scheme here

You can view the Reform Design Framework by clicking here which gives more information particularly on the tapering effect

You can view the response of Ian Rennie, PFEW General secretary to this announcement further down this page or by clicking here

E.R Tuesday 4th September 2012

HOME OFFICE  

Police Pension Scheme  

The Secretary of State for the Home Department (Theresa May): On 27 March 2012, I issued a written statement to the House concerning remuneration and conditions of service in the police. Within that statement I explained that I would put forward a proposal on long-term reform of police pensions to the Police Negotiating Board, which I did on the same day. In common with changes which have been developed across public service pension schemes, my proposal reflected the principles for reform established last year by the report of the Independent Public Service Pensions Commission, led by Lord Hutton.

My officials have been engaged in detailed and constructive discussions with representatives of the Police Negotiating Board since 27 March, and I have received a number of written representations from the organisations represented. Having considered the outcome of those discussions, and the representations made during this period of consultation, I am announcing today my decision for the Reform Design Framework for police pensions. This framework sets out the Government’s final position on the main elements of police pension reform and will form the basis for discussions on points of further detail in moving to implement these changes.

The main parameters of the new scheme design are set out below:

a. a pension scheme design based on career average revalued earnings;

b. a provisional accrual rate of 1/55.3 of pensionable earnings each year, subject to agreement on the outstanding issues;

c. there will be no cap on how much pension can be accrued;

d. a revaluation rate of active members’ benefits in line with the Consumer Prices Index (CPI) + 1.25%;

e. pensions in payment and deferred benefits to increase in line with CPI;

f. average member contributions of 13.7% from April 2015. As announced by the Chief Secretary to the Treasury on 20 December 2011, the Government will review the impact of the 2012-13 contribution changes, including the effect of membership opt-outs, before taking final decisions on how future increases will be delivered in 2013-14 and 2014-15, and in the new scheme. Interested parties will have a full opportunity to provide evidence and their views to the Government as part of the review;

g. flexible retirement from the scheme’s minimum pension age of 55, built around the scheme’s Normal Pension Age of 60 – for all active members aged 55 or more at retirement, 2015 scheme benefits taken before Normal Pension Age will be actuarially reduced with reference to the 2015 scheme’s Normal Pension Age, rather than the deferred pension age (ie state pension age). Those members’ benefits will continue to be paid after age 60 at that actuarially reduced level;

All other members will have their 2015 scheme benefits actuarially reduced on a cost neutral basis from the scheme’s deferred pension age;

h. the Normal Pension Age of 60 will be subject to regular review, which will also consider the linked early retirement facility described at (g). These reviews will consider the increasing State Pension Age and any changes to it, alongside evidence from interested parties, including staff associations and employers. It will consider if the Normal Pension Age of 60 remains relevant, taking account of the economical, efficient and effective management of the police service, the changing profile of the workforce and the occupational demands of, and fitness standards for, police officer roles;

i. this regular review will be informed by scheme data and experience;

j. late retirement factors for members retiring from active service to be actuarially neutral from Normal Pension Age;

k. a deferred pension age equal to the individual’s State Pension Age;

l. optional lump sum by commutation at a rate of £12 for every £1 per annum of pension foregone in accordance with HMRC limits and regulations;

m. abatement in existing schemes to continue;

n. ill-health retirement benefits to be based on the arrangements in the 2006 scheme;

o. all other ancillary benefits to be based on those contained in the 2006 scheme;

p. members rejoining after a period of deferment of less than 5 years can link new service with previous service, as if they had always been an active member;

q. members transferring between public service schemes would be treated as having continuous active service;

r. an employer contribution cap and floor, as described in the Reform Design Framework.


Transitional and protection arrangements


There will be full statutory protection for accrued rights for all members as follows:

a. all benefits accrued under final salary arrangements will be linked to the member’s final salary, in accordance with the rules of the member’s current schemes, when they leave the reformed scheme;

b. full recognition of a member’s expectation to double accrual for service accrued under the Police Pension Scheme 1987 (‘the 1987 scheme’), so that a member’s full continuous pensionable service upon retirement will be used to calculate an averaged accrual rate to be applied to service accrued under the 1987 scheme;

c. members of the 1987 scheme to be able to access their 1987 scheme benefits when they retire at that scheme’s ordinary pension age (i.e. from 30 years’ pensionable service; age 50 with 25 or more years’ pensionable service; or the member’s voluntary retirement age), subject to abatement rules for that scheme. Pensionable service for the purpose of calculating the ordinary pension age will include any continuous pensionable service accrued under both the 1987 scheme and the 2015 scheme;  

d. members of the Police Pension Scheme 2006 (‘the 2006 scheme’) to be able to access their benefits under that scheme when they retire at that scheme’s normal pension age (i.e. age 55);

e. members will continue to have access to an actuarially assessed commutation factor for benefits accrued under the 1987 scheme.

There will be statutory transitional protection for certain categories of members, as follows:

a. all active 2006 scheme members who, as of 1 April 2012, have 10 years or less to their current Normal Pension Age (i.e. age 55) will see no change in when they can retire, nor any decrease in the amount of pension they receive at their current Normal Pension Age. This protection will be achieved by the member remaining in their current scheme until they retire;

b. all active 1987 scheme members who, as of 1 April 2012, have 10 years or less to age 55 or have 10 years or less to age 48 and are 10 years or less from a maximum unreduced pension, will see no change in when they can retire, nor any decrease in the amount of pension they receive at their current Normal Pension Age. This protection will be achieved by those members remaining in their current scheme until they retire;

c. there will be a further period of tapered protection for up to 4 years for scheme members. Members who are within 4 years of qualifying for transitional protection, as of 1 April 2012, will have limited protection so that on average for every month closer to qualifying for transitional protection they gain about 53 days of protection. The period of protected service for any member under these tapering arrangements will have finished by 31 March 2022. At the end of the protected period, they will be transferred into the new pension scheme arrangements. Further details on how the tapered protection will apply are set out in the Reform Design Framework.


Areas for further detailed discussion


As set out in the Reform Design Framework, there will be further discussion on specific areas of detail, responding in part to issues raised during consultation with the Police Negotiating Board. In particular there will be further consideration of equalities issues that have been identified, or any which may be identified during further discussion, as well as arrangements to ensure compatibility between the new scheme design and recognised existing or future schemes for police officers exiting the service before Normal Pension Age.

I believe this represents a fair outcome, reflecting the range of issues raised during consultation on my original proposal. This will continue to offer valuable pension arrangements for police officers which will be affordable and sustainable in the future.

The Government Actuary’s Department has confirmed that this design does not exceed the cost ceiling set by the Government in my proposal of 27 March. Copies of the Reform Design Framework and the Government Actuary’s Department verification report have been placed in the Library of both Houses.

This is Ian Rennnie's response to this announcement:

Police pensions: more information

04 September 2012


THE NEW POLICE PENSION SCHEME FROM 2015

SUMMARY


The Government is reforming pensions across the public service. While the Staff Side of the Police Negotiating Board (of which PFEW is a constituent part) made the strongest possible representations in relation to all aspects of the proposals for police pension reform during the consultation process, there was no realistic prospect of that reform, including the introduction of a career average scheme, not applying to police pensions.


The choice for Staff Side was therefore to allow the Home Secretary to impose her preferred scheme, as per her letter to the PNB of 27 March (see link below), or to negotiate in an attempt to secure as many improvements as possible.
http://www.polfed.org/Letter_HS_to_John_Randall_Pensions_270312.pdf


The key priorities identified by Staff Side were:


• to avoid the position (included in the Home Secretary’s preferred scheme) where any member who did not serve until 60 would not receive his or her career average pension until State Pension Age (which it is currently intended will increase to 67 and subsequently to 68);

• to reduce member contributions from the proposed average rate of 13.7%; and

• to achieve the best possible transitional arrangements outside the cost of the new scheme.

Unfortunately we were unable to obtain any movement from the Government on the contribution rate. However, by engaging in the consultation process and accepting the proposed changes we have been able to secure the following:

• any member who serves until at least 55 will be able from that point:
o to retire and take that pension immediately, actuarially reduced from 60 (rather than from State Pension Age).

• improved transitional arrangements, outside the cost of the new scheme, in particular:
o an extension of full protection to members of the 1987 Police Pension Scheme and aged 38 or over and 10 years or less away from being able to retire with a maximum 30 year pension; and
o an extension of the tapering protection to those within four years of full protection.
 
If we had not engaged in the consultation process, then under the Home Secretary’s preferred scheme, any member who left service before 60 would have had to wait until State Pension Age before accessing his or her career average pension (or to have an actuarial reduction calculated from State Pension Age). In addition, fewer officers would have been afforded protection by the transitional arrangements.

 

We will continue to engage with the Home Office to attempt to secure the best possible arrangements for our members.

 

Ian Rennie
General Secretary