LGPS Scheme Developments

Pension credits payable from age 60

This amendment extends the rights of individuals who have been awarded a share of retirement benefit following their divorce from a member of the LGPS.

Previously, pension credits could only be paid to members at their 65th birthday (unless they were suffering from serious ill-health). They are now allowed to take them from age 60 with full actuarial reductions, i.e. a male member taking them at 60 would receive a 24% reduction to his pension and a 12% reduction to any lump sum payable.

Pension credit members are not allowed to commute pension in order to increase their lump sum but may compound trivial pensions.

This regulation has been backdated to 6th April 2009, meaning that pension credit members who reached 60 prior to, or since that date may elect to have their pension put into payment from their 60th birthday, or from 6th April 2009, whichever is the earliest. If this applies to you please contact the pensions section.

Early payment of 3rd Tier Ill Health

A member who has had Tier 3 ill health retirement benefits, which have been suspended on review or after 3 years, is entitled to their retirement pension at age 65. Such members can now access their deferred benefits from age 60 or from age 55 with employer permission. An actuarial reduction will be applied to the benefits in accordance with Government Actuary guidance.

This ensures that members with suspended ill-health benefits are afforded the same capacity for release of those benefits before age 65 as normal deferred members of the Scheme.

This provision is effective from 1st October 2008 which was the end of a period of transitional protection, and provides continuity of rights to members who have left in receipt of the third tier of ill-health benefits from that date.